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The 5 Biggest Legal Mistakes That Startups Make

Scott Edward Walker

Mistake #5 : not doing your due diligence on potential investors (at 38:36). S corp vs. C corp – “qualified small business stock” . CA exception – CA Labor Code Section 2870: (i) different space, (ii) not using employer’s facilities and (iii) idea/IP is not based upon work done for employer.

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The 5 Biggest Legal Mistakes That Startups Make

Scott Edward Walker

i) Rule 506 preempts State law, which means all you have to do is file a Form D and pay a filing fee; and (ii) no disclosure requirement/PPM Possible to sell to “friends and family” (e.g., issues to address include: How have they treated their other portfolio companies? (i)

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How to Fund a Startup

www.paulgraham.com

I think it would help founders to understand funding better—notjust the mechanics of it, but what investors are thinking. I wassurprised recently when I realized that all the worst problems wefaced in our startup were due not to competitors, but investors.Dealing with competitors was easy by comparison. No, not generally.A