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The 5 Biggest Legal Mistakes That Startups Make

Scott Edward Walker

not an LLC or a partnership; the world of startups is the world of corporations. Rule #1 : only sell “securities” to “accredited investors” – why? (i) Crowdfunding exception to “accredited investor” – SEC rules not promulgated yet. Mistake #5: Not Doing Your Due Diligence on Potential Investors.

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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)