Choosing Your Business Name

So, what is in a name – a business name, that is?

Well, frankly, a lot! Your business’s name is potentially one of its most valuable assets. There are both legal and marketing considerations related to the name you choose for your online business.

We’ll be focusing primarily on the legal aspects of business name selection here, so let’s get started.

Why Choosing a Business Name Is So Important

Let me count the ways (I’ve got this whole “Shakespeare” thing going on 😉 ):

You are starting a business online with plans to succeed, right? As your business grows, do you really want it to be known as “Steve Smith” or “Sally Jones?”

OK, maybe using his own name worked for Donald Trump, but for most of us it’s probably not the most professional-sounding choice.

Suppose based upon the foregoing suggestion you decide not to go with your own name and you just pick a name out of the air, let’s say “Acme Enterprises.” Great! You have your name.

So, you go about setting up your business with it’s newly selected name and you start operating.

Sure enough, just as planned, you are succeeding beyond your expectations and “Acme Enterprises” is building name recognition and goodwill with your many customers and business contacts.

What could go wrong?

How about this? One day you go to the mailbox and there’s a letter from one of my fellow lawyers informing you that your name, “Acme Enterprises” is really a client’s registered name.

Can you say, “cease and desist?”

Being the nice guys and gals that we lawyers are, the lawyer agrees not to claim damages against you IF you stop using the name and delete all references to it from your websites, emails, advertisements, business cards, letterheads – everything.

Oh, and you need to get that done in the next 15 minutes!

Now you must do all that work (free) and notify all of your clients and business associates that you will no longer be known as “Acme Enterprises.”

So now you’re thinking to yourself, “Dang, I wish I had planned a little better!”

I won’t undertake a discussion of the technicalities of trademarks, trade names, and service marks here.

What you need to know if you live in and operate your business from the United States is that most states have a system by which you can check the availability of a business name for use (at least in that state).

If you find a name you like and it’s available for use, these states also will have a method by which you can register it for your own use.

The state registrations will usually protect you within your state, assuming your name doesn’t infringe on a federally registered name of some kind.

In many states this function is controlled by the office of the state’s Secretary of State.

You can probably go to your state’s website and look for the Secretary of State or business records and learn a lot about what your particular state requires.

Don’t leave just yet though. I suggest you finish reading this very informative article 😉 .

Guidelines for Choosing Your Name

To be safe when choosing your business name, conjure up a unique name that it is unlikely anyone else has thought of yet.

Don’t even think about getting cute with some thinly veiled variation of a well known brand, product or company. You haven’t forgotten the “cease and desist” part of this discussion already, have you?

Types of State Name Registration

Generally, the states provide two methods of registering your business name, depending on how you will be doing business.

If you are forming a corporation, limited liability company (LLC), limited liability partnership (LLP), or some other form of limited liability entity (recommended), the name becomes the name of the entity and when you form the entity using the process your state provides, the name belongs to the new entity.

Done deal, at least as far as your state is concerned, assuming you will operate your business under that name.

If, on the other hand, you will not be forming any type of limited liability entity, the states usually provide a mechanism to register and operate under an “assumed name,” also called a “fictitious name.”

In some states, this is accomplished through the state’s Secretary of State, but probably in most states this is a registration filed with the local County Clerk’s Office where you are doing business.

I know using an “assumed” or “fictitious” name sounds sinister, but it’s perfectly legit. It simply means you are operating under a name other than your given name.

Basically, you become an individual doing business under an assumed (business) name. So, if you were thinking of choosing the name “Acme Enterprises,” you would file an assumed name certificate showing “Steve Smith, d/b/a Acme Enterprises.” [For those who don’t know, “d/b/a” stands for “doing business as.”]

Federal Name Registration

As mentioned, there are processes by which you can register your business name and/or products with the federal government. This is accomplished through the United States Patent and Trademark Office.

That process will be reserved for a discussion in another article, but for now just be aware that there are ways to protect your name beyond just your own state, all the way up to the national and international levels.