Blog Review: Startup Law Blog

blog and book reviews

Blogging has been one of the most satisfying endeavors I’ve undertaken business-wise since leaving a corporate firm in 2010 to help build a business law practice at an insurance defense firm. Seeing how valuable the corporate firm brand had been for business development — a benefit I no longer enjoyed — I decided that blogging would be a good way to enhance my reputation as someone who knew what he was talking about. I wanted to focus my business development efforts on providing contract review and negotiation services to corporations, so I blogged as theContractsGuy.

One of the wonderful side effects of blogging that I didn’t foresee was making friends in the blogosphere. One fellow blogger I met while on a business trip to Seattle a couple of years ago was Joe Wallin, who blogged for a number of years at the Startup Law Blog (Joe has since left the firm that hosts the blog and he now blogs at I met a few other awesome fellow bloggers on that trip and wrote about it in Making Friends Through Blogging.

I’ve followed Joe’s blog for a long time, and it’s one of the best blogs about startups around. Although I’m currently focusing my law practice on small business mergers and acquisitions, as well as business law issues (including contracts!) and don’t swim in the startup pond nearly as much as I used to, I wanted to share some of Joe’s best posts. Although Joe’s focus is on startups, many of the articles I’m highlighting in this post are great for general business law issues.

Here are some of my favorite posts:

  • Although Joe prefers C corporations as the entity of choice for most startups, Joe writes about the benefits of limited liability companies in One Benefit Of LLCs–Profits Interests. In the post Joe explains what profits interests are and how they can provide a tax advantage to service provider members of LLCs.
  • Section 409A of the Internal Revenue Code is one of the worst pieces of legislation of all time, and it has reared its ugly head in my clients’ businesses over the years in unlikely circumstances. The legislation was enacted in the early 2000s in response to a few high-profile corporate scandals involving deferred compensation payments to company insiders. The unintended consequences have been vast. Joe provides a quick overview in Section 409A–What Is It? (Joe’s not a fan of 409A either.)
  • A number of small businesses can save on payroll taxes by electing to be taxed as an S corporation. Joe does the math in Can I Save Employment Taxes If I Form An S Corporation Rather Than An LLC?
  • In S Corporation or LLC? Joe discusses the pros and cons of electing to be taxed as an S corporation rather than as a partnership, which is the default tax classification for multi-member limited liability companies. It’s a great read and pretty thorough.
  • I’m often asked what the difference is between warrants and stock options. Joe answers this question in What Is the Difference Between Warrants and Options?, and he also addresses some tax issues relating to the issuance of warrants and options.
  • When founders contribute appreciated property in exchange for equity in the company, the transaction might trigger unwanted (and unanticipated) tax liability. Joe discusses the issues in Do I Need To Worry About Triggering Taxes in Forming a Company?
  • The issuance of equity awards to employees and consultants must conform to Federal and state securities laws. Section 701 can be your friend, as Joe explains in What Is Rule 701 and Do I Need To Worry About It?
  • During times of financial stress companies often have to scramble to keep the boat afloat. One of the main expenses is often payroll. Deferring compensation can cause unanticipated problems. And you should never, ever fail to pay your company’s payroll taxes.
  • Joe also explains “nexus” and how it affects companies’ state tax liabilities in Nexus, What Is It?

Here are several other great posts that are more specific to typical high-growth startups. Although the posts are most helpful for high-growth startups, many of them — especially the ones dealing with stock options and the like — are applicable to other businesses.

  • On What Date Do I Price Stock Options?
  • Participating vs. Non-Participating Preferred Stock
  • What Is A Section 83(b) Election?
  • What’s Better For An Equity Incentive–Restricted Stock or A Stock Option?
  • Why Do Companies Issue Preferred Stock?
  • Imposition of Vesting On Stock in a Financing
  • What is a Repurchase Option?
  • When Does My Capital Gains Holding Period Start For Warrant Shares?
  • Common Mistakes In Starting A Company & How To Avoid Them
  • Terminating S Corporation Status In Connection With A Financing
  • Individual Accredited Investor Certification, In Light of Dodd-Frank
  • Can I Obtain Capital Gains Treatment On My Stock Options?
  • Top 6 Reasons To Grant NQOs Over ISOs
  • Stock Option Grant Checklist
  • What Type of Equity Incentive Should I Use?
  • Section 83(b) Elections and Business Combinations
  • 5 Things To Remember As You File Your Section 83(b) Election
  • Do I Need A Share Reserve to Grant Compensatory Stock Options?
  • 12 Reasons For A Startup Not To Be An LLC
  • SEC “Bad Actor” Rules: Hard On Startups
  • A Tale of Two Exemptions

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