Form Company/Entity

Why is this Important? You need an entity in order to own IP, issue stock, receive funding, etc.

Key Actions Things to Consider Tool Kit
Get legal advice on forming an entity What type of entity is best at this time– LLC, C corp, etc?

  • Become familiar with the different types of structures and their advantages/disadvantages

Do you have a good attorney?

What state should the company be formed in?

Consider hiring law firms who will perform this task with deferred payment

University of Washington Entrepreneurial Law Clinic

Entity Formation Definitions

Determine if an investment memorandum is needed Is it needed to raise seed money to continue development?
Finalize a Founders Agreement Are founders satisfied with respective shares of the business?

Founders shares granted during the company formation can be very inexpensive

  • Retain a lawyer to help with granting of shares as there are important tax implications/tax elections with limited time windows for action.
Determine Capitalization Plan How much stock should be issued and what type? Capitalization Table Templates
Obtain a technology license or obtain a Letter of Clearance from your workplace declaring that they don’t own the technology Who owns the IP?
Transfer IP to entity Inventors get equity for value received with IP assigned to the company

It is rare that royalties are granted to the Inventors after company formation

Determine need for Board(s) of Advisors Types of advisory boards to consider:

  • Technical
  • Scientific
  • Clinical/Medical
  • Business
LSWI Consulting
Determine need for Board of Directors
  • At least 1 person required for a C corp
  • Size & composition depends on Articles of Incorporation