…Being screwed by my investor when I started a business last year:
- LLC vs. LLC: if going to court and the contract was signed between two LLC’s you must have a lawyer represent you.
- Loans: when applying for a business loan they look at how long you’ve lived at your current address/ previous residence. They also look at how long you’ve held you current/previous job. So hopping around from job to job or apartment to apartment looks unstable and most likely you’ll be denied.
- Logos: even if you created your logo from scratch, if you do not file for proof of use within a certain time frame it becomes public domain.
- Reviews: can be your best friend. When our investor tried to screw us over, we wanted our money back. He refused so I wrote reviews on Yelp about his company (with photos of the emails to boot), BBB (Better Business Bureau) and his facebook page. The only person who can remove those reviews are me. In the end he gave us back than more then half our money.
- Public relations: is a deadly weapon. I told our shady investor that if he didn’t give us back our money, I was going to start a Go Fund Me explaining what he’d done to us. Which would stain his image forever.
- Create an LLC or some kind of corporation: to separate your personal assets from your business ones. That way if someone sues you they cannot touch your personal assets. So transfer everything from domain names, to copyrights, company cars and trademarks to whatever corporation structure you’ve chosen.
- Parting ways: with the investor make sure you get explicit written proof that they are giving up whatever equity you gave them. If you don’t they can come back when your business makes money and take their share.
- Settlement: make sure in the settlement contract they are not allowed to work on any projects similar to yours for X amount of years, and do not divulge any aspect of your business to new clients.
- Court: make sure in your original contract you state the venue of your choice to be the state you’re in. Each state handles these matters differently, but you don’t want to acquire the traveling fees let them do that.
In the end it was failing that taught me so many things. This is why being setback can make you rich in knowledge.