You can screw up a startup in any number of ways, from hiring the wrong person to inking a bad partnership deal. Now, the folks over at Avvo — the Seattle online legal forum and lawyer directory — have compiled a helpful little infographic with some of the most common legal pitfalls that get startups in trouble.

Some of these are pretty well known. But it’s never a bad thing to have a few helpful reminders, is it?

They’ve also listed some of the most frequently-asked startup legal questions, so those are included below as well with links to the answers.


Meanwhile, here’s a look at some of the most-commonly asked startup questions on Avvo. Maybe the answers to these questions will help you avoid the troubles listed in the graphic above.

  1. Should I incorporate my tech startup in Delaware or California – what are the benefits?
  2. Does sweat equity have value in an S Corp? How does sweat equity compare to a cash investment in a startup?
  3. Is a verbal partnership agreement for a startup binding in California?
  4. We invested money in a startup biz and the relationship has now gone sour. What are our rights as financial investors?
  5. I did not file for section 83b election within 30 days of C Corp startup conversion. What are the options now?
  6. How do I fire the co-founder of my startup?
  7. Will an LLC save me money on federal taxes as a startup?
  8. My startup company is being accused of trademark infringement. What should we do?
  9. Partnership and shares in startup?
  10. What is the Business License/Incorporation requirement for startup?

Previously on GeekWire: A sign of a bubble? Startup-related legal questions surge in Silicon Valley, Seattle

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Comments

  • Jason Warren

    Uncollected sales tax is another common reason that startups get into legal trouble (with the states)

  • http://www.wac6.typepad.com William Carleton

    Not a bad list, but “ways” 7 & 10 don’t ring true. Maybe by “bylaws” they mean the charter (for Delaware corps) or articles (for Washington corps), in which case, yes, the right charter for the situation is essential. On item 10, comingling accounts will expose you personally, but startups typically set up a bank account quickly. “Undercapitalizing” or at any rate not over-capitalizing is almost the whole point.

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