The Importance of a Proactive Legal Approach to Your Business

Written by: Kristin K. Bailey, Esq. 

A new business idea. A new project. Plans to take your business to a new level of financial growth and popularity. If you're a small business owner, all of these aforementioned items probably fuel and excite you as you plot to take over your particular field of expertise and develop your presence within your industry. As you plot away, you definitely want to take into consideration possible legal implications of the decisions that you're making. Oftentimes, it is easy to get caught up in various business growth plans without considering necessary risk-averse legal processes that would prevent negative legal and financial pitfalls along the way.

In essence, you want to take a proactive approach to legal with your business. A proactive legal approach, in my opinion, all comes down to issue-spotting. Having an attorney in your back pocket for consulting purposes is always a good idea when it comes to issue-spotting (remember: that's what they are trained to do). Before you launch a new business idea, you will likely need certain contracts to protect your idea. For example, if you intend to work with an industry expert/consultant on a particular idea, you may want the consultant to sign a well-executed confidentiality agreement in order to prevent the consultant from sharing details of your initiatives with others who are in a position to profit off of them.

Or let's say you intend to associate a particular trademark with your business. I sat in a business conference where a presenter advised successful business owners that if they come up with a great trademark, they should just start using it and put a little "TM" next to it in order to legally protect it (or look like they are legally protecting it). I cringed when I heard this advice. I further cringed when she laughed at the fact that well, she wasn't a lawyer and didn't check with a lawyer first so it wasn't legal advice, but her advice worked for her and hasn't gotten her in trouble yet, so why not share it with everyone in the audience?

Her comments were cringe-worthy for a couple of reasons. Well, sharing legal advice without having it first vetted by a licensed attorney is probably a bad idea (and it's not a laughing matter, especially if you wind up in court after taking such advice). Also, relating to her commentary, it wouldn't make much sense for me to use the tagline "Just Do It", for example, just because I happened to "come up" with it one day and it happens to flow with my business name. Adding a "TM" next to it would just add insult to injury! Why? If Nike found out, the company would be within its legal right to pursue legal action against me for attempting to use the tagline. Nike owns it! A proactive approach by either you or your attorney would involve doing a thorough search to find out if someone already owns or is using the name/tagline /etc. that you're considering in order to avoid possible issues down the line.

A more subtle business idea killer that business owners don't always think about are internal policies that should be in place in order to prevent internal bleeding of ideas via disclosure online through

employees. Let's say you are a business owner and you have a staff meeting where you share with your employees that you're about to launch a new beauty product line that is about to revolutionize the cosmetics industry. You want your staff to be on board, so you share the news and get them ramped up for this new adventure, right? Sure, I understand. But let's think about one of your employees (let's call her "Susie"), who is so hyped about the product launch that she immediately goes on Facebook upon returning to her desk to share some essential details on her wall about the new product with her friends. From Susie's perspective, she is excited about her work and wants her friends to know about it. Did she read, understand and sign a confidentiality agreement or a social media policy that would prevent her from sharing these details on Facebook? I hope so. Because guess what: one of her Facebook friends is connected to one of your biggest competitors. The friend subsequently shares this information to said competitor. Time is now of the essence to launch this product, and you have a competitor on your hands without you even knowing about it - yet. A proactive approach to preventing this type of disclosure would be to enforce a social media policy and/or confidentiality agreement that would prohibit employees from disclosing confidential information about your business. 

These are just a couple of examples of how small business decisions could have a massive impact on a company. It's essential to have an attorney help you develop a 360-degree legal approach to your business strategies and "issue-spot" possible weak spots in your strategic direction from all angles that may require some type of legal action in place to avoid problems down the road. In my opinion, you're much better off taking as much precaution as possible ahead of time to avoid winding up in court or financial penalties in the future. 

How to Become the Trusted Authority with Your Business: Two Case Studies

One of the things that sets businesses apart in today's fast paced online world is where they stand as the authority in their field. When you’re considering becoming an entrepreneur, one of the first things you should ask yourself is: How can I carve out my own niche and become the authority in my field? Many would-be entrepreneurs leave their dreams on the shelf because they feel like they are not the authority on anything that they can monetize or that someone else holds the position of authority in their desired field of  expertise.  Believe it or not: Your position of authority is not as hard to attain as you may believe. I have listed below 5 key ways to position yourself and your business as the authority in your given market and have also provided two great business case studies. 

• Create a perceived need for your product or service. Just because you believe there is no need for your particular product or service doesn’t mean you can’t make money with it.  Basically what you as the entrepreneur need to do is create the perception of a need for your product or service.  In this case, the only thing holding you back is your creativity in how you create that perception of need in consumers. Remember: Consumers are inundated with ads everyday which create the perception of a need for many useless products.  While we all know your product is not useless, remember that people created a need for products like those little bullet blenders in the infomercials.
• Be the first. Being the first business to offer your particular unique product or service speaks for itself.  When you’re the first, you’re immediately set apart as the authority on the matter.  Being the first to produce your product or service not only makes you the authority in the minds of consumers but it also puts you at a great advantage when it comes to SEO (Search Engine Optimization).  Do you already feel like there is another “first” in your field? Think about a particular niche, product or style of delivery that will set you apart from that other authority so you can carve out your own distinct platform in your field.
• Market your experiences. In your particular field of expertise you’ve gathered specific experiences in this field.  Marketing this experience and building your social proof behind this experience set you apart as the authority on any subject matter.
• Attain authority by repetition. If you ever look at politics and in particular political races, you’ll notice that politicians have learned that repetition is more than enough to convince people that what they are saying is truth.  At the height of political seasons, you’ll see plenty of attack advertisements that the fact checkers have said are false yet the public still believes them.  This is because repetition often is enough to convince people that you’re an authority and that your statements are true. Does this mean that you should be running advertisements speaking of your authority? No! But what it does mean is that you should be demonstrating your authority.  Constantly writing blogs, ebooks and speaking engagements in your area of expertise are the repetitive proof that you need to place you as the authority in your area.  Also, utilizing every opportunity to speak of your authority builds your social proof.
• Find a business model and improve it. In business there are times when it feels like the thing you are the authority on has already been capitalized on by someone else.  Don't let this dissuade you from launching your business and positioning yourself as a leader.  Take what has already been done and make it better.  Of course this requires some creativity on your behalf but the reality is any business or subject matter can be made better if you’re willing to bring a fresh perspective.

TWO BUSINESS CASE STUDIES

Here are two business case studies centered around two women that have perfected the art of becoming an authority in their chosen fields:

First Case Study: Kerry Ann Rockquemore, CEO of The National Center for Faculty Development and Diversity

A perfect example of entrepreneurs who have created their own perception of a need for their service are Kerry Ann Rockquemore and her husband William Haupricht of National Center for Faculty Development & Diversity.  This married couple has taken the academic world by storm in just a few years by creating the perception of a need for Mrs. Rockquemore's strategies on how to become a successful faculty member in today’s academic institution. By creatively leveraging the successful elements of other million-dollar online businesses, she has been able to set herself apart in the academic world as the premier faculty professional development authority. As a result, her business, which is in essence an “outsourced” faculty professional development center online, has been able to cross the million-dollar revenue mark and continues to attract faculty and graduate students around the world.

Mrs. Rockquemore, a former tenured professor and the core of the center, believes that American universities do not provide adequate professional development services for their faculty members (especially faculty of color and women) and decided to create a highly profitable online business that primarily capitalizes off of 1) providing a toolset for faculty of color and women to navigate the political landscape of academia, and 2) the desire of faculty of color and women to achieve tenure in academia. The National Center for Faculty Development & Diversity literally wrapped their services within the buzzword of diversity, which makes it far more marketable to institutions across the country.

Let's hone in on this for a second: By zeroing in on the keyword “diversity,” Mrs. Rockquemore has been able to set herself apart as the premier authority on diversity in the academic world. In today’s society, the word “diversity” is an effective marketing tool, in academia and business alike.  The combination of this fact with the stellar selling ability of her husband, William Haupricht, creates an incredibly lucrative online business based out of downtown Detroit, Michigan.

While any tenured professor could easily utilize this business model and attract a following, Mrs. Rockquemore beat them all to the punch with a formula to achieve tenure, a successful sales strategy, and a high-end pricing model that creates scarcity in order to persuade the decision makers at some of the top universities in the nation.  While her formula is not necessarily unique and mimics the strategies that universities already utilize on campuses as a track for achieving tenure, she has been able to creatively repackage these strategies via institutional memberships, individual memberships and “bootcamps” through her company, providing a support system for professors aiming to win tenure at their institutions.  Her success is a perfect model today for how to position yourself as the authority in an arena where there is no actual authority.

Second Case Study: Michelle Phan, Owner of Ipsy and the Michelle Phan YouTube Channel

Michelle Phan is another example of a successful online entrepreneur that has been able to shape herself as an authority in an incredibly competitive field: the beauty industry. She has been able to creatively package existing beauty knowledge and leverage her natural talents and skills in order to create entertaining beauty videos on YouTube.  In addition to creating one of the most popular YouTube channels, she is the first-ever YouTuber to be hired as a premier beauty brand’s video makeup artist (Lancome) and has created an already lucrative competitor to Birchbox: her new company called Ipsy.

Michelle Phan was not the only makeup guru or the only YouTube beauty channel when she created her channel in 2006. In fact, she is a self-taught makeup guru who began her artistic training at the age of 12, teaching herself how to paint with watercolros and oil paints. Initially interested in a career in dermatology, Ms. Phan decided to pursue her love for beauty through “vlogging” on her YouTube channel.  From the inception of her channel, she implemented essential elements of branding and marketing in her videos that made them incredibly entertaining, addictive and most importantly: viral.  

What makes her videos so incredibly enticing? I’ve watched all of her videos and have noticed a consistent theme across all of her videos: A relaxing voice, mellow/hip music, consistent video editing style (all the way down to the fonts and transitions), excellent lighting and high quality video, consistent video publishing, entertaining storylines surrounding her makeup tutorials, a wonderful personality (That makes you feel like she could be your best friend), and excellent instructional content and beauty tips.  To top it off, she isn’t intimidating and she is relatable to her fans.  The consistency of all of these elements across all of her videos provides the unique mélange that launched this YouTube star into her own unique territory of fame and authority in the beauty world.  

She not only made herself an authority in the beauty world on YouTube, but she also created a popular skin care line, IQQU, and now ventured into Birchbox territory with the creation of Ipsy, which is a company that ships out quality beauty products to subscribers on a monthly basis and also supports a growing community for sharing beauty and style products. Capitalizing off of her YouTube fame and authority, she has been able to set herself apart in the “beauty box” monthly subscriber world (where Birchbox was the authority) and build up a loyal following who will subscribe just for access to her favorite products of the month.  Specifically, she took the Birchbox business model and made it better. In essence, Michelle Phan has been able to carve out her own niches in the beauty world, leaving competitors in the dust with a loyal following that will listen to her every word. And it all started with a girl, a camera, and a love for beauty.