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The legal checklist for your first $100k in revenue
Nationwide brand protection for ambitious founders, direct-to-consumer innovators, and growing enterprises. Led directly by attorney Nuzayra Haque-Shah.
Before you hit $100K in revenue, you need five things in place: a business entity (usually an LLC) with its own bank account, a signed client agreement for every sale, a trademark clearance search and filing for your business name, website terms and a privacy policy, and a written agreement with every contractor that assigns their work to you. Most founders have one or two. The gaps get expensive fast.
Why this Matters
The first $100K is when legal gaps stop being theoretical. You have real clients, real money moving, and a name people are starting to recognize. That’s exactly what makes you worth copying, suing, or disputing.
Picture this. You’re a coach at $80K. A client who paid $5,000 files a chargeback 60 days in. Your only “contract” is an Instagram DM and a Stripe receipt.
The same month, a company with a registered trademark sends you a cease and desist over your program name. Neither problem is fatal alone. Together, with nothing on paper, they cost you months and money you’d rather spend growing.
None of this requires a big legal budget. It requires doing five things in the right order. We call it the Five-Layer Foundation: entity, agreements, brand, website, and team.
When should I form an LLC?
Before you take your first real payment, or as soon as you realize you’ve already started. A limited liability company (LLC) is a business structure that keeps business debts and lawsuits separate from your personal assets, like your home and savings. Without one, you’re a sole proprietor, and the business’s problems are legally your problems.
An LLC only protects you if you treat it as separate. That means its own bank account, its own EIN (a free federal tax ID from the IRS), and no paying your personal bills from business funds. Mixing money is the fastest way to give a court a reason to ignore the LLC and reach your personal assets. Lawyers call that “piercing the corporate veil.”
Even a single-member LLC should have a written operating agreement, the internal rulebook for how the company runs. State filing fees and annual fees vary widely, so check your state’s rules before you file. Ask your CPA whether an S-corp election makes sense as profit grows.
What contracts do I need before my first client pays me?
A signed client agreement for every paid engagement. Not a DM, not an invoice, not a proposal with a “Pay Now” button. A contract is what you point to when a client asks for a refund, disputes a charge, or claims you promised something you didn’t.
At minimum, your client agreement should cover:
- Scope: exactly what’s included, and what isn’t
- Payment terms: amounts, due dates, late fees, and what happens with payment plans
- Refunds and cancellations: in plain language the client initials
- Intellectual property: whether the client gets ownership of deliverables or a license to use them
- Limitation of liability: a cap on what you can owe if something goes wrong
- Termination: how either side can end it, and what’s owed if they do
A clear, signed refund policy is also your best evidence in a chargeback dispute. Payment processors want to see what the customer agreed to before they paid.
When should I trademark my business name?
Before you spend serious money marketing it. A trademark protects the name, logo, or slogan customers use to identify you. Using a name gives you some rights, but only in the places you actually do business. A federal registration from the U.S. Patent and Trademark Office (USPTO) gives you nationwide rights and a much stronger position if someone copies you.
Start with a clearance search, before you file and ideally before you launch. It checks whether someone already has rights in a similar name for similar services. A search now costs far less than a rebrand after you’ve printed, posted, and built a following.
When you file, you choose classes, the categories of goods and services the mark covers. Service businesses commonly file in Class 41 (education, coaching, workshops), Class 35 (business consulting), and Class 9 (downloadable digital products). The USPTO charges a government fee for each class, and registration often takes a year or more, so file early. For the basics, read What Is a Trademark: Your Questions Answered.
What legal pages does my website need?
At least a privacy policy and terms of use. If your site collects names or emails, which every opt-in page does, you need a privacy policy explaining what you collect and how you use it. California’s Online Privacy Protection Act requires one for commercial websites that collect personal information from California residents, which in practice means almost everyone.
Terms of use set the rules for your site and your digital products: who owns the content, what buyers can and can’t do with it, and how disputes get handled. If you sell courses or downloads, your terms should say plainly that a purchase is a license to use, not permission to share or resell.
If you use testimonials, affiliate links, or results claims, the Federal Trade Commission’s Endorsement Guides apply. Disclose paid relationships clearly, and don’t present an unusual result as typical.
What paperwork do I need before hiring a contractor?
A written contractor agreement, signed before any work starts. It should cover scope, payment, confidentiality, and, most importantly, ownership. Under U.S. copyright law, whoever creates the work owns it unless a signed agreement transfers it to you, including your designer’s graphics, your editor’s videos, and your copywriter’s sales page. We break this down in Do You Own Your Course Content If Someone Else Built It?
Be careful with how you treat contractors. If you set their hours, control how they work, and treat them like staff, they may legally be employees, with tax and wage consequences. Your CPA or an employment attorney can help you classify each role correctly.
What to do next
- Form your entity and separate your money. File the LLC, get an EIN, open a business bank account, and sign an operating agreement.
- Put every client on a signed contract. Update your template to cover scope, payment, refunds, IP, liability caps, and termination. Use it for every sale, including the ones that feel informal.
- Clear and file your trademark. Run a clearance search on your business name and your signature program name, then file in the classes that match what you actually sell.
- Publish your website policies. Add a privacy policy, terms of use, and any required affiliate or testimonial disclosures.
- Paper your team. Get a signed contractor agreement with an IP assignment from everyone who creates anything for your business. For anyone already working with you, get one signed now.
- Calendar a legal check-in at $250K. New revenue brings new risks: investors, hires, licensing deals, bigger contracts. Review the foundation again before you scale past it.
Frequently Asked Questions
Do I need an LLC if I’m a solo service provider?
You don’t have to have one, but it’s usually worth it once you’re taking real money. An LLC separates business liabilities from your personal assets, as long as you keep finances separate. Without one, a business lawsuit can reach your personal savings.
Can I use a contract template I found online?
You can start with one, but templates rarely fit your offer, your refund policy, or your IP. The clauses most likely to matter, like refunds, liability caps, and ownership, are the ones generic templates get wrong. Have an attorney review your template once, then reuse it.
Is it too late to trademark my name if I’ve been using it for years?
Usually not, but act now. Your use gives you some rights, but only where you’ve actually done business, and someone else may register a similar name first. Start with a clearance search to see where you stand.
What’s the difference between a trademark and an LLC name?
Registering an LLC reserves the name only as a business entity name in your state. It doesn’t give you trademark rights or stop someone from using the name in commerce. Only a trademark, ideally a federal registration, protects the brand itself.
Do I need a privacy policy if I only collect emails?
Yes. An email address is personal information. If your opt-in form collects it, you need a privacy policy that explains how you use it, and California law requires one if you collect it from California residents.