Common Legal Mistakes Founders Make (and How to Avoid Them)

When was the last time you checked whether your business is actually protected — not just registered?

If you’re like most founders, you filed your LLC, got your logo, opened your Instagram page… and called it a day.

But here’s the truth: legal protection isn’t a one-time event. It’s an ongoing system.

And small mistakes — the kind that seem harmless early on — are often what cost founders the most money later.

Below are three of the most common legal mistakes new business owners make (and how you can fix them this week).

1. Mixing Personal and Business Money

It sounds small, but it’s huge.

When you use one bank account for everything, your personal and business finances become one — and that can destroy your legal protection.

Start today:

• Open a separate business bank account.
• Run all income and expenses through it.
• If you’re not ready for a big bank, use a free option like Bluevine or Relay.

This is the #1 way to make your business look credible — to funders, clients, and the IRS.

2. Using Google Contracts

That free template you found online? Probably missing the exact clause that could save you later.

Every contract needs three basics:

1. Scope of Work — What’s included and what’s not.
2. Payment Terms — When money is due and what happens if it’s late.
3. Termination Clause — How either party can walk away.

These details don’t just “sound professional” — they protect you from refund requests, ghosting, or messy disputes.

3. Forgetting to Protect Your Name

Imagine spending a year building a brand — only to learn someone else filed your name federally before you.

Before you launch, check USPTO.gov to make sure your name and logo are available.

It’s free, takes two minutes, and can save you thousands in rebranding costs later.

Before You Go

If you’ve ever thought “I’ll handle the legal stuff later,” this is your sign that later needs to be now.

These small actions — a contract, a bank account, a trademark search — are what turn a business into a company.

The full INSIDER version includes:

• 4 more common mistakes founders make
• Step-by-step fixes
• Links to the exact legal tools we use

👉 Read the full version inside OVIDIA. INSIDER.

Because real protection isn’t about panic — it’s about preparation.