L.A. TECH & MEDIA LAW FIRM – Intellectual Property & Technology Law

Tech Startup Due Diligence

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When entrepreneurs, software technology startups, and small businesses start to think about launching a new product or a new promotion campaign, or forming strategic partnerships, or perhaps even funding strategies, legal due diligence for tech startups becomes an important component in the larger operational plan of a new venture.

legal due diligence for technology startups LA tech and media law blog Los Angeles New York Nevada California Attorney and Law Firm Protecting Intellectual Property Assets Malibu
Legal Due Diligence in Technology Startups

The technology startup legal due diligence process can take many forms. Various components of the business will be analyzed to ensure that they have been thought through in a competent fashion, planned effectively, and are in position to be executed. Another component of due diligence involves legal due diligence.

Legal Due Diligence Components

Legal due diligence for a technology startup implicates almost every aspect of the company.

Technology startups going about their legal due diligence may consider company formation as an integral first step, including the various ways that a corporation or a limited liability company (LLC) may be structured, in various jurisdictions such as California, New York, Delaware, Nevada, Wyoming and other states. In addition, agreements between cofounders memorializing their understanding as to duties and respective equity splits may be considered as part of this legal due diligence step.

Tech Startup Trademark Due Diligence

Another component of legal due diligence for technology startups is trademark due diligence, and trademark protection. Trademarks protect brand names, logos, and slogans, and are almost always one of the first elements of legal protection and legal due diligence a technology startup considers, and goes hand in hand with the company naming process during corporation formation due diligence.

Trademark due diligence for technology startups is generally broken down into several steps, including doing a prior search in conflict on the brand and logo, and analyze for likelihood of confusion or descriptiveness. After the trademark conflict search due diligence is complete, filing a federal trademark application in the United States Patent and Trademark Office is generally the next step in due diligence to protect the trademark while the product is being developed and the technology startup is approaching its launch date.

Tech Startup Contract Due Diligence

After trademark due diligence and due diligence on company formation in in place for the technology start up, another component of due diligence almost always includes contracts. Contract due diligence takes many forms including deal structuring and contract drafting. Each contract is different because each deal is different. Contract clauses addressing matters such as the scope of work and confidentiality are among the contract terms that are negotiated during the due diligence process.

Tech Startup Due Diligence
Technology Startup Contract Due Diligence

Due diligence is a critical element of launching a technology start up, and takes many forms involving the product, the promotion, the funding, the intellectual property, and deals in place. Legal due diligence in the form of trademark and copyright protection, patent protection, and contract due diligence are without exception a make-or-break component of successful launch of a technology startup.

Consultation with an experience technology startup attorney that is an expert in legal due diligence and product due diligence in the technology software and hardware industries is unquestionably the smartest move a technology start up can make when embarking on their due diligence strategy.


Picture of David N. Sharifi, Esq.
David N. Sharifi, Esq.

David N. Sharifi, Esq. is a Los Angeles based intellectual property attorney and technology startup consultant with focuses in entertainment law, emerging technologies, trademark protection, and “the internet of things”. David was recognized as one of the Top 30 Most Influential Attorneys in Digital Media and E-Commerce Law by the Los Angeles Business Journal.
Office: Ph: 310-751-0181; david@latml.com.

Disclaimer: The content above is a discussion of legal issues and general information; it does not constitute legal advice and should not be used as such without seeking professional legal counsel. Reading the content above does not create an attorney-client relationship. All trademarks are the property of L.A. Tech & Media Law Firm or their respective owners. Copyright 2024. All rights reserved.

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