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Mistakes that Colorado startups should avoid

Research indicates that 75 percent of startup businesses that have been funded by venture capitalists will fail, and a similar amount of small businesses will last no more than 10 years. Not being able to attract and keep enough customers to make a profit is a major factor in the majority of business failures. In fact, there are several customer-related mistakes owners make that contribute to the end of their businesses.

No matter how innovative a product may be, if it does not directly address the needs and wants of the desired customer, it will not be enough to keep the business afloat. In order to have the right product-market fit, it may be necessary to create a minimum viable product that is presented to a target audience who will be able to provide valuable customer feedback. The feedback should serve as a basis for modifications made to the product to make it market-ready.

How to know if an idea is worth pursuing

A successful company in Colorado is one that can meet the needs of its target market. If it cannot do so, even a company that has had success in the past may not make it. However, there are ways in which a startup can validate its idea without necessarily spending a lot of time or money. For instance, it may be a good idea to start a conversation with potential customers.

This is something that even large brands will do to make sure that they are creating goods or services that their customers want or need. Focus groups can be an effective and affordable way to get such information. They can be an informal way to get whatever data the business needs to validate its idea. Once a company understands what the market wants, it is important to determine how large that market is.

How startups can mount influencer marketing campaigns

Colorado entrepreneurs might benefit by using influencer marketing in order to grow their businesses. While this type of marketing strategy was traditionally only available to large corporations with sizable amounts of capital and large human resources, the advance of the internet has made influencer marketing more readily available to small startups as well.

Small businesses and startups typically do not have the massive capital reserves and thousands of employees that large corporations do, leaving them unable to mount massive influencer marketing campaigns. While large companies may use celebrities to sell their products and services, small companies normally cannot afford to pay the large amounts that they command.

Stakeholders hope to reform patent law for biotechnology

Life scientists and companies in Colorado planning to protect their rights to biotechnology have hit legal hurdles in recent years. A 2012 decision from the Supreme Court of the United States narrowed the ability to award patents for biotechnology, and courts have been striking down existing patents that intellectual property owners had once thought secure. Concerned parties, such as the American Intellectual Property Law Association, the American Bar Association's Section of Intellectual Property Law and the Intellectual Property Owners Association have proposed revising a portion of U.S. patent law to spell out specific guidelines for determining which biotechnology deserves patent protection.

The Supreme Court established that abstract ideas, natural phenomena and laws of nature did not represent patentable concepts unless people had developed novel or useful applications for them. The 2012 decision created a two-part test for judging whether something qualified as patentable. Since then, federal courts have applied the test in very broad terms. The result has been the elimination of many patents, especially diagnostic biotechnology like a prenatal genetic test.

Trends in venture capital

Venture capital is a prime, competitive source of financing for new businesses. Investors in Colorado as well as entrepreneurs who are seeking financing for their startups should be aware of the trends that are shaping the venture capital industry.

One trend to note is that there are venture capital firms that are pushing against the sexism and lack of diversity that is rampant in the tech industry. These companies are making purposeful strides to make sure their investment choices are more inclusive. For example, there is one firm that is focusing on investing in startups created by non-white entrepreneurs. Others are committed to backing startups led by women or immigrants.

High tax rates may be problematic for business

A study by EY found that high corporate tax rates may slow the rate of mergers and acquisitions in the United States. This may make it harder for business owners in Colorado to exit their companies or grow them over time. The study also found that taxation of international business income may give foreign companies an advantage when it comes to bidding for companies around the world.

It may also give foreign companies an advantage when it comes to bidding for American companies as well. Between 2014 and 2016, American companies were buyers in 16 percent of merger deals. However, they were acquired in 31 percent of merger deals. From 2004 to 2016, the U.S. lost $510 billion in global mergers and acquisitions, expressed as a net deficit. However, it is believed that a 25 percent corporate tax rate would have resulted in a net gain of $660 billion in assets.

How to protect your intellectual property

Intellectual property is any type of work or invention that is the result of creativity. In the state of Colorado, inventors, authors, musicians, and artists need to protect their intellectual property to prevent others from using or financially benefiting from their creations without their permission. There are three types of IP protection: trademark, patent, and copyright. The following example shows how these different kinds of IP protections can apply in the development of a health app.

A trademark can protect any words, symbols, phrases, and sounds that identify a particular product. The developer of a health app needs to create a name, logo, and tagline, which will distinguish it from other similar apps. Trademark registration protects the app's name and reduces trademark disputes.

How AR and VR can help a company

Colorado business owners have likely heard of augmented reality and virtual reality. The Pokemon Go game that was all the rage in 2016 is an example of augmented reality, but there are far more sophisticated applications that may benefit a corporate entity. Virtual reality has also been implemented to create more realistic environments for computer games. Like AR, there are other applications for VR beyond how it is used today.

A company may be able to make use of AR and VR because it allows them to actively engage with customers. Using touch, sound or smell may heighten the customer experience and make it easier for companies to build relationships with them. The use of these technologies may make it possible to share information about a company's goods and services in a manner superior to what has been available in the past.

Mistakes small business owners make late in their careers

It is natural for Colorado residents to attempt to maximize returns during strong markets and protect against losses in weak markets. However, many small business owners don't take this approach when it comes to their companies. While they may work hard to grow their companies, they might not seek help and guidance to maximizing values.

Small companies tend to be dependent on the skills of the owner to run properly. They may also lack a diverse client base, which could make it harder to sell the company. Overall, as many as 80 percent of companies that are put on the market won't sell. Those who are familiar with mergers and acquisitions say that owners tend to overestimate the value of their companies, which can be a stumbling block to making a sale.

Planning is key to entrepreneurial success

Analysis and preparation are key points of focus for any successful Colorado entrepreneur or business owner. Planning, in all its forms, is vital for business owners, and yet many turn their eyes and efforts toward the next challenge without proper examination. It does little good to jump in with both feet if the jumper doesn't know where to land.

In a business environment, planning means acknowledging measurable factors to the extent that they're available. Delving into a detailed analysis of threats and potential pitfalls, crunching numbers and examining likely benefits increase the likelihood of success for new and established endeavors alike. Business owners who fail to take the planning steps seriously are setting themselves up for underperformance or failure.