Report Index

LEGAL ASPECTS OF ENTREPRENEURSHIP

Cindy Schipani
Professor Merwin H. Waterman Collegiate Professor of
Business Administration; Professor of Business Law

Law is much too important to leave to the lawyers, Business Law Professor Cindy Schipani often tells graduate students in her Legal Aspects of Entrepreneurship course. “As an entrepreneur, you need to understand enough law to know when to go to lawyers with questions and be able to comprehend what they tell you, so you can make your own business decisions,”she explains. “It's better to think about legal issues before they become legal problems, because it's a lot cheaper to do things right in the first place than to fix them later on.”Schipani, who practiced commercial and corporate law in Chicago and Detroit before taking up teaching, uses broad brushstrokes to help students understand their legal rights and obligations from the earliest stages of ideation and new-venture creation through the later stages of venture-capital investment and exits. “Often when people have great ideas or inventions, they aren't thinking about how to protect themselves legally, or whether they even have the legal right to start a new venture related to something they developed at their current company,”she says. “Non-compete clauses and restrictions on intellectual property imposed by an employer can create a legal quagmire for an entrepreneur and sink a start-up.”During her course, Schipani covers a full spectrum of legal issues, including business formation, intellectual property, product liability, employment and contracts, which must be addressed properly, and in a timely manner, to keep an entrepreneurial venture on an even keel. Inexperienced start-ups dealing with well-established, deep-pocketed corporations are especially at risk unless they have protected their legal rights and are willing to defend them. Schipani also invites practicing attorneys with expertise in venture-capital investment, global expansion and other areas to share their experiences inside and outside the classroom. “While the legal system can be somewhat daunting,”she says, “it also can provide a competitive advantage to an entrepreneur who uses law to set up a business properly and profit from it.”