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Business & Employment Law

Entrepreneurs Make the World a Spicier Place

Liking Fire In the Mouth Means You Have Fire In the Belly

minimize business liabilityIt has been a spicy week for me. I decided this year to roast Hatch chiles. After roasting, I blended them with some sautéed sweet onions, garlic, fresh cilantro and some cream (fat free so I could eat without guilt!) for a beautiful light green sauce with just the right amount of spicy kick. We’ve been topping it on everything from breakfast tacos to pasta.

I also was delighted to receive a gift of Fernandez’s Chile Molido Puro and Salsa Brava from Gerry Rubendall of Gonzo Strategies, LLC. I thought it was pretty fitting since Gerry is also the one who “spices up” my newsletters each week.

My mouth is watering at all the great ideas I have for these spices: chili, enchiladas, and the like! It almost makes me crave the cold months (almost) that are coming so I can make all of this to warm me up.

For me, chile spice is like a mini-adventure for my mouth, taking my taste buds into brave territory each time I eat. In fact, research suggests the more adventurous you are, the more you like spicy food.

A doctorial candidate at Penn State University, Nadia Byrnes, presented her research findings at the 2013 Institute of Food Technologists (IFT) Annual Meeting & Food Expo®. She assessed the group using the Arnett Inventory of Sensation Seeking (AISS), a test for the personality trait of sensation-seeking, defined as desiring novel and intense stimulation and presumed to contribute to risk preferences. Those in the group who score above the mean AISS score are considered more open to risks and new experiences, while those scoring below the mean are considered less open to those things.

minimize business riskThe subjects were given 25 micrometers of capsaicin, the active component of chili peppers, and asked to rate how much they liked a spicy meal as the burn from the capsaicin increased in intensity. Those in the group who fell below the mean AISS rapidly disliked the meal as the burn increased. People who were above the mean AISS had a consistently high liking of the meal even as the burn increased. Those in the mean group liked the meal less as the burn increased, but not nearly as rapidly as those below the mean.

“Theoretically, we know that burn intensity and liking are linear related. The more irritating a compound or food gets, the less people should like it,” she said. “But that’s not always the case.”

So chances are, if you are an adventurous entrepreneur, you enjoy your spicy chiles, hot salsas, and spicing up your food and your life.

Adventure Isn’t the Same as Danger

All that being said, remember, being “novel and intense” is NOT the same as taking risky chances. As an entrepreneur starting a business you embark on an amazing (and often intense) adventure, but that doesn’t mean you should put everything you have at in danger by risking unnecessary liability.

When you start your business as a sole proprietor, you are essentially your business. You hold all the assets and all the liabilities. It can be a thrilling idea, but a legal claim or a judgment puts all of your personal assets at risk.

When you create a corporation or limited liability company, that company holds your business. A corporation or LLC is actually considered a separate “person” in the law. Thus, your company holds all of the assets and all of the liabilities. You as a human being are now a separate person from your company (and your business). So, when a person has a claim or a judgment against your business, you are no longer personally liable.

Avoiding personal liability is one of the factors to consider when you are deciding to be a sole proprietor or create a business entity. In Texas, we can select from partnerships, corporations, limited liability companies (LLCs), and series LLCs. Decreasing your liability risk and increasing our chances of success are important when starting or maintaining your own business.

Avoid Business “Heartburn”

Another way to make sure your business “spices up your life” instead of giving you heartburn is to be informed and educated. For several years I’ve been teaching new (and existing) entrepreneurs about selecting the best legal structure for their businesses through a program called New Quest. This 10-week course is put on by Knowledge For Success and is taught by business owners for business owners. The 31st session of New Quest is set to start this month. Join us, and in addition to new business traininghearing me talk about “Hot Dogs, BBQ, and Other Cheesy Examples to Explain Business Entities”, you’ll also learn about:

  • Business Loans, Business Credit, and Financing
  • Intellectual Property, Trademarks, and Copyrights
  • Accounting, Tax Deductions, and Sales Tax
  • Market Research, Websites, and Search Engines
  • Branding, Marketing, and Creating Website Content
  • Cash Flow and Financial Projections
  • Networking and Social Media
  • And More

So if you, or someone you know, is starting a business (or needs to go back to the drawing board) New Quest could be just the spice you need.