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So I’ve been listening a lot right now. Listening to my clients, listening to what wise (and some not so wise) people have been saying on social media. It seems what everyone is searching for is some sort of control.

Well, my friends. I’m here to tell you there are things you can take control of to help your business navigate these rocky, rocky waters. 

And from my perspective, the best thing you can be doing right now is going through your business owners checklist to make sure your business is as legally protected as it can be.

I hosted an AMA this past Monday on Facebook Live and THE number one topic that people kept asking about was contracts. 

“How can I get out of this contract…?” 

Two clients are trying to get out of a contract with me. What can I do…?

“I didn’t think I needed a contract for that…what should I do…?

Just a few of the many questions I got.

So in response to this, and the very clear need for accurate sound advice on contracts, I decided to come up with a guide. I’m calling it The Anatomy of a Contract. And it’s free!

Let’s get into, shall we?

Time for you to tighten up your knowledge on contracts.

Whether you’re running a startup, working as a freelancer or managing your own business – you’re going to HAVE to deal with contracts, so they need to make sense – and you need to understand what you’re signing and agreeing to (or asking your client to agree to) before you sign.

Traditionally, contracts were long, intimidatingly dense documents that were full of legalese, making them hard to understand. It’s no wonder that most people just sign where they’re told or simply avoid dealing with contracts at all (the good old stick-your- head-in-the-sand approach).

But what if I told you there’s a way to think about contracts that takes some of the mystique out of them! Think of them as a movie script!

Seriously – these are the elements you need to look for in any contract before you sign it:

• Characters = Parties
• Plot = Provisions which set out what the relationship should be like (the terms)
• Obligations of each Party = the “role” each party will play
• Payment/Compensation = self-explanatory – have you seen how much those Hollywood people make??
• Alternative Ending = Escape Route

I’m just giving you the bullet points here, but you can read the rest of this script (LOL) by downloading Anatomy of a Contract: A Free Guide Courtesy Of The Secure Startup. 

As COVID-19 continues to be a growing concern and as I process my own growing fears and honestly, some panic, all of us entrepreneurs, especially startups who may not have saved up significant war chests, need to wrap our arms around the fact that the next little while is going to be challenging.

If there’s any way I can help you get through this, please don’t hesitate to reach out. We all need to support each other – one fabulous woman at a time – and do and share whatever help we can to make sure we ALL make it. Because we are ALL worthy!

Believe it or not, when you do it properly: A contract is one of the best investments you can make in your business.

If you need me, you can reach me by clicking here.

This blog post was originally written by Andrea Henry for Henry Business Law

A client recently called in a panic. She had used an online template to create a contract to present to what she hoped would become a major new client and that client’s legal counsel had come back with plenty of red ink and questions about the draft. After acknowledging that it hadn’t occurred to her that she might be required to amend and explain the copied contract, she readily agreed with me that DIY is great sometimes, but it can often leave you with a flooded bathroom.

While working on her response so she didn’t lose this new client, I thought about how often I’ve seen people advise other entrepreneurs- “You don’t need a lawyer to do that; you can do that yourself!” and how short-sighted that advice is.

It will come as no surprise that I’m not a fan of using online templates and attempting to DIY your contracts or other legal documents without any legal advice and here’s why:

1.Templates are not Tailored to Your Specific Situation

By their very nature, online templates are generic. By copying and pasting from the internet without understanding what the clauses really mean and without understanding what’s necessary in your particular situation, you risk having a piece of paper which gives you a false sense of security but doesn’t protect you from potential liabilities which are obvious to a trained eye.

One example from real life- you take a generic agreement which contains a non-solicitation clause preventing your client from trying to lure away your employees. But what you really want is for your client not to work or lure away other clients because if they work together, their finished product will compete with yours. This actually happened recently and the person who used that generic agreement lost a lot of his business when his clients decided they would rather work together than with him.

2. Contracts aren’t static

As in the case of my client above, it’s often the case that when you present a draft contract for signature, the other party will have some questions or want some changes. If all you’ve done is picked a template from the internet, you won’t know what changes you can safely say yes to or how to word those changes to fit into your template. Especially when you’re dealing with a bigger client who has its own legal counsel, you don’t want to appear to be an amateur who has presented a contract that you really don’t understand.

3. You don’t know what you don’t know

With an online template, you could be leaving money and opportunities on the table; obligating yourself to something unnecessary or missing important clauses peculiar to your industry. You may even choose the wrong template altogether. Frequently, individuals execute a joint venture agreement when really, they have a general partnership. A common mistake is to sign a lease when you really mean to grant a license.

Also, because you don’t know when the template was drafted, you don’t know whether there’s been an important change in the case law or legislation which isn’t reflected in your template and could affect your legal rights or make the whole thing meaningless. For example, did you know that those clauses that try to exclude all liability on the part of the service provider don’t hold up in court unless you have taken very specific steps to bring the exclusion to the attention of your client and your client has had to signal their acceptance of that particular clause?

In an ideal world, you would get a lawyer to draft the contracts for all the key relationships in your business; it as investment in your protection that can save you thousands. When you’re starting up and budget is more of a concern, at the very least have your DIY contract reviewed by a lawyer because what you don’t know can (and often does) hurt you.

If you’re fed up with trying to DIY the legal side of your business, apply to be part of our annual retainer program for entrepreneurs and never have to worry about running your business naked again. To learn more and to apply, click here.

This blog post was originally written by Andrea Henry for Henry Business Law

So last week we opened up a can of ugly worms called why are so many brilliant women entrepreneurs struggling to land much-needed funding? It seriously enrages me, and I want this to change. That’s my goal for this decade. To WAKE LENDERS UP to the new world order when it comes to running a business, to get their heads out of the sand – and out of the 1990s!

So, what CAN you do (or NOT do!) if you’re hitting a wall when it comes to financing your company? There are a few things you can do to help you if you can’t get loans from a traditional bank, credit union, or other type of lending institution.

Investment

You can look for investment, which, in a sense, is less risky than financing through debt (where you are 100 percent liable and will usually need to provide a personal guarantee). Now, of course there are pitfalls to this option – especially if you’re growing rapidly and starting to feel a little…desperate, maybe?  

Imagine you need marketing help, or a sales coach, or an additional employee to help you get to the next level – and someone is willing to offer you their services for, or, I don’t know, a 10 or 20 percent stake in your business – no cash changing hands. Sounds great, right? Almost manna from heaven! I don’t have to pay you and you’re going to give me all the services that I need!? 

And I fully understand that feeling (BOTH the desperation and the relief!). 

But step back a second. What if the hard cost of those services would only amount to $20,000 – and your company ends up being worth a million-plus? 

Well, at 20 percent, you’ve just “paid” $200,000 to get $20,000 worth of services. YIKES! It is an expensive way to fund your growth. 

Look, most of us don’t have wealthy family members or friends to go to in order to secure an emergency loan. Lord KNOWS I don’t! So, if push comes to shove, make sure that you keep some control of your shares. In other words, if you have to give up some of your company, keep control over it through call options or convertible shares, so you can potentially get those shares back later. 

It might be more expensive, but it’s not as painful as if how you’ll feel when your company grows to the multimillion-dollar beauty that you know it can be, and you then realize you’ve given up too much too early. 

OR, you are suddenly attractive to people with those deeper pockets you’ve been clamouring for – but you’ve given away so much of your company getting to that point you’ve become a minority shareholder! Trust me – this happens!

Have a LEGAL Corporate Structure in Place

Whether you’re going for traditional bank financing, or hoping to drum up investors, incorporation is KEY. And I don’t mean just incorporating online and having your certificate of incorporation, but actually going through the formalities, and dotting your Is and crossing your Ts on ANYTHING and EVERYTHING that might need to be reviewed by your potential lenders/investors.

For example, having a shoddy minute book can 100 percent KIBOSH a deal. I’ve seen it happen. Keep your record-keeping absolutely legit and keep a clear distinction between business and personal. I know this is hard when you’re starting out, because generally there will be a lot of fluidity between your personal and business financial lives but your future self will get on her knees and thank you for it.

Most importantly (and not just because I AM ONE   ) please make sure you’re working with a business lawyer who really understands corporate structuring and who understands what it is you want your business to do and where you want it to go. You really shouldn’t just “get the certificate and go” because you run the risk of hurting yourself and your business in myriad ways ESPECIALLY if you expect to become a big business and attract significant funding someday.

Don’t Procrastinate When it Comes to Securing Financing

Now I’m going to give you the hard truth. Debt SUCKS and has the potential to stop your rise before you’ve even gotten started. 

Here’s the thing – MOST of us have been in debt. You’re starting out, you have a dream, you don’t have access to resources or boatloads of money, so you pour everything you’ve GOT (and most if not all that you don’t have, including maxing out credit cards and your line of credit!) – come on now, I know some heads are nodding out there right now – and you’re >this close< to running out of cash and THAT’S when you go for funding. 

Girl. NO!

You will not get financing if you are in debt up to the wazzoo! Even the most liberal of financial managers won’t touch you. 

Go after funding when you still have savings, when you’re regularly paying off your credit cards, when you still have access to a nice chunk in your line of credit. It makes you look financially viable AND financially mature and financially trustworthy. And don’t ever get into debt with Revenue Canada – trust me, no one will touch you with a ten-foot pole. 

Get the best bookkeeper you can (one of the wisest investments you’ll make over the life of your business). And for heaven’s sake, ladies, pay for excellent advice and do it NOW!

You don’t have to be a million-dollar company to seek advice – learn how to accumulate money and then structure things in a way that makes you tax efficient. Or how to present your accounts in an appealing way. Or how to negotiate with those investors we talked about above, in such a way that you DON’T end up losing your company in the end. Plus, the more you know, and the more you’ve done with your company before you start hitting up lenders and/or investors, the greater the chance you will land the money you need to get to that elusive seven figures.

To end, here’s something you should write on sticky notes, and stick them all over your house, office, car, heck forehead even! 

This really stuck with me because it’s SO TRUE – in every area of life: 

WE OFTEN DON’T GET WHAT WE DESERVE. WE GET WHAT WE NEGOTIATE.

Also, I have the tools to help you, if you’re stuck in a rut and not sure how to get out of it. I went through it myself when I was building MY business! So don’t hesitate to reach out for a chat about what we can do together moving forward! 

If you’re serious about growing your business, book a call so we can talk.

There’s so much more I could write about women-led business and the gross sexism that we still struggle with, even in 2020. Yes, it’s getting better, slowly. But we ladies have to work together and elevate each other through this crap – because THAT is the kind of investment we all need right now.