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Denver Business and Commercial Law Blog

How business owners can plan for startup life

When entrepreneurs in Colorado consider the profit-making potential of their great ideas, they may be eager to leave their traditional job and start their own business instead. Many people want to find success for themselves, and the appeal of the startup life can be substantial. However, it is important to evaluate the situation and prepare in order to start off on the right foot.

One of the most important steps is to research the plan for the business in advance. Business owners may want to throw all of their energy into their concept in order to help it succeed. However, by working to research the decision in advance, people can be much better prepared for the transition. In particular, moving the business toward profitability before leaving a job can be a good step to ensure that an entrepreneur will have the financial support necessary to push the business to the next level. Building up a strong savings cushion can also be an important step toward greater entrepreneurial success.

Questions to ask before accepting venture capital

When an investor offers a business in Colorado venture capital, the owners need to think carefully about the advantages and disadvantages of making a deal before proceeding. According to one industry expert, about 40 to 50% of venture capital investments don't succeed, and a vast majority of profit only comes from 10 to 20% of investments that pay back big returns. For the business thinking about accepting this type of capital, carefully considering the chance that things might fail is important.

Typically, a venture capitalist will ask themselves a few questions when deciding whether to invest in a company. They will evaluate whether a business is large enough to be sustainable over time. They will consider whether the people operating the company are capable of substantial growth. Finally, they will take a close look at the founder and figure out if they have that special quality required to succeed in a competitive market.

Transgender discrimination can appear in the hiring process

It’s no secret that a lot of transgender workers face mistreatment at work. The National Transgender Discrimination Survey states that 26 percent of trans workers lose their jobs from bias and 50 percent of them are harassed on the job. Despite increased awareness on the issue, it doesn’t appear to be slowing down anytime soon.

However, it’s worth noting that those statistics come from trans workers that had jobs. Some end up facing discrimination before they even get one during their job interviews. A recent story involving a successful sex discrimination lawsuit helps demonstrate when you might expect to see this behavior during your interviews or hiring.

Online real estate rivals involved in lawsuit

Zillow, a Seattle-based real estate company with listings in Colorado and throughout the country, filed two lawsuits against its rival Compass on April 19. The suits allege that Compass violated the intellectual property of Zillow in addition to poaching employees who violated their non-compete agreements. The lawsuits were filed in both state and federal court, and ex-employees named were accused of stealing things like customer lists, sales data, and highly technical information.

According to the federal lawsuit, Compass deliberately targeted Zillow personnel and information by opening offices in the Seattle area in 2018. Several other companies have also filed suits against Compass, alleging that the company engaged in similar predatory practices. In a statement to the press, Zillow said that it supports healthy competition in the industry but has the responsibility to defend its intellectual property when needed.

Patent trolls pose a problem for companies

When a person in Colorado creates a new product or improves upon an existing one, he or she may be given a patent. The purpose of the patent is to provide the creator the exclusive right to sell or license the product for a certain period of time. While patents are supposed to reward innovation, some have chosen to acquire patents for the sole reason of engaging in infringement litigation.

Individuals and companies that buy or otherwise acquire patents for this purpose are referred to as patent trolls. In some cases, the patents that they have in their possession don't protect a truly novel idea or product. In one case, a jury awarded a company called HouseCanary roughly $750 million in a patent infringement case. The company claimed that a business called Amrock used its intellectual property to create a real estate valuation product.

Clearbanc expands financing options for e-commerce startups

Many entrepreneurs in Colorado pursue business ideas related to e-commerce. A new company called Clearbanc has developed a financing model specifically for e-commerce startups that differs from venture capital. The company provides money to qualifying applicants to support online marketing efforts that drive sales. Instead of requiring an equity stake in a developing company, Clearbanc collects fees starting at 5 percent of top-line monthly revenues until the lender recovers the cash advance.

In addition to the 5 percent fee, Clearbanc could add more fees between 6 percent and 12.5 percent based on how an e-commerce startup spends the money. Advertising purchased from Google, Facebook, Twitter, Amazon or Pinterest with the cash advance would require a 6 percent fee. Money spent on other things related to marketing, like new computers, could incur a 12.5 percent fee.

Photographer loses copyright case involving corporate logo

Those who follow copyright law in Colorado may be interested in a court case of interest involving a famous photograph and an iconic product logo that just ended. After the Supreme Court refused to hear the appeal, the Ninth Circuit Court of Appeal's opinion stood.

The photograph in question was taken for a major periodical in the 1980s. The photograph is of famous basketball player Michael Jordan in a mid-air jump. His legs are spread wide, one hand is held high in the air and the other one is holding a ball in his outstretched hand. The photo is intended to show him preparing to dunk the ball.

Tech company accused of withholding age discrimination evidence

If an older worker has their job terminated, the Older Workers Benefit Protection Act (OWBPA) requires employers to inform the worker if this is part of a staff reduction program and who is specifically being affected by it. If there is evidence suggesting that this is primarily targeting older workers, then the worker could avoid signing something that ends their jobs and leaves them with less than they deserve.

Many employers continue to disobey the regulations the OWPBA established decades ago. One potential example that you can see in national news lately comes from the one of the most dominant technology companies in the nation, IBM. The technology consulting firm has come under fire after recent reports indicate they’ve laid off thousands of older workers in the last few years, leading to several former employees filing a lawsuit after finding out.

Helping family businesses achieve success

Even in an era of venture capital and publicly traded corporations, family businesses continue to be a mainstay in Colorado. This is especially true among smaller, local businesses, but it can extend even to large privately held corporations. In many cases, multiple members of a family are involved in supporting business growth and development over the years. In addition, family members may be trained and develop into roles in the company, and the business often passes from generation to generation. A successful family business can lift up the whole family, providing education funds and other key resources.

The majority of family businesses do not continue into a third generation; however, businesses that live on for two generations often remain successful. Those that do survive can become strong and powerful; nearly one-third of the S&P 500 companies are family businesses. In France and Germany, 40 percent of the 250 largest firms are family concerns. These large, prominent family businesses often do well over time. When they do go public, their success rates often exceed that of other, non-family companies.

The importance of filing early with the US Copyright Office

Colorado residents interested in copyright law may like to learn more about how a recent US Supreme Court ruling impacts copyright registration. In March 2019, the United States Supreme Court ruled that copyright owners need to have their work registered with the United States Copyright Office before they are able to file litigation to enforce their rights. This decision by the United States Supreme Court gives added emphasis to the importance of early filing of copyright applications.

When it comes to copyrights, people usually think about it in connection to music, movies, art or photographs. However, copyright laws are designed to protect much more, including computer software, presentations and other forms of expression.

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