Entrepreneurs and Artists

This is a post that I will be augmenting over time.  I hope to post questions and concepts to help get the entrepreneur and artist thinking about themselves, as a business.  I will also be adding links to online sites that offer valuable information and materials.  I post this now simply to introduce the concept that entrepreneurs and artists, particularly those first starting out and getting their passion and work organized for business, need legal guidance.  Legal assistance isn’t cheap.  Heck, law school and thirty years of practice neither came easy, nor cheap.  However, there are some rudimentary questions and steps aspiring businesses can take early on. And, if you’re already blowing and going, maybe stop and take some time to think the business through.  Oh, and if you haven’t already, write a business plan.

This post is about basics.  The fundamentals.  It is to get not just you thinking, but also myself.  It’s an outline of ideas and will be augmented and modified as time goes by.

  1.  Most folks know that a decision has to be made on the business organization form.  Will you operate as a sole proprietor?  Or form a limited liability company?  Or perhaps a Sub-S or C corporation?
  2. Name.  What is the name of your business.  Names don’t earn protection in the intellectual property sense simply by being the registered name of the business entity, LLC or Inc.  Do you think the name of your company is valuable and should it be protected?  Have you considered trade name protection?  What of your company logo?  Do you think it should be protected?  Have you considered trademark protection?
  3. OK, now you have an LLC.  You may have downloaded forms from the internet, filled them out, filed them and paid your fees to the Secretary of State.  Did you consider by-laws or an operating agreement to regulate internal matters? Have you obtained a federal tax i.d.? Do you have a business bank account?
  4. What about local licenses and permits?  Are any required?
  5. What kind of business are you in?  It seems, no matter your business, folks and potential and hopefully future clients often seek your input and guidance.  They want your ideas.  Do you engage on a handshake after the initial consultation?  Do you think your ideas and experience are valuable and merit protection?  Would a non-disclosure and confidentiality agreement help protect your work? What about copyright?  Have you prepared a design or detailed analysis of a resolution to a problem?  Do you think that work is valuable and do you want to protect it? What do you want should someone run off with your ideas and plans?  How do you protect yourself? What type of intellectual property protection do you need?  Do you have a website? Have you protected it?  While nothing is one hundred percent iron clad guaranty of no such issues, there are steps you can take.
  6. How do you plan to be paid?  Do you extend credit? Are clients willing to pay a deposit?  Should it be refundable, either in whole or part?
  7. What about business liability insurance?  OK, you say, you’re an LLC, thus, you’re shielded from liability.  Right?  Maybe.  If your LLC is undercapitalized or its separateness was disregarded in practice, that shield fails.  No matter what, business liability insurance should be a prime consideration.
  8. Congratulations. You’ve met with a potential client and made a proposal and after some back and forth, you’ve come to an agreement.  How do you plan to memorialize that agreement?  Do you rely on handshakes?  Is your work such that a standard contract can be used across myriad customers?  Where are you flexible in terms? Do you consider using an addendum to detail deal specific terms or do you plan to draft a new contract for each business deal?
  9. My father was of an era where a man’s word was his bond.  It seems those days no longer exist.  What with an ever changing economic climate, minds, and moods, it makes nothing but plain old common sense to be clear with yourself and your clients what is expected of each side.  It also gives everyone a sense of security…each party knows where they stand.
  10. The more you do business, the more you learn.  And, the more you learn, the more you know.  And, we all learn from mistakes.  Do not take any failed deal as a failure.  It is an opportunity.  Take the time to perform an exit interview, even from failed deals.  Write down what worked, what didn’t, why it worked or didn’t, etc.  These will give insight into how to do what you do, business wise, better next time.
  11. As your business grows, and you start to hire employees or independent contractors, myriad issues arise. Employment law is a specialization, whether in fact, if not in law. Lots of folks think they can just call someone an independent contractor and they are.  Not so fast.  There are IRS rules governing what is and what is not an independent contractor.  In a nutshell, the more power you have to dictate time, place, and manner of work, the likelihood is you have an employee, not an independent contractor.
  12. As I indicated at the outset, this is a rough outline.  I shall be editing and adding information, particularly, links, to reading material available online.  At this juncture, I note that Nolo Press (a publishing company … no lawyers!) has a plethora of legal guides designed for the non-lawyer.  Some of them are excellent.  I read two Nolo guides when I opened a consumer bankruptcy practice years ago.  While hardly definitive, and certainly, not authoritative in court, I found them well-written and excellent guides to the basics. There are also professional associations, such as AIGA, that maintain websites that are full of information, guides, and links to other resources.  For mere example, AIGA has an overview of contract proposals designers extend to potential clients, and suggested issues and concerns to be considered, as well as contractual resolution of these concerns. The fashion industry, too, via associations and trade organizations, maintains myriad websites that address topics in areas that are useful to anyone in the business of creating an idea, turning it into a marketable service or product.  I have several links which I will be adding. There may be local and semi-local resources available to you.  For mere example, here in northwest Louisiana, we have Works in Progress Louisiana, a local non-profit whose mission statement is to assist creative entrepreneurs translate artistic endeavors and talents to business.
  13. As always, think ahead, look forward, and never stay in a box.

Stay tuned.  Send me questions.  The more questions you send, the more I know what folks want to know.  If you know of a good resource, send me information.

Kathryn S. Bloomfield


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