Many Americans turn to franchising as the key to making their dreams of small business ownership come true. Yet every day, more and more of these aspiring entrepreneurs are discovering that their greatest challenge is not choosing the right concept, but rather gaining access to inexpensive capital needed to complete their purchase. To meet this challenge, a growing number of people are getting into the franchise business by investing in their own franchise—many of them using investment capital they didn’t know they had. Through a vehicle commonly known as Rollover as Business Start-ups (ROBS), entrepreneurs can use their IRA or 401(k) funds to invest in a franchise without taking a taxable distribution or getting a loan.
There are several legal pitfalls that business owners can fall victim to that can make the difference between a successful business and one that fails. However, with a little foresight and planning you can protect your business and limit your liability.
Money's too tight to mention. Or maybe you need money for nothing, because your product or service is still only available on the back of a coaster from the local bar. Fact is, if your business needs to get some extra money, there's a limited number of ways to do that -- here are ten of them.
Most companies in America are the equivalent of garage businesses with no corporate structure. That works fine for most people ... until you need to hire someone, take out a business loan or you get sued. Business incorporation provides you legitimacy, and some legal protection. Sure, there are legal forms and paperwork to complete, and you will need to ensure compliance with a formal set of rules (most of which you're already following,) but the benefits will easily outweigh the nominal cost of incorporation.
Company.com "Made for Business" video.
We talk a lot about using LLCs these days, so much so that people ask us, “Why use a Corporation at all, if LLCs can do it all and more?” Is there a place for Corporations still? I think the answer is definitely “yes.” I can think of several occasions where I will reach for Corporation Articles, instead of LLC formation documents.