I wrote an app, now should i form a business?

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Hayden
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I wrote an app, now should i form a business?

Post by Hayden » Wed May 20, 2020 11:39 am

One of my bucket list items was to write an app and publish it on the app store. Since i've been stuck in my home for months, i've used that time to learn to code and write an app. My app is now "done" -- meaning I now have something that I want to show to people. I went to the Google Play Store to publish it. I learned that this is more involved than i thought.

First question: should i post as an individual or as a business? A friend advised me to form an LLC to provide liability protection. Should I form an LLC and use the LLC name in publishing the app? or post it under my own name?

Second question: is there some standard disclaimer language i should use? Something along the lines of, this app is available for testing purposes only and there are no warranties whatsoever. Can someone advise on this?

I'm sure there are other things i haven't thought of. Any other advice?

sixtyforty
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Re: I wrote an app, now should i form a business?

Post by sixtyforty » Thu May 21, 2020 9:10 am

I wrote an app and published it on the Apple App Store a few years ago. I did form an LLC (with a company name, not my own name) and had a link inside the app that had all the necessary disclaimers. I used templates for the legalese but did tailor it to better match the app. The other thing you can consider is a simple website that highlights the app and your company and provides a link your app in the app store.
"Simplicity is the ultimate sophistication" - Leonardo Da Vinci

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Hayden
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Re: I wrote an app, now should i form a business?

Post by Hayden » Thu May 21, 2020 9:15 am

sixtyforty wrote:
Thu May 21, 2020 9:10 am
I wrote an app and published it on the Apple App Store a few years ago. I did form an LLC (with a company name, not my own name) and had a link inside the app that had all the necessary disclaimers. I used templates for the legalese but did tailor it to better match the app. The other thing you can consider is a simple website that highlights the app and your company and provides a link your app in the app store.
Thanks. Where did you get the templates for the legalese?

JD2775
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Re: I wrote an app, now should i form a business?

Post by JD2775 » Thu May 21, 2020 9:22 am

You learned to code and developed an app in 2 months? Kudos :sharebeer

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Hayden
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Re: I wrote an app, now should i form a business?

Post by Hayden » Thu May 21, 2020 9:42 am

JD2775 wrote:
Thu May 21, 2020 9:22 am
You learned to code and developed an app in 2 months? Kudos :sharebeer
Thanks. I used Flutter and took courses on Udemy. Flutter made it easy.

That said, there's lots that I don't know. So I'm looking for some legalese i can add along the lines of...this app is available for testing purposes and I make no warranties whatsoever.

TallBoy29er
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Re: I wrote an app, now should i form a business?

Post by TallBoy29er » Thu May 21, 2020 11:54 am

Congrats on the app.

I would likely form an LLC. But it is not required.

Why don't you look at the legal terms of other similar apps. They are easy to find, often listed under "Terms of Use". You could easily scrape a lot of content from 1 or 2 like apps. I would also say something to the order of the app being for entertainment purposes only, as opposed to the end user testing it. That's not legal advice, just a thought.

Edited to add: If you are going to be collecting any data from users, that may put you in a different risk category, and additional terms you would need to add to a Terms of Use.

knightrider
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Re: I wrote an app, now should i form a business?

Post by knightrider » Thu May 21, 2020 12:02 pm

No need for a LLC. Operate as a sole proprietor. As others said, pay close attention to anything "risky" your app may be doing such as storing sensitive personal information.

Here's some legalese you can use:

The software is provided in the
hope that it will be useful, but WITHOUT ANY WARRANTY; without even the
implied warranty of MERCHANTABILITY or FITNESS FOR A PARTICULAR
PURPOSE.

Limitation of Liability
=======================

You expressly understand and agree that my_business shall not
be liable for any direct, indirect, incidental, special, consequential
or exemplary damages, including but not limited to, damages for loss of
profits, goodwill, use, data or other intangible losses (even if
my_business has been advised of the possibility of such
damages), resulting from: (i) the use or the inability to use the
service; (ii) the cost of procurement of substitute goods and services
resulting from any goods, data, information or services purchased or
obtained or messages received or transactions entered into through or
from the service; (iii) unauthorized access to or alteration of your
transmissions or data; (iv) statements or conduct of any third party on
the service; or (v) any other matter relating to the service.

You expressly understand and agree that my_business shall not
be liable for any direct, indirect, incidental, special, consequential
or exemplary damages, including but not limited to errors in automatic
credit card debits performed by my 3rd party billing services, PayPal.

The information and materials contained on this web site have been
compiled from a variety of sources and, as such, are subject to change
without notice. In no event will my_business be liable for any
damages, whether direct, indirect, general, consequential, incidental,
exemplary or special, arising from the use of information provided on
this server or through links to any other servers.

Communications to my_business via this web site shall in no way
be deemed to constitute legal or official notice to
my_business , its agencies, officers, employees, representatives
or agents with respect to any existing, pending or future claim or
cause of action against my_business or any of its agencies,
officers, employees, representatives or agents where notice is required
by Federal, State or local law. Nor shall communications to
my_business via this web site be deemed to constitute legal or
official notice for any other purpose. For communication of this type
notice should be directed to the following mailing address:

kabob
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Location: Loudon, Tn

Re: I wrote an app, now should i form a business?

Post by kabob » Thu May 21, 2020 12:05 pm

Throw a Beta out on here... We''ll test it, evaluate and advise once we know what it is (does & how well)...

Theseus
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Re: I wrote an app, now should i form a business?

Post by Theseus » Thu May 21, 2020 12:12 pm

Hayden wrote:
Wed May 20, 2020 11:39 am
One of my bucket list items was to write an app and publish it on the app store. Since i've been stuck in my home for months, i've used that time to learn to code and write an app. My app is now "done" -- meaning I now have something that I want to show to people. I went to the Google Play Store to publish it. I learned that this is more involved than i thought.

First question: should i post as an individual or as a business? A friend advised me to form an LLC to provide liability protection. Should I form an LLC and use the LLC name in publishing the app? or post it under my own name?

Second question: is there some standard disclaimer language i should use? Something along the lines of, this app is available for testing purposes only and there are no warranties whatsoever. Can someone advise on this?

I'm sure there are other things i haven't thought of. Any other advice?
Get a score mentor that can help with all these questions and may help you monetize it as well. It's free. And if assigned mentor doesn't meet your expectations ask to be reassigned until you find the one that meets your need.

www.score.org

sixtyforty
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Re: I wrote an app, now should i form a business?

Post by sixtyforty » Fri May 22, 2020 6:21 am

Hayden wrote:
Thu May 21, 2020 9:15 am
sixtyforty wrote:
Thu May 21, 2020 9:10 am
I wrote an app and published it on the Apple App Store a few years ago. I did form an LLC (with a company name, not my own name) and had a link inside the app that had all the necessary disclaimers. I used templates for the legalese but did tailor it to better match the app. The other thing you can consider is a simple website that highlights the app and your company and provides a link your app in the app store.
Thanks. Where did you get the templates for the legalese?
I just searched the internet and also looked at very popular apps, similar to mine (like Instagram) and used elements of what they had. I figured that popular apps have the funds to hire the top attorney's to develop the privacy, terms and conditions etc.

A couple of other things to think about... It's helpful if you understand how you manage changes (source control), testing and delivery before you actually publish the app. Expect there will be problems. Lastly, if your app is designed to have multiple people using it with access to a backend (like SQL etc), do some load testing so you can identify any potential resource/lockup issues etc.
"Simplicity is the ultimate sophistication" - Leonardo Da Vinci

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Hayden
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Re: I wrote an app, now should i form a business?

Post by Hayden » Fri May 22, 2020 3:18 pm

knightrider wrote:
Thu May 21, 2020 12:02 pm
No need for a LLC. Operate as a sole proprietor. As others said, pay close attention to anything "risky" your app may be doing such as storing sensitive personal information.

Here's some legalese you can use:

The software is provided in the
hope that it will be useful, but WITHOUT ANY WARRANTY; without even the
implied warranty of MERCHANTABILITY or FITNESS FOR A PARTICULAR
PURPOSE.

Limitation of Liability
=======================

You expressly understand and agree that my_business shall not
be liable for any direct, indirect, incidental, special, consequential
or exemplary damages, including but not limited to, damages for loss of
profits, goodwill, use, data or other intangible losses (even if
my_business has been advised of the possibility of such
damages), resulting from: (i) the use or the inability to use the
service; (ii) the cost of procurement of substitute goods and services
resulting from any goods, data, information or services purchased or
obtained or messages received or transactions entered into through or
from the service; (iii) unauthorized access to or alteration of your
transmissions or data; (iv) statements or conduct of any third party on
the service; or (v) any other matter relating to the service.

You expressly understand and agree that my_business shall not
be liable for any direct, indirect, incidental, special, consequential
or exemplary damages, including but not limited to errors in automatic
credit card debits performed by my 3rd party billing services, PayPal.

The information and materials contained on this web site have been
compiled from a variety of sources and, as such, are subject to change
without notice. In no event will my_business be liable for any
damages, whether direct, indirect, general, consequential, incidental,
exemplary or special, arising from the use of information provided on
this server or through links to any other servers.

Communications to my_business via this web site shall in no way
be deemed to constitute legal or official notice to
my_business , its agencies, officers, employees, representatives
or agents with respect to any existing, pending or future claim or
cause of action against my_business or any of its agencies,
officers, employees, representatives or agents where notice is required
by Federal, State or local law. Nor shall communications to
my_business via this web site be deemed to constitute legal or
official notice for any other purpose. For communication of this type
notice should be directed to the following mailing address:
Thank you! That's a great help!

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Hayden
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Re: I wrote an app, now should i form a business?

Post by Hayden » Fri May 22, 2020 3:27 pm

TallBoy29er wrote:
Thu May 21, 2020 11:54 am
Congrats on the app.

I would likely form an LLC. But it is not required.

Why don't you look at the legal terms of other similar apps. They are easy to find, often listed under "Terms of Use". You could easily scrape a lot of content from 1 or 2 like apps. I would also say something to the order of the app being for entertainment purposes only, as opposed to the end user testing it. That's not legal advice, just a thought.

Edited to add: If you are going to be collecting any data from users, that may put you in a different risk category, and additional terms you would need to add to a Terms of Use.
I am collecting data from users, that's what has me concerned. I am using Google Cloud Firestore to save user data. Users can (at their choice) upload location data (Google Maps API) and pictures from their camera. The pictures are stored in Google Firebase Storage. Also, they log in with username and password using Google Authentication. And there is a chat feature.

Seems like i need to get the legalese and put it directly into the app, as well as on the Google Play Store.

veindoc
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Re: I wrote an app, now should i form a business?

Post by veindoc » Fri May 22, 2020 6:16 pm

Hayden wrote:
Thu May 21, 2020 9:42 am
JD2775 wrote:
Thu May 21, 2020 9:22 am
You learned to code and developed an app in 2 months? Kudos :sharebeer
Thanks. I used Flutter and took courses on Udemy. Flutter made it easy.

That said, there's lots that I don't know. So I'm looking for some legalese i can add along the lines of...this app is available for testing purposes and I make no warranties whatsoever.
I admire so much some people's resiliency. I spent the first 4 weeks of this pandemic in bed biting my fingernails from anxiety. When I wasn't biting my fingernails, I spent hours on various news outlets scaring myself silly. It is only within the last two weeks that I have been able to make lemons out of lemonade. Kudos indeed!

CFM300
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Re: I wrote an app, now should i form a business?

Post by CFM300 » Fri May 22, 2020 6:28 pm

Hayden wrote:
Fri May 22, 2020 3:27 pm
I am collecting data from users, that's what has me concerned. I am using Google Cloud Firestore to save user data. Users can (at their choice) upload location data (Google Maps API) and pictures from their camera. The pictures are stored in Google Firebase Storage. Also, they log in with username and password using Google Authentication. And there is a chat feature.
I mentioned this in your other thread about a privacy policy, but if you're collecting personally identifiable information, you need to consider whether you are subject to various privacy laws, such as the California Consumer Privacy Act, COPPA, the EU's GDPR, etc.

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Hayden
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Re: I wrote an app, now should i form a business?

Post by Hayden » Sat May 23, 2020 9:14 am

CFM300 wrote:
Fri May 22, 2020 6:28 pm
Hayden wrote:
Fri May 22, 2020 3:27 pm
I am collecting data from users, that's what has me concerned. I am using Google Cloud Firestore to save user data. Users can (at their choice) upload location data (Google Maps API) and pictures from their camera. The pictures are stored in Google Firebase Storage. Also, they log in with username and password using Google Authentication. And there is a chat feature.
I mentioned this in your other thread about a privacy policy, but if you're collecting personally identifiable information, you need to consider whether you are subject to various privacy laws, such as the California Consumer Privacy Act, COPPA, the EU's GDPR, etc.
Yes. Thank you. Those privacy laws are a lot to digest. My plan is:
1. Pick a company name and form LLC
2. Use iubenda to generate the Privacy Policy and Terms of Service.
3. Put a link to the privacy policy and TOS directly into the app.

Spirit Rider
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Re: I wrote an app, now should i form a business?

Post by Spirit Rider » Sat May 23, 2020 9:36 am

As has been pointed out an LLC is not required, it and any disclaimers may not provide the liability protection you think they do. Also, an LLC will likely have additional state annual costs and maybe additional taxes. For example, LLCs in CA are subject to the 1.5% franchise tax (min $800/yr).

However, you should at a minimum use a DBA or fictitious name registered with your state. Neither an LLC or one of these prevents your name from being obtained from the state, but at least someone has to go to that effort and your name just isn't out in the open.

CFM300
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Re: I wrote an app, now should i form a business?

Post by CFM300 » Sat May 23, 2020 11:52 am

Hayden wrote:
Sat May 23, 2020 9:14 am
Those privacy laws are a lot to digest.
I would recommend that you fully understand which laws apply to you and what your obligations are under those laws. In addition, I would recommend that you secure a cyber insurance policy. You can find policies that will cover you for data breaches, client losses resulting from your app, and even unintentional failures to comply with laws and the resulting fines.

Remember: insurance protects you not only from legitimate claims, but also from the expense of defending yourself against illegitimate claims.

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Hayden
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Re: I wrote an app, now should i form a business?

Post by Hayden » Sat May 23, 2020 12:58 pm

Spirit Rider wrote:
Sat May 23, 2020 9:36 am
As has been pointed out an LLC is not required, it and any disclaimers may not provide the liability protection you think they do. Also, an LLC will likely have additional state annual costs and maybe additional taxes. For example, LLCs in CA are subject to the 1.5% franchise tax (min $800/yr).

However, you should at a minimum use a DBA or fictitious name registered with your state. Neither an LLC or one of these prevents your name from being obtained from the state, but at least someone has to go to that effort and your name just isn't out in the open.
Thank you for weighing in. In my state (Arizona) it costs $50 to form an LLC, and there is no annual filing for LLCs.

If i don't want to have the expense of a registered agent, then i will list my name and home address. As you point out, those will be publicly available from the state. But at least I will not have my personal name listed on the Google Play Store.

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Hayden
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Re: I wrote an app, now should i form a business?

Post by Hayden » Sat May 23, 2020 1:03 pm

CFM300 wrote:
Sat May 23, 2020 11:52 am
Hayden wrote:
Sat May 23, 2020 9:14 am
Those privacy laws are a lot to digest.
I would recommend that you fully understand which laws apply to you and what your obligations are under those laws. In addition, I would recommend that you secure a cyber insurance policy. You can find policies that will cover you for data breaches, client losses resulting from your app, and even unintentional failures to comply with laws and the resulting fines.

Remember: insurance protects you not only from legitimate claims, but also from the expense of defending yourself against illegitimate claims.
You've given me alot to think about. Thank you.
A quick google search suggests that cyber insurance is not cheap. Realistically, i will probably not make money from this app.

Are there low cost options for individuals in my situation?

CFM300
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Re: I wrote an app, now should i form a business?

Post by CFM300 » Sat May 23, 2020 1:33 pm

Hayden wrote:
Sat May 23, 2020 1:03 pm
Are there low cost options for individuals in my situation?
I'm not a lawyer, and you should investigate the laws yourself enough to make your own determination as to whether they apply, but based on some things you've said, I don't think that you need to worry about the GDPR or California's laws. (I would be happy to talk through this via PM if you want.)

But since your'e a resident of AZ, you should make sure that you fully understand their laws. A quick Google search reveals, for instance, that they have a data-breach notification law and that willful violations of the law could results in some hefty fines.

As to cost of cyber insurance, I pay around $850/year for a policy with $1 million coverage for pretty much any loss related to hacks, data-breaches, cyber extortion, mandatory assessments/audit-services post-breach, my own mishandlings of personal information, and unintentional violations of the GDPR or similar data law worldwide.

I tried contacting various insurance companies directly, without much luck. So I found a local insurance broker. He was able to secure quotes from two highly-respected and highly-rated companies.

Depending on what your app does, you might also consider Errors and Omissions insurance. I pay around $650/year for $1 million coverage.

Spirit Rider
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Re: I wrote an app, now should i form a business?

Post by Spirit Rider » Sat May 23, 2020 6:03 pm

Hayden wrote:
Sat May 23, 2020 12:58 pm
As you point out, those will be publicly available from the state. But at least I will not have my personal name listed on the Google Play Store.
My point was, that the same would be true if you simply registered under a DBA/Fictitious Business Name

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Hayden
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Re: I wrote an app, now should i form a business?

Post by Hayden » Mon May 25, 2020 2:08 pm

Spirit Rider wrote:
Sat May 23, 2020 6:03 pm
Hayden wrote:
Sat May 23, 2020 12:58 pm
As you point out, those will be publicly available from the state. But at least I will not have my personal name listed on the Google Play Store.
My point was, that the same would be true if you simply registered under a DBA/Fictitious Business Name
In my state, Arizona, there is no annual filling requirement for an LLC. It is a simple process and $50 to set one up.

What is the down side of setting up an LLC vs. registering under a DBA/Fictitious Business Name?

Isn't the tax filing identical? Don't i just report income and expenses on a Schedule C on my personal tax return?

I appreciate your help. I want to understand what i'm getting into before i jump in.

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