Upload
anoki
View
198
Download
3
Tags:
Embed Size (px)
DESCRIPTION
Preparing a Proper Legal Foundation: A Start-Up Fable . Louis Bohan Tsatsral Dorjsuren Amarzaya Nasanjargal . Content . Introduction Questions 1 Question 2 Question 3 Question 4. Introduction. Sarah and Jack’s business: tentative name was iUser Accessories. - PowerPoint PPT Presentation
Citation preview
Preparing a Proper Legal Foundation: A Start-Up Fable
Louis Bohan
Tsatsral Dorjsuren
Amarzaya Nasanjargal
Content Introduction Questions 1 Question 2 Question 3 Question 4
Introduction Sarah and Jack’s business: tentative name was iUser
Accessories. Goal: Locate 10 kiosks in malls and other high-traffic areas
to sell accessories for Apple iPods and iPhones. AD: Series of short videos that helps users learn how to
make better use of their iPhones and iPods via their website. Target market: 15-35 years old Apple users.
Introduction They took 1st place in University-wide business plan
competition and their business plan won: $7,500 in cash and $7,500 in (in-kind) services for the
business. As part of their business plan they completed:
A product feasibility analysis for iUser Accessories Concept statement and distributed it to 16 people (professors,
electronic store owners, Apple brand users, and parents of young users) and got positive result.
Surveyed 410 people in their target market. Some target market people did not realize the number of iPhone
and iPod accessories till they filled the survey.
Introduction As business plan, their one-and three-year pro forma financial
statements demonstrates their business is viable. Start-Up Capital: $66,000 They planned to collect:
Each $30,000 from friends and family Each $3,000 by themselves Salary per year: $32,000 for both
They needed to meet attorney and do formal trademark search before they use name and begin advertising. They prepared a list of issues and their recommendations Emailed the list to attorney 1 week prior the meeting Finally, they had permission to start their business as legally.
Question 1 Complete Jack and Sarah’s list for them,
including the issues you think they will place on the list along with their recommendations. Which of the issue do you think will stimulate the most discussion with the attorney, and which issues do you think will stimulate the least? Forms of Business Ownership and general
legal issues:
Forms of Business Ownership and general legal issues: As Founders, controlling owners
Independent of investors As minority investors
Awarded dividend As employees
Eligible for benefits As independent contractor (Online business)
Research Video production Marketing eCommerce
Starting a Small Business Federal Tax Identification
An Employer Identification Number is free, applied for online, and required by most vendors before conducting business with a retailer.
Business License Register the retail business with the state; dependent
on different state laws. Resale Certificate
Allows a store to buy goods tax exempt from a manufacturer or distributor. Then the store collects the sales tax from the customer and pays it back to the state. Most vendors will request a copy of your resale certificate before doing business with your company.
Business Name Registration If different form founder’s name/s
Starting a Small Business; Other permits
Different based on place and industry: Alcohol & Tobacco Sales Alarm System Permit Building Construction Health Permit Signage Special Events Zoning
Most important for iUser Accessories Zoning at kiosk location Signage Construction
Trademark Issue: Apple iProductsiBeaconiBook, iBooksiCaliChatiDVDiFrame LogoiLifeiMac iMessage
iPodiPadiPad MiniiPad AiriPhoneiSightiTunesiWebiWorkiMovie
Question 2 Make a list of the things you think Jack and Sarah did right
in preparing for their meeting with the attorney?
Answer 2 They had a good preparation for their meeting with attorney:
Finding a good attorney; Prepare a clearly schedule; their business plan Planned carefully the time to discuss with attorney; Prepare clearly things they want to discuss; they planned to
meet at local bookstore in several evening, looking at books that deal with forms of business ownership and other legal issues.
Tried to understand the legal issues; making a concise list of issues discuss with attorney.
After the first meeting with the attorney, they: Keep the list of legal issues; Send it to attorney a week prior to the meeting;
Question 3 Comment on the product feasibility analysis
that Jack and Sarah completed. Do you think the way Jack and Sarah completed. Do you think the way Jack and Sarah approached this task was appropriate and sufficient?
Was Jack and Sarah’s Feasibility Analysis appropriate and sufficient?
YES! 410, adequate sample Survey tested for validity Confirmed existing void of
information about accessories
Pro Forma statements build confidence
Competitive Advantage: Kiosks offer user assistance,
and benefits from online remarketing, unlike competition
Online iUser site is marketed at Kiosks, driving traffic
NO! Survey did not assess:
Necessity of individual accessories
Existing competitors to iUser Accessories
20 of 26 accessories may be too specific or useless
Pro Forma statements were not based on existing competitive business models
“Cash flow positive” in 4 months sounds over-confident
Was Jack and Sarah’s Feasibility Analysis appropriate and sufficient?
Question 4 What advantages do Jack and Sarah have starting iUser
Accessories together, rather than one of them starting it as a sole entrepreneur?
What challenges do you think Jack and Sarah will have keeping their partnership together?
Answer 4Advantages(2/1)
Jack and Sarah completed one and three year pro forma financial statements, which demonstrate the potential viability of their business.
They have commitments of funding from friends and family. They are fortunate in that they are able to each contribute
$3,000 to the business personally and were able to gain commitments of $30,000 each from their respective groups of friends and family
Answer 4Advantages(2/2)
They had emailed the attorney their list of issues along with their recommendations.
The attorney greeted them with a firm handshake and opened a file labeled “iUser Accessories, Jack Peterson and Sarah Jones”.
On an attorney’s file, made it seem like their company was already real.
Answer 4Challenges
Disagreements can occur, Because decision making among the partners is shared.
The liquidity of each partner’s investment is low. The business lies on the skills and abilities of a fixed number
of partners. Liability on the part of each partner is unlimited.