Bangalore: Overwhelmed by quick success, entrepreneurs tend to neglect many aspects of business that can give them a tough time in the longer run. Legal mistakes for that matter can bring upon some really harsh adversities and are capable of having painful endings. An entrepreneur must always be careful about all the financial and legal aspects of the company and must be aware of the critical dos and don’ts of business from the point of view of the judiciary. Entrepreneur.com has compiled a list of Legal issues that are generally overlooked by inexperienced entrepreneurs and end up causing disasters.

Let us take a look at what entrepreneurs generally miss out to put their companies into legal issues.

Mistake No. 1: Making informal Handshake deals with clients

Entrepreneurs usually neglect having written documents and bond papers for every business deal that their company enters and the whole situation can turn around badly on them. Not having hard copies or written documents can create complex misunderstandings between the parties. “When things go wrong, the entrepreneur and the client or vendor may have different ideas about what is supposed to happen," says Rachel Rodgers, principal attorney at Rachel Rodgers Law Office.

How to avoid it: It is highly recommended to have manuscripts and written transcripts of every meeting that concerns the company and can create potential legal issues.