Tag Archives: business advice

Steps To Consider Before Your Startup Issues Stock

stocksIt’s inevitable that start ups will think of issuing stock at one point or another. However, there are some things they need to research and make sure they complete, before they can take the next steps towards stock sales. First and foremost, startups need to seek the approval of the Board of Directors in order to take any steps regarding stocks. In order to achieve the official approval of the Board of Directors, startup executives need to suggest the resolution in a board meeting, or request written consent from the Board of Directors. The board will also have to approve the agreements, in terms of any sales of stocks, and if the startup needs to file any relative government documents, the Board is also in charge of approving these.

The second, but also a very important step a startup needs to take is to seek the approval of the actual shareholders. Usually, a majority needs to vote in favor of the approval of stock share issuance in any agreement. The startup will be responsible for reviewing the Articles of Incorporation or the Certificate of Incorporation of their company. This is mainly to ensure that they actually do have the approval and enough shares, to continue with a new sale of shares. Legally, they will also be responsible for complying with Security laws. While this is considered one of the later steps, is very important to ensure that you’ve been in compliance of the security laws before you actually offer the sale of stocks to anyone else.

 

secDocumentation is everything, always keep a written consent of the Board of Directors’ approval of the sale of stock, as well as a written consent of the shareholders approval. Documents that should also be kept in that same category are the agreement contracts.  Important documents to also keep track of, are the stock certificates. This needs to be provided every time a sale of stock takes effect. Keep in mind, that the following must be completed correctly for each of the stock certificates:

  • This certificate must be dated
  • Number pages for the certificates and the socks
  • *Do not forget to request the signature of an approved executive of the corporation on the stock certificates
  • Keep a copy of every single stock certificate

Make sure that the company’s stock ledger reflects accurately with the issuance of any new stocks. Finally, it is expected that a startup, corporation or enterprise file the appropriate forms with the Securities Exchange Commission, commonly referred to as the SEC, and any other forms required by the state, within 15 days of each sale.

ORIGINAL ARTICLE ON MY COLUMN ON RIGHTSTARTUPS HERE

© C. J. Leger November 23, 2014

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The Achilles Heel of Business Owners

This week I want to start by taking about the serial killers of businesses world wide, all of which are often brought upon the entity by the owners themselves. You see, every business, successful ones mainly, have a few things in common that allow them to strive; and that’s the saying “Be and let be!”.

What does that mean? in life everyone has a role to play, and in business every executive position anchors a hierarchy. Where you are is where you are meant to be, managing the things of your realm. But if you stray and proceed to micromanage every other member of the hierarchy, you risk destabilizing order. You see, you must remove yourself from your duties in order to apply yourself to someone else’s. Every time you do this, the structural integrity of the entire pyramid begins to crumble. This is why you have hired various executives, to execute specific tasks.

Your business is your baby, but you cannot do it all yourself; so you hire others to do the things you can’t. If they are good enough to remain on your team with your supervision, they are good enough to remain on the team unsupervised after a period. Otherwise, you would not have them on your pay list, would you.

But most times business owners result to micromanaging, its because they have a vision of what something should be. And they hire people to execute this vision, however, in the exact way they see it. Which, my friends, is impossible. Every mind is unique and expecting someone to view things as you do entirely just isn’t going to happen.

Look at the most successful businesses in the world. Google for example; this company allows a significant amount of unique thinking from their employees, because they recognize that they’ve hired them for their unique set of skills, which they will apply to their job. But if you hire them for their skills, and expect them to apply your skills to your job, then why are you wasting money on their salary? You might as well do it all yourself. In other words, micromanaging is completely useless.

Expecting the World

Your employment opportunity is set to a certain degree of demand. Most employees will go above and beyond to make sure things to your benefit get done. But they still get paid the same amount for more effort; and its all to your benefit, not theirs. Offering a thankless job is not a good move, no one will stand for it, and eventually your team will move on because being your lackey just is not anyone’s life dream.

Pay VS Workload

Make sure you have a good balance. Although you are offering a quick job, something on the side, if the pay is good for the amount of work, however, there isn’t enough work, many may find it easy to jump ship. Here’s an example. John gets hired to make you 2 info graphs a week for $20 a piece. That’s a “whopping” $40 (note the sarcasm). Although $40 is good for this amount of work, if John gets invited to 4 parties that week, he’ll be very likely to skip out on work, because “what’s $40 now and days”. Get it?

Try offering John 4 info graphs per week. $80 is a lot more appealing than just $40. Yet your price per, hasn’t changed.

Finally I’ll leave you with one more thing to think about. Your life is your business, but your employees do not reap any of the extra benefits it offers to you. Therefore, your business is not their life. Do not expect it to be. No one likes a slave driver.

© C. J. Leger November 14, 2014