| Hey, Well my personal circumstances are by the by: they were an example :D
My point was really more that you should try to talk to people with experience (face to face, not just here). A half hr to an hr conversation will probably get quite a lot of stuff straight. Considering your situation it's a bit hard to give advice. Do you actually have a product to bring to market? Are you at a stage where you a) need funding or b) can begin to sell. With my startup I worked with a team of friends for about 2 years before we formed the actual company. We all had day jobs or university and so we worked in our downtime bringing our idea into fruition. Now we have an almost marketable product and are at the stage where funding is essential: so recently we took the step of forming the company and searching for funding.Until now it was an unecessary need. If your not selling or bringing in cash for funds then I would advise avoiding forming any legal entity. The only thing I would say is that it might be worth signing some kind of partnership agreement between you and your friend. I'm sure things will be fine but if you fall out (it's so easy) it is best to know exactly where you stand in terms of what individually you can take away (ideas, code, etc.). As to the final part of that post - regarding getting out if the startup fails. That is incredibly country specific. You will need to get some advice: either from a lawyer or from a public body (if they exist) as to your exact options. In the UK you could, for example form a Limited Liability Partnership (where if things folded you only have a small personal liability) or an full on LTD company (where there is no personal liability). I assume similar entities can be formed in China (though I DONT KNOW). I think the best advice is to hunt for someone locally who can tell you your options in that case. If your entering into contracts with other companies at this stage (note not just selling - actual contracted agreements) then you DEFINITELY need to consult professionally. It shouldn't be too expensive and is worth it. If your obtaining funding and are presented a contract ALWAYS ALWAYS ALWAYS take it to a lawyer before signing. :) Good luck! |
If iti s only a small company you might be ok just keeping a general book (income, outlay, expenditure etc etc.) and keep all receipts. Then at the end of the financial year take all that to an accountant and pay him to get it all written up and submitted. That is how it works in the UK (and probably costs around £400-500 depending on the amount of work involved) - I dont know if that is the case in China but it is worth investigating. Usually there is no formal requirement for a small startup to keep regulated books - just to have some form of accounts the tax man can request at any time (it;s more complex than that but, meh, essentially all that ya need to know :P)