We use our words to make agreements all the time. When we’re young, it’s in our nature to trust that other people will follow through on their word. As we grow older, we realize that not all people intend to hold up their end of a verbal agreement. This is where a legally binding contract can come into play: holding both parties accountable for the promises they’ve made.
Contracts That Protect Your Business
Given the financial nature of business, it’s one of the most common establishments in need of contracts. At a small business, it’s not uncommon to work with family members or close friends, which leads some business owners to think that they can skip the step of contract creation.
This couldn’t be further from the truth! In fact, working with friends and family is one of the top reasons that you do need legally binding contracts in place. And if you aren’t working with them directly, you may still be turning to them for advice and investments. Friends and family invest more than $60 billion in startups each year, and 38% of startup founders report raising an average of $23,000 from their friends and family.
Business contracts can cover a variety of other issues, including:
- Business dissolution
- Non-compete agreements
- Business purchases
- Shareholder agreements
- Non-disclosure contracts
- Employment agreements
- Intellectual property and trade secrets
- Severance and pension packages
Whether you’re an entrepreneur, small business owner, or C-level employee at a larger corporation, we simply can’t downplay the importance of drafting and reviewing your business contracts with an experienced attorney.