Internet startup - Legal terms and company setup

Your best bet is to look at some of the online places to setup a company. I used http://www.nolo.com for a California LLC and it worked great.

For b thru d, I would go find a site you like and see what they have. This stuff is not that hard, you just have to do a lot of digging and research.

10k is really high for this stuff. It's pretty boiler plate for an Internet Startup. Definitely shop around.

Sounds a bit ridiculous for something that is basically several template draft docs tweaked to fit your needs.

a) with so much information here and opensourced by law firms, you can get it done yourself just fine (otherwise you can ping my friends at http://www.vcreadylaw.com) My gut tells me the most cost effective route is to stick with NY corp

b) http://terms-of-service-generator.legalriver.com/

c) http://privacy-policy-generator.legalriver.com/

d) don't need it, TOS should cover it

I am "allergic" to legalzoom and nolo, since I have seen their docs and you can get better quality by spending some time on Scribd.com (that is where many private practice guys/gals tend to get their drafts from).

Lastly, recently there was a great article on the subject by Mark Suster: How to Work with Lawyers at a Startup. Good read, though I don't agree with couple of minor points.

If you were in CA, I would provide the services you are seeking for about half the price you were quoted. I believe that part of the problem is that you went to a lawyer in Manhattan, where everything is too expensive.

You might be able to get away with forming the corporation on your own, using a book from Nolo, if there never will be any other shareholders and you will not be issuing shares to employees or independent contractors. Please see Can I form an LLC without a lawyer? (discusses LLCs, but similar considerations for corporations). (I consider this information and forms provided by Nolo to be better than those provided by online services.)

In my opinion, it is not prudent to copy privacy policies or terms of service from other websites. Those documents must be drafted carefully to properly combine legal protections with business needs. For one small example in this regard, please see Terms of Use and the Digital Millennium Copyright Act (DMCA).

Disclaimer: This post does not constitute legal advice and does not establish an attorney-client relationship.

VJ:

$10K is a little dear. If you go to someone who knows what they are doing your costs should be about as follows:

Incorporation: DE Filing Fees & Minute Book ($599), New York Foreign Corporation Form and Filing Fee ($300) Ancillary Legal Work (Bill of Sale for Stock, First meeting of Directors, First meeting of Shareholders) - ($200) - you should also have a standard agreement for Contractors($100) unless you are hell-bent on having Employees which is a whole different category

Web Site Documents: Customized Terms of Service, Privacy Policy, Disclaimer should take 2 hours to do unless you have something extremely complicated which means it would take 3 hours ($800)

I hope this is helpful to you.

Henry Knoblock www.bostonstartupcompanylawyer.com

I used this company based in NY for contract work and found them very reasonably priced. Their business model is built around lowering the cost of legal services and work with a lot of tech startups.

Here is the link:

http://www.generalcounselsolutions.com

The person I worked with was Gregg Schor, I believe he is the founder.

Best of Luck, Doug

I think the big question is "why do you need all these things?"

1. You can set up a basic corporation using a service like http://legalzoom.com for cheap. The only reason to spend more is because you have some particular need. Like, for instance, you have partners. If you have partners, then you should spend some time with a lawyer before you all get legally bound to each other and work out things like compensation, bringing new partners in, how partners get out, who needs to agree to investments, etc.

2. T&Cs protect you against liabilities. What liabilities does your business expose you to? Granted, only a lawyer will be able to tell you all of them, but you must have some idea on your own. Do you have anything to protect, for instance, personal assets?

3. Whether or not you have a Privacy Policy, there are laws that govern your retention of data. Possibly regulations from entities like your credit card processor too. If you store a lot of data, then you need to be aware of those. If you need a lawyer to be aware of all of this to an appropriate degree to manage your risks, then you should gt a lawyer for privacy consultations anyway, in which case your Privacy Policy costs you close to $0 because you already had that lawyer help consult on your Privacy Procedures. Do you retain data at all?

4. Disclaimer is, as others have said, the same as T&Cs.

It comes down to: if you have little to protect against, or nothing to protect, then go cheap. If you have real assets, or real risks, then you gotta spend what you gotta spend. ($10,000 sounds very high, still, though.)

legal templates for terms of use, privacy policy, term sheets, series A financing docs, software development agreements, NDA, Convertible Notes, and other forms for start ups can be found at www.mystartuplegaltemplates.com

I have used www.legalzoom.com for an LLC last year, and it was a smooth experience. I was informed in every step of my application thru emails, and their online support was fast to answer my inquiries.