When it comes to startup opportunity, technology is the sector that rules. And few regions of the country are as prominent as entrepreneurial hotspots as Silicon Valley. With all the major tech firms that call California home and the huge number of bright thinkers they employ, it's safe to say that there are more than a few nascent companies trying to get off the ground right now.
They may only involve one or two people and be housed in a garage, basement workshop or cluttered spare bedroom, but there is something that they all have in common. They are doing business. And whether they know it or not, they are probably entering into contracts on a daily basis. While all those contracts should be in writing, there's a good chance some are not.
Regardless of your situation, if you are starting a business, there are at least three agreements that you should have in writing. Here they are.
- Partnership Agreement: This is something that any two people going into a shared venture of any kind should have. Whether it's buying a sailboat, a vacation home or starting a new business, a partner agreement is useful. It spells out who does what, how decisions are made, distribution of revenue and what happens if ownership interests change for any reason.
- Confidentiality Agreement: Whether your working on the next killer app or the chip that will make it work on the next wearable device, you want to make sure you keep control of proprietary information and product development. If you've got an existing customer base that might be an asset you want to protect with such an agreement.
- Independent Contractor Agreement: You probably can't do all the work your business requires by yourself. If you turn to an outside source you need a document that clearly defines him or her as independent. That means the contractor pays his or her own taxes. It also means that you can't dictate when or where work gets done.
There are template contracts out there, but to be sure that your agreements will do what's best for your business, it's always best to consult with an experienced San Jose business law attorney.
Source: Small Business Trends, "3 Contract Agreements Every Small Business Should Have," Nellie Akalp, accessed Feb. 27, 2015