US web startup - what legal steps do I need to take


I am on the verge of being ready to launch a new web application. The application charges a small monthly fee to its users. It is hosted on servers overseas.

However, currently, there is no legal company. I am simply running the company out of my (and my confounder's) own pockets.

I know there must be some a) legal requirements and b) things I SHOULD (but don't necessarily need to) do.

Because we are running on very minimal funds, it is important that the investments are minimal as well.

Thanks in advance!

PS - Based in Cali, if that matters at all.

Web California Legal Documents

asked Oct 21 '11 at 16:54
6 points
Top digital marketing agency for SEO, content marketing, and PR: Demand Roll

1 Answer


Assuming it is just the two of you, I don't think there is anything you absolutely need to do at this point. The big question mark for me is if there is anything you need to do regarding your overseas servers. Please update your question with where they are and why.

There are things that you should do:

  1. Before any money comes in, sign an agreement with your co-founder that sets forth the ownership of your business and what you will do with any money that comes in.
  2. Even better, instead of 1, create a corporate entity such as an LLC, S corp, or C corp. This will protect your personal assets from any lawsuits against the company.
  3. Do a Google search and a trademark search (easy to do at the USPTO website) for the name of your company to make sure there is not a similar company using a similar name. If your name is not that distinctive, consider filing your own trademark application.
  4. Depending on your product, you probably want to have an EULA, Terms & Conditions, and/or a privacy policy.
  5. If you are taking credit card numbers, then there are many other things to worry about. Best to not take CC numbers and use PayPal or something similar.
  6. Create a separate bank account and don't mix business funds with personal funds.

That's all I can think of right now. I'll update if I think of others.

answered Oct 21 '11 at 22:58
1,936 points

Your Answer

  • Bold
  • Italic
  • • Bullets
  • 1. Numbers
  • Quote
Not the answer you're looking for? Ask your own question or browse other questions in these topics:

Web California Legal Documents