{"id":5124,"date":"2018-10-09T08:29:44","date_gmt":"2018-10-09T08:29:44","guid":{"rendered":"https:\/\/www.kdanmobile.com\/blog\/?p=5124"},"modified":"2023-08-24T03:37:16","modified_gmt":"2023-08-24T03:37:16","slug":"how-effective-document-management-can-save-your-startup-loads-of-trouble-down-the-road","status":"publish","type":"post","link":"https:\/\/www.kdan.com\/blog\/how-effective-document-management-can-save-your-startup-loads-of-trouble-down-the-road","title":{"rendered":"How Effective Document Management Can Save Your Startup Loads Of Trouble Down The Road"},"content":{"rendered":"\n

Everyone has seen the next \u201ccool idea\u201d somewhere: in commercials; in stores; or while watching Shark Tank<\/em>. These ideas will inspire you to come up with ideas for products, services, or entire businesses. What happens when you decide to pursue these dreams? Aspiring entrepreneurs and early-stage startups<\/a> need to be aware of certain types of documents and filing practices that can protect them down the road.<\/p>\n\n\n\n\n\n\n\n

Getting Started<\/h2>\n\n\n\n

Once your initial planning and market research is complete, you\u2019ll want to officially form your company. To do so, you\u2019ll file some type of document, establishing your company as its own entity. Two of the most common types of documents are corporate charters (for corporations) or articles of organization (for limited liability companies).<\/p>\n\n\n\n

You may also receive other forms from your government at this time. For example, in the U.S., you\u2019ll be assigned an EIN (employer identification number). Documents like these and your formation paperwork are important when setting up a bank account<\/a> for your company or applying for a business loan, so you\u2019ll want to make sure they are well-documented and stored in a secure digital location<\/a>.<\/p>\n\n\n

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Working with Outsiders<\/h2>\n\n\n\n

You\u2019ll also want to keep track of contracts you set up with co-workers, interns, or sub-contractors you work with. During the early stages of your company\u2019s development, it\u2019s tempting–and sometimes financially necessary–to offer equity in exchange for work. Although equity-for-work agreements may be required to get your company out of the gate, one of the biggest mistakes a company can make is not keeping diligent track of contracts, receipts, and descriptions of the work that will be completed. Even if equity isn\u2019t promised, there are instances of sub-contractors coming back and claiming that the work they completed exceeded the payment they received, entitling them to equity in your company. The same type of situation may occur with interns or other people involved with the business early on–just look at Facebook\u2019s history<\/a>.<\/p>\n\n\n\n

One of the biggest favors you can do for your future self is manage your contracts and other important documents<\/span><\/a> so you can reference them should some type of equity dispute come up. Some start-ups would rather look for opportunities employing a registered agent<\/a> to handle their documentation, and the other would turn to automatic solutions, like the contract management software<\/span><\/a>.<\/p>\n\n\n\n

Finally, non-disclosure agreements, or NDAs, are very common practices for any company that is developing intellectual property (IP). NDAs can be simple (templates are available online) but set up an agreement between you and whoever you are working with to keep the ideas discussed among parties a secret. It\u2019s a best practice to have anyone you meet to discuss your business idea with you or who does any work for you to sign an NDA.<\/p>\n\n\n\n

You\u2019ll also want to file these away in case of any future legal disputes. It\u2019s a good idea to set up some type of dated document or file for each meeting you have that includes a signed NDA, a record of whatever you discussed, and any materials that may have been involved in the meeting. You can save these as separate documents in a folder, or organize them into a single PDF<\/a> and store them in a \u201cMeetings\u201d file.<\/p>\n\n\n

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Protecting Your Intellectual Property<\/h2>\n\n\n\n

If your idea is innovative enough, everyone will want a piece of your success. Oftentimes, that means trying to replicate some aspect–if not the entire premise–of your product, service, or business. There are several ways to arm yourself against would-be competitors and maintain a competitive advantage.<\/p>\n\n\n\n

Leaving a Paper Trail<\/h3>\n\n\n\n

Write everything down, date it, and keep an electronic copy of it. There\u2019s nothing fancy about this step but being able to go back and produce a well-documented progression of your company\u2019s development can help protect you against a number of unforeseen IP-related disputes. When we say document everything, we mean everything<\/em>. Brainstorming documents, to-do lists, ideas for products drawn on napkins–anything that shows how your company\u2019s ideas came to be. This may be crucial if you have to prove that your ideas are in fact, your ideas. We recommend designating a file for any type of product-development-related documents\/drawings\/whatever.<\/p>\n\n\n\n

Setting up Legal Protection<\/h3>\n\n\n\n

Depending on the nature of your company, there are different legal routes to protect your intellectual property. Three of the most common are patents, copyrights, and trade secrets.<\/p>\n\n\n\n