At some point, all businesses need legal help. You may need help when you actually start the company, when you protect your intellectual property or when you want to divide ownership. Of course, you will need legal assistance when you face legal issues.

For a startup founder, the legal implications of creating a business, developing and launching a product, pulling together a team, and selling the product are overwhelming. It's simply too much, and you'll need help from a professional attorney. A good attorney will help you tackle the legal issues before they become real problems and come back to haunt you.

So, what should you do? What are the main legal issues you should focus on when creating a new company? Here are some of the top legal tips every new entrepreneur should know about:

#1 – You'll need legal help a lot sooner than you think

You'd be surprised, but you'll likely need legal help even before founding your new company. Most entrepreneurs think that their legal problems will only start after several years of activity, but that is often false. This is because most entrepreneurs first create their product or service, and only after they create their company. By the time the company is established, the product is already in its final stages of development, so legal concerns may arise. Try to get ahead of these problems by talking to an attorney, preferably before you develop the first prototype.

There are many issues that can catch you off guard. For instance, “volunteer contributions” and co-founder ownership issues are quite common for budding businesses. These initial arrangements may not be clear for everyone involved, and legal problems can occur. To avoid this, try to talk to an attorney and get legal help when drafting documents.

#2 – Free legal advice – use it!

Starting a business is challenging when you don't have adequate financial resources. Legal assistance is often something you want to push off until later. After all, legal services are usually expensive, so this is perfectly normal. However, dealing earlier with important legal issues is better and far cheaper.

Many intellectual property attorneys provide discounted services to entrepreneurs and budding businesses. Some law firms even offer free legal services for startups. What's more, almost all business incubators work with intellectual property attorneys who provide free legal advice to young entrepreneurs. These programs are also offered by many universities that are active in the business environment.

Make sure to do your research before starting your company. There are many organizations that help entrepreneurs and provide free legal advice. Just keep in mind that these services are limited – you will eventually need professional assistance from an intellectual property attorney, especially in the long run.

#3 – Establish the legal entity

This is the first thing to do when creating a company – establish its legal entity. Unfortunately, this is a problem for many entrepreneurs. Forming an entity is the first thing to focus on – it's the document that protects your venture's assets and reduces your personal liability.

There are three types of entities to choose from: an LLC (also known as a limited liability company), a corporation, or an S-corporation. There are other types of entities, but they are rarely used by entrepreneurs, such as sole proprietors or limited partnerships.

Depending on the type of entity you choose, you will have to file in various documents. For instance, if you choose an LLC, you have to provide an operating agreement that defines the equity ownership, member voting rights, and management duties. Every type of entity requires a different set of documents – make sure to talk to an attorney to learn more about them.

#4 – Don't forget the taxes!

Taxes are usually not a priority for budding businesses, but they should be. Make sure your taxes are in order before starting the business. Otherwise, you may encounter legal problems and financial difficulties down the road.

Get your taxes sorted out before raising money. Nobody will want to invest in a company that has tax problems or has an unclear financial situation. It's a red flag for possible investors, and you may lose a lot of money. What's more, your reputation will suffer, affecting your company's success.

#5 – Choose between a trade secret or a patent

Do everything you can to protect your idea. The idea is the core of your product and your business, so you should protect it at all costs. If it's a good idea, someone else may want to steal it and use it for their benefit.

The most important legal tool to protect your idea is the patent. According to the US Supreme Court, “anything under the sun that is made by man” can be patented. There are two types of patents – the utility patent (which covers how the invention is made and works), and the design patent (which protects how the invention looks).

You can also protect your invention by treating it as a trade secret. This is how major brands protect their recipes – KFC for its KFC Original Recipe and Coca-Cola for their range of soft drinks. They use trade secrets because they don't want to disclose the recipes – if they would apply for a patent, the recipes will have to be disclosed to the public.

#6 – More protection for your intellectual property

There are more ways to protect your intellectual property. Talk to your attorney to learn more about copyright, trademarks, and non-disclosure agreements. If your new company sells complex products, try to use all of these protection tools. As your business grows and builds traction, you'll need complex legal protection tools, as rival companies will want to copy your ideas.

Copyright can be useful for many companies, as it protects any idea that can be put on paper or another type of format. Registered copyrights provide useful additional protection for larger companies. On the other hand, trademarks can be used to protect brands, like logos and packaging (the Nike swoosh and the Coca-Cola bottle).

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