by Kathryn Hough
Now is the best time for entrepreneurs to sit down for a few hours and plan ahead for 2013. Earlier this week, we offered productivity tips to help entrepreneurs set themselves up for success in the 2013. Today, we bring you tips to help protect your startup in 2013, thanks to Polsinelli Shughart attorney Brian Salmo. Below, Salmo points out a few things that entrepreneurs should pay attention to when it comes to managing risk and protecting intellectual property.
Q: What can startups do to manage and reduce risk when hiring next year?
Brian Salmo: When creating compensation terms with employees and consultants, especially incentive and/or equity compensation, those terms need to be in writing. Of course I recommend having an attorney document these arrangements, but at a minimum, the parties should have an email or letter setting forth the deal terms. People think they understand each other during a conversation, but when a deal is put on paper, there are always revisions before everyone is truly on the same page. So in addition to having a written record of the arrangement, documenting terms is a good exercise for the parties to really strike a deal they both understand, which reduces the risk of future problems.
Determine if prospective employees and consultants are subject to any restrictions with any current or former employer or client, like a non-compete agreement, moonlighting policy, or invention rights agreement. If so, you should review the restriction to make your proposed role for the person does not conflict with it.
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About Brian Salmo
In his business law practice, Brian R. Salmo assists clients on a variety of issues, including entity formation, governance, debt and equity financing, and acquisitions and sales of businesses. Mr. Salmo works with clients of different sizes, from entrepreneurial start-ups to publicly traded companies, covering a broad range of industries, including information technology, banking, and health care.
Mr. Salmo is also an active member of the firm's multi-disciplinary emerging technology company practice which assists clients in a variety of technical fields including information technology, life sciences, and energy. In St. Louis, the group works closely with Arch Grants, Capital Innovators, Olin Cup, and other programs and events in support of the St. Louis regional effort to support and encourage the establishment, funding and development of companies in these fields.