What Type of Entity Should Your Startup Be?
In counseling entrepreneurs, one of the first questions that arises is about choice of entity type – in other words, should the entrepreneur’s business be contained in a C corp, S corp, LLC, limited partnership or general partnership, or be structured in some other way? While there are obviously a number of factors that must be considered when answering this question, my answer is – with few exceptions – that an LLC is the best form. This is not yet the universal view, and some excellent attorneys have a different predisposition. So, I’ll lay out my basic reasons here, and I’ll be curious for comments – especially from people with a different viewpoint.
To keep it simple, my reason is that an LLC provides the benefit of limited liability for the owners, pass-through tax treatment (that is, no double tax), and ultimate flexibility in structuring the equity ownership and management rights of owners. No other entity form has this combination of features. Read more
10 Legal Lessons from our ‘Unimaginable Journey’
In Aviad Meitar’s book, An Unimaginable Journey: How Pepsi Beat the Odds in Romania, he recounts his incredible experience in launching, building and selling the Pepsi business in Romania. His focus is on the business lessons and personal highs and lows (mostly highs) of that experience. Although he is also a lawyer (non-practicing), the book does not delve into the legal lessons of our journey.
As the General Counsel of Pepsi Romania from 1991-2006, here are the top 10 legal lessons that I learned, which I regularly have the chance to apply in current representations. Many of these lessons can be gleaned from the stories presented in Aviad’s book. Read more
Dorsey Announces Establishment of Educational Publishing, Technology and Services Industry Group
I’ve been working on this for a year and am excited about my firm’s commitment to this innovative, rapidly growing and essential industry. We have 35 attorneys who have joined the group so far. Please contact me if you’d like to learn more about our ability to add value to your educational publishing, technology or services business.
A copy of the firm’s press release is reprinted below. You can also find it here: http://www.dorsey.com/educ_pub_industry_group_pr/
Jeff Read more
Favorite Quoted Quotes from ‘An Unimaginable Journey’
My friend, business partner and client, Aviad Meitar, just published a very interesting book about our experience in building the exclusive Pepsi-Cola bottler in the country of Romania. We made the first trip to Romania together in January 1991, just 13 months after the revolution that overthrew Ceausescu. Since that incredible first encounter, Aviad always said one day he would write a book about it. Now the book, An Unimaginable Journey: How Pepsi Beat the Odds in Romania, is out, published by Amazon’s subsidiary, BookSurge.
Here’s the independent review from ForeWord Clarion Reviews:
“The journey described by Aviad Meitar is nothing if not intriguing. This well-written and concise eyewitness account of building an American brand in an Eastern European country offers rare insight into how a business can succeed even in the face of the most daunting challenges.”
At the beginning of each chapter, Aviad presents a voyage-themed quote that relates to the story in that chapter. Most of these quotes were new to me, and many seemed both insightful and of general applicability to emerging companies and entrepreneurs. In this first post about this book, I present my favorite quoted quotes: Read more
Know the No’s
‘No’ is a powerful word in business negotiations. If used wisely, it can help you (or the other party) achieve the target objectives. If misused or misinterpreted, it can crater (or at least hamper) a deal for the wrong reasons. ‘No’ is such a problem in business negotiations that the seminal book on the topic is called Getting to Yes.
One of the most effective ways to use the word is what I call “early and often”. If there is a critical issue of fundamental importance, it is generally best to put that on the table right up front, so there is no misunderstanding later on. Think of “no personal guarantees”. If you don’t make that ‘no’ an unequivocal condition of the deal at the beginning, two things may happen: first, you will probably face even more friction in the deal when the issue arises later; and second, you will probably need to trade something extra of value in order to prevail on the issue. In this instance, there is no word better than ‘no’. Read more
