Nailing the First 90 Days: Legal Issues Your Venture Will Face and How to Master Them

Launching a startup means making dozens of decisions with limited time, money, and knowledge. Few decisions feel as high-stakes as the legal ones. How should you form the business? Who should own what? What if you’re still working a full-time job while building your idea on nights and weekends?

At Startup Boston Week 2025, Touchstone Strategic Law’s managing partners Michael Perez and Elizabeth Norman pulled back the curtain on the legal choices that define a company’s foundation - and how founders can make confident, practical decisions that support growth instead of slowing it down.

You can watch the full session in the embedded video below to catch every lesson in their own words.

Start With the Business Plan—Not the Paperwork

Perez offered a grounding reminder: founders often try too hard to engineer the “perfect” structure. There isn’t one.

Your legal entity should match where you plan to take the business over the next 3–5 years - not where it stands today. Are you aiming for venture investment? Do you expect to grow quickly? Will you hire soon? Those answers determine whether the flexibility of an LLC or the structure of a corporation makes more sense.

Taxes matter too, but they’re not the only factor. “No decision you make early on is irreparable,” Norman emphasized. Flexibility matters more than perfection.

Delaware Isn’t a Must—But It’s Popular for a Reason

While Delaware dominates founders’ imaginations, it’s not the sole answer. Where you incorporate may depend on:

• Where you’ll hire

• Where your customers are

• Whether you’ll maintain offices

• How much administrative overhead you can handle

Some states are simply more burdensome than others (California, looking at you). Founders should make informed - but not fear-driven - choices.

Equity: Who Gets What, and When?

Ownership is the startup’s currency and the speakers urged founders to take it seriously from day one.

Perez used a memorable metaphor: authorized vs. issued shares is like printing pizza slices before serving them. You start with a large pie (often 10M authorized shares) but only serve a portion at first, typically to founders and an early employee option pool.

Norman reminded founders that equity isn’t just for co-founders. Advisory boards and early contributors may earn a slice, but structure and expectations matter. Vesting, whether based on time or performance, keeps everyone aligned as the company grows.

For unproven contributors, Perez advised leaning on stock options rather than ownership upfront. Option holders don’t receive voting rights until they exercise, and unexercised options can expire if things don’t work out.

If You’re Moonlighting, Slow Down and Read Your Contract

This was the one area where the lawyers didn’t sugarcoat the risks.

Many employment agreements automatically assign intellectual property created during the course of employment - and that may include side-projects. Before coding or prototyping after hours, founders should review their existing IP agreements and carve out their own work clearly.

“When it’s a problem, it becomes a really painful one,” Perez warned.

Patents vs. Trade Secrets: Choose with Intent

A patent shares how something works in exchange for exclusivity. A trade secret keeps it hidden. Both protect value, but in different ways:

Protection	Best For	Trade-off
Patent	Deep technology with investor scrutiny	Expensive, public disclosure
Trade Secret	Fast-moving products and processes	Harder to maintain as you scale

Norman urged founders to weigh cost versus curb appeal. A patent pending application can build investor confidence, but founders need to ensure the spend aligns with business priorities.

Governance: The Mini-Society You’re Building

Filing paperwork is just the beginning, you’re also creating a “little government.” Perez compared early corporate governance to a democracy:

• Shareholders = voters

• Board of Directors = Congress

• Executives = the executive branch

• Articles & bylaws = your constitution

• Board resolutions = your legislation

At the start, founders wear every hat—sole incorporator, board, officer, and shareholder. Formalities feel silly at first, but those habits become crucial as the company adds people, investors, and risk.

Choosing a Name: Slow Down Before You Fall in Love

Every founder has had that 3 a.m. moment where the perfect name strikes. The Touchstone team has seen disasters when domains, trademarks, or competitors clash with that spark of genius.

A great name is:

• Legally clear

• Searchable

• Understandable to customers

The emotional connection is important, but practicality pays off.

Co-Founders: Date Before You Marry

Startups are relationships. And like relationships, they’re easiest to handle when expectations and roles are clear before the honeymoon ends.

Take your time:

• Share ideas

• Test collaboration

• Define contributions

• Set economic terms

“When things go well, you’ll still disagree,” Norman reminded the room. Clear agreements protect the company and the relationship.

The Bottom Line

Founders don’t need to become legal experts. But the sooner they adopt a structured mindset, the easier it becomes to scale - and the fewer traps they’ll stumble into later.

Perez summed it up well: legal decisions don’t have to be perfect. They just need to support your business goals and evolve as the company grows.

Watch the Recording

If you want to dive deeper into the strategies and founder wisdom behind their journey, you can watch the full recording embedded above or right here on YouTube. It’s packed with hard-earned lessons every startup leader should hear firsthand.