Making Apologies as a Small Business Owner

by | Dec 14, 2016 | Business News

Making Apologies as a Small Business Owner

After Wells Fargo CEO and Chairman John Stumpf stepped down following news of two million bogus accounts opened by employees under pressure to meet sales goals, a new CEO was culled from the ranks and put in charge. One of Tim Sloan’s first tasks as the new CEO of Wells Fargo was to reassure his employees and customers that things were going to get better. One thing is certain – before offering up his apology and presenting his plans to turn things around, he had legal advice. You may never face a televised congressional hearing evaluating your business practices, but you may someday find yourself making apologies as a small business owner. Here are three tips for getting the apology right, and some thoughts on when you may need legal advice.

1. Fix the Problem

This may seem obvious, but your apology will not have clout if the situation that allowed the problem to occur in the first place still exists. In Tim Sloan’s case, try to imagine that how effective his apology would be if his employees and the public knew customers were still being sold products they didn’t want, need, or authorize. You may need to make difficult choices to make sure you’ve fixed the root cause of the problem that lead to the need for an apology, choices which could include letting people go, changing the structure of your business, or altering your sales practices. If so, make sure you obtain legal advice before you fix the problem. If it’s a simple issue that can be resolved with simple changes to procedure, you may not need to talk to an attorney. But if your solution includes a major change to policy or practice, or a remedy that could expose you to risk, you should consider legal advice.

2. Make Sure Your Employees and Customers Know They Are Valuable

Regardless of what went wrong, even if the mistake that was made was an honest or unintended one, your customers and employees may be wondering if you value them. In the case of outright mistreatment – such as Wells Fargo employees being fired for reporting unethical behavior, or outright fraud – such as Wells Fargo opening unauthorized accounts for their customers – employees and customers will feel used and distrustful. But even if you simply made a mistake, or are facing a situation out of your control, people may wonder if you care about them, or if you carelessly “let this happen.” Make sure your apology includes a confirmation of caring that goes beyond your words if possible. Put yourself in the shoes of those who feel harmed. Is there anything that could make it better? What ever your solution involves, make sure you employees and customers know they are valuable to you and to your business.

This is another good point to consider legal advice. You need to make sure that what you offer in the way of making things right does not expose you to unintended legal consequences. Find a business attorney in Colorado and check in. This is one of those times when legal help in advance can make a big difference.

3. Listen to Employees and Customers

Advising you to listen to employees and customers who are impacted may seem like the first step, but I’ve placed it at the end because this is a two part listening practice:

  • You need to listen to all parties to understand what went wrong and why they are upset. Understanding why they are upset is as important as knowing what went wrong. When you make your apology, and you explain your steps to correct the problem, it is essential that you also be able to apologize to people about how they were made to feel. Do people feel they may no longer be able to trust you to keep promises? Are employees afraid you’re not paying attention to issues that could impact their livelihood? Don’t assume you know what they are feeling. Ask, and listen.
  • You also need to listen to feedback on your solution before you present it. Find a small group of key individuals and ask for their input as you formulate a solution and before you present it. Their feedback will be crucial to understanding the impact of your apology and how your solution might be viewed by those who are counting on you to make things better.

One final note on listening: make sure your listening process offers anonymity. Some people may not want to tell you what they knew about the problems in your organization before and after they surfaced – they may look at Wells Fargo as an example of what could happen and worry they could be fired. You will not be able to come up with the complete picture, and thus a viable solution, if you don’t get the full story.

Making apologies as a small business owner may not be easy, but if you are well prepared, it can make a real difference. If you need helping understanding the legal ramifications of a less than desirable business situation that may require an apology on your part, or crafting a solution that doesn’t compromise you legally, I can help with business coaching, or a business planning consultation to help you move forward. For any type of Colorado small business legal review, contact me, Elizabeth Lewis, at the Law Office of E.C. Lewis, P.C., home of your Denver Small Business Attorney. Phone: 720-258-6647. Email: elizabeth.lewis@eclewis.com

Contact Us Today

Law Office of E.C. Lewis, P.C.
Your Denver Business Attorney

LICENSED IN COLORADO AND NORTH CAROLINA

Mailing Address:

501 S. Cherry Street, Suite 1100
Denver, CO 80246
720-258-6647
Elizabeth.Lewis@eclewis.com

Online at:

Financing My Small Business: A Brief Overview of Venture Capital

by | Sep 6, 2016 | Business News

Financing My Small Business: A Brief Overview of Venture Capital

You’ve got your great idea. Maybe you even have an enthusiastic co-founder, a five-year business plan, or an eye on the perfect office space. But what you don’t have are the funds to realize it all.

You’ve probably heard about venture capitalists or angel investors; it’s hard to live in the world of Silicon Valley start-ups and not have. So what are your options when it comes to raising capital for your own venture?

Traditional financing sources for small businesses tend to be banks and credit unions who use standard criteria to decide if you’re a viable loan option. They may be interested in your business idea, your background/track record, the amount of skin you have in your own game, and, naturally, your ability to repay the loan. Pretty simple.

The venture capital worlds operate a little differently in that they:

* invest equity capital, rather than debt
* take higher risks in anticipation of higher returns
* have a longer investment horizon
* are directly involved in the company (a Board of Directors’ seat, strategy planning, or governance)

Three main types of investors and approaches exist within the venture capital space.

Private Equity (PE) – PE incorporates a number of investment options that are usually made by private individuals/institutions.

Venture Capital (VC) – This is under the umbrella of private equity, but is managed differently and is usually designed to fund start-ups that have the potential for high growth (hello, technology companies). In addition to money, VCs provide business planning expertise and assistance.

Angel Investing – Angel investors are often entrepreneurs who have retired early — and well — who seek high returns through private investments in start-ups. They provide similar financing as VCs, just in smaller amounts. Angels often want a seat on the Board of Directors or even a daily role in the company’s operations.

Usually, the venture capital process looks like this:

1. Review business plan — the VCs review the plan and decide to move forward if it seems like a fit. Most are interested in an industry, a particular location, or a specific stage of development (start-up, early, expansion, or later).

2. Perform due diligence — this is the part where the VCs take a careful look at your proposed management team, products/services, governance documents, and especially financial statements.

3. Make an investment — money gets invested in exchange for company equity and/or debt, usually in rounds of financing.

4. VC involvement — once the investment has taken place, the VCs get involved in the running of the company.

5. Exiting the company — VCs generally expect to exit the company roughly four to six years after an initial investment, either by a merger, an acquisition, or an IPO.

If you need legal help, don’t hesitate to contact me at the Law Office of E.C. Lewis, P.C., home of your Denver Small Business Lawyer. Phone: 720-258-6647. Email: elizabeth.lewis@eclewis.com.

Contact Us Today

Law Office of E.C. Lewis, P.C.
Your Denver Business Attorney

LICENSED IN COLORADO AND NORTH CAROLINA

Mailing Address:

501 S. Cherry Street, Suite 1100
Denver, CO 80246
720-258-6647
Elizabeth.Lewis@eclewis.com

Online at:

Small Business Work-Life Balance

by | Apr 15, 2016 | Business News

Small Business Work-Life Balance

Work-life balance is one of those issues we often hear about when it comes to employees, but what about small business owners and entrepreneurs?

Being a small business owner is challenging. It takes a lot of time and energy in order to keep the business going and growing. This can often lead to the assumption that the more time you put into something, namely, your business, then the more you will get out of it. Right? Maybe, maybe not, but you should try and be smart about it.

Consider this, studies show that the belief that multitasking is a powerful productivity tool is a myth. If you are in the middle of a personal, non-business task at home for example, then it might be a good idea to finish that up and then take care of that business matter later. Of course there are always exceptions, emergencies do happen, but do not automatically assume that making your business your number one priority will always lead you to better business results. If you come back to that business task with your full attention, you will likely complete it better and in less time.

Another way to help you obtain a better work-life balance would be to set aside one day out of the week (or maybe even the whole weekend if possible) to not do anything business-related. Think carefully about what day you choose, and make sure it is one that can work for you. For example, if your business gets an important delivery on Saturdays where there are commonly questions or problems with it, then that might not be a good day to choose. This can allow you to decompress, get some greater perspective, and then be ready to jump back into work more inspired and reinvigorated. Burnout is real, and taking steps to overcome it or prevent it now will reward you and your business over the long-term.

A common problem with work-life balance for small business owners is when you operate a home-based business. When you are in this situation, it can be hard to ever feel like you are off-the-clock and actually able to relax in your own home. If you are in this situation, consider limiting all of your business operations, equipment, inventory, et cetera, to one or two rooms in your home. If you have business items strewn across the house, you will likely find yourself thinking about work everywhere you go at home. Additionally, if you do all of your work at home, then it might be a good idea to keep a strict schedule for yourself of working hours. Get in a routine. Together, these tactics should train your brain to focus better on your business by concentrating both when and where you work in a common and predictable way for yourself.

Whatever your small business’ circumstances, it is crucial that you give it 100%, but you cannot do that if you are trying to work 100% of the time. We are all human after all, and we need to eat, sleep, get some rest, and spend some time with our families in order to be at our best on the job. So try and strive for a reasonable work-life balance for yourself, and you will likely be a better person and business owner for it. Lastly, remember not to feel guilty for taking some time out or else you likely will not experience the benefits of rest and balancing your work and the rest of your life. Just give it a try and see if it works for you.

If you need legal advice for your business, or are ready to start a new business of your own, then don’t hesitate to reach out and contact the Law Office of E.C. Lewis, P.C., home of your Denver Business Attorney, Elizabeth Lewis, at 720-258-6647 or email her at elizabeth.lewis@eclewis.com.

Contact Us Today

Law Office of E.C. Lewis, P.C.
Your Denver Business Attorney

LICENSED IN COLORADO AND NORTH CAROLINA

Mailing Address:

501 S. Cherry Street, Suite 1100
Denver, CO 80246
720-258-6647
Elizabeth.Lewis@eclewis.com

Online at:

Craft Beer is a Billion-Dollar Economic Driver in CO

by | Apr 7, 2016 | Business News

Craft Beer is a Billion-Dollar Economic Driver in CO

As today is National Beer Day, what better way to celebrate than talking about beer! According to a study released by the University of Colorado’s Leeds School of Business in association with the Colorado Brewers Guild, small, locally-owned breweries had an overall economic impact of 1.15 billion dollars on the Colorado Economy for the year of 2014, and it employs over 6,000 workers in Colorado.

This is good news for Colorado as one of the top craft beer brewing states in the country. At the end of last year’s count, there were 261 craft breweries in Colorado, with more and more popping up all the time. The latest figures now have the count at over 300! Altogether, this means that you likely don’t have to go very far to find excellent beer in or near your neighborhood. These Colorado craft beer brewers are made up of small businesses that simply love great beer and Colorado. They just want to share their passion with others, and consumers have been buying.

Overall, the craft beer takeover is not showing any signs of slowing down yet, but how long can it continue to grow at these rates? This is growing concern. How much is too much craft beer in one area? As far as the national numbers go, craft beer is still only sitting at just over 12% of the beer market share, but more locally, the market may be experiencing a lot more crowding. The growth and interest in craft beer is likely making the bigger, national brewers nervous too, who may be looking to buy some of the smaller brewers or get more creative with their own beer offerings to try to compete.

Another ongoing concern for craft brewers is a potential ballot initiative that would allow for grocery stores and other big retailers to be able to start selling full-strength beer inside, an issue we discussed previously here. They fear this could lead to more consumers opting for buying some of the more national brand offerings at these larger stores rather than going to their local liquor stores who tend to have large selections of local, craft beer offerings. Then there is also the impact on local small business liquor store owners being affected by the change as well. Craft beer is certainly an industry worth watching here in Colorado, whether you work in small or big business.

If you need legal help for your craft brewery, then don’t hesitate to reach out and contact the Law Office of E.C. Lewis, P.C., home of your Denver Business Attorney, Elizabeth Lewis, at 720-258-6647 or email her at elizabeth.lewis@eclewis.com.

Contact Us Today

Law Office of E.C. Lewis, P.C.
Your Denver Business Attorney

LICENSED IN COLORADO AND NORTH CAROLINA

Mailing Address:

501 S. Cherry Street, Suite 1100
Denver, CO 80246
720-258-6647
Elizabeth.Lewis@eclewis.com

Online at:

Deconstructing Payroll Taxes for Your Small Business

by | Mar 16, 2016 | Business News

Deconstructing Payroll Taxes for Your Small Business

If your small business employs people, no matter how few, you’re required to withhold payroll taxes from their paychecks and pay federal, state, and local taxes (this is one of the reasons small and especially micro businesses may opt to use independent contractors, to whom they don’t pay benefits and who pay their own taxes).

Usually, withheld taxes are comprised of FICA (Medicare and Social Security taxes) plus federal, state, and local income taxes where applicable. Additional withholding obligations are the Federal Unemployment Tax (FUTA) and in some states you must withhold disability insurance tax — check your state’s tax laws to make sure your bases are covered.

Before you launch your small business, make sure your accounting system is solidly in place. If you don’t pay your taxes or if you miss a payment you could end up with unwanted fines or penalties, so understanding your obligations is critical.

In order to calculate payroll taxes, you need to figure out three things:

Who are my taxable workers?
What are their taxable wages?
How much do I need to withhold?

Taxable workers can be employees or independent contractors, the difference being that employees are subject to payroll taxes. Since sometimes the lines between employees and contractors can be a bit blurry, the IRS has behavioral, financial, and relationship tests to determine who’s who.

The IRS considers a taxable worker to be someone whose work an employer has the right to direct and control, not just the results of that work. A taxable worker doesn’t have control over the supplies used for the work being done, and is tied to one company, unlike an independent contractor who can advertise and work for several companies at the same time. In terms of the relationship, if there’s no timeline for employment, like the completion of a project, then the person is a taxable worker.

Taxable wages are payments for services and could include bonuses or gifts, as well as salaried wages. Generally speaking, reimbursed expenses for travel or meals do not fall into this bucket, but need to be verified by saved receipts that are reflected on expense reports.

Now that you know how many taxable employees you have and which wages are taxable, you now have to figure out how much to withhold for federal, state, and local taxes, as well as FICA and FUTA.

By law you must withhold federal income taxes from each paycheck issued for the applicable period. To calculate the amounts, use the wage bracket and percentage tables provided by the IRS. Remember you don’t need to withhold state taxes if there is no state tax on income, like in Alaska and Florida.

The Federal Insurance Contributions Act (FICA) requires employers to withhold Social Security and Medicare taxes from wages paid to employees. In this case, the employer and employee each pay half of the tax. Unemployment taxes, or FUTA, are paid only by the employer.

Calculating payroll taxes can be complex, so give yourself plenty of time to understand the particulars of your obligation, make deadlines, and ensure you have the resources you need at hand.

If you need legal help, don’t hesitate to contact me at the Law Office of E.C. Lewis, P.C., home of your Denver Small Business Attorney. Phone: 720-258-6647. Email: elizabeth.lewis@eclewis.com.

Contact Us Today

Law Office of E.C. Lewis, P.C.
Your Denver Business Attorney

LICENSED IN COLORADO AND NORTH CAROLINA

Mailing Address:

501 S. Cherry Street, Suite 1100
Denver, CO 80246
720-258-6647
Elizabeth.Lewis@eclewis.com

Online at: