M&A
7 Reasons Why You Need to Engage an M&A Lawyer when buying an online business
The digital economy has made it easier than ever to buy or sell an online business. And the dream of owning a business that you can take care of from anywhere in the world, when it suits you, is shared by many, in particular if financial freedom is also in the cards. But behind the sleek websites, scalable SaaS models, and promising user metrics lie complex legal and financial risks. Whether you’re selling a D2C e-commerce brand or acquiring a fast-growing platform, engaging a mergers and acquisitions (M&A) lawyer isn’t just smart—it’s essential in my opinion.
For a great youtube channel on the topic check out How to Buy and Online Business with Jaryd Krause.
Here are seven reasons why you need expert legal counsel to protect your interests:
1. Structuring the Deal Correctly
One of the first—and most critical—decisions in any transaction is how to structure it: share deal or asset deal? Both come with with pros and cons depeding on the deal at hand. Your M&A lawyer will help assess tax implications, liability exposure, and operational implications so you don’t inherit unwanted obligations or miss out on strategic advantages.
2. Due Diligence That Catches Hidden Risks
Buyer beware is a fundamental legal principle meaning that you are buying a business at your own risk. Buyers therefore need to verify what they’re buying, and sellers need to ensure their business is in order so that they do not e.g. accept warranties and specific indemnities that they later turn out to be in breach of (needing to pay damages or see a price deduction). A lawyer will coordinate due diligence to uncover hidden liabilities—like software licenses, data protection violations, IP ownership gaps, or employee misclassification—that could kill your investment - and our dream of becoming a successful business owner - or delay (and increase the costs of) closing.
3. Negotiating and Drafting Key Terms
Term sheets, purchase agreements, earn-outs, non-competes, escrow provisions—these aren’t boilerplate. M&A lawyers help ensure that the language reflects the business reality and protects you from vague or unfair terms that could cost you dearly later.
4. Data Protection & GDPR Compliance
Online businesses routinely process user data, often across borders. Failing to vet data handling practices, transfer mechanisms, or required consents under laws like the GDPR could result in heavy regulatory fines. A seasoned lawyer will help you identify gaps and mitigate compliance risk from day one.
5. Handling Employee and Contractor Issues
Whether it’s retaining key talent, transitioning employment contracts, or ensuring correct classification of freelancers, your lawyer will make sure you don’t inherit avoidable legal risk from labor law violations or non-compete disputes.
6. Protecting Intellectual Property (IP)
In most online businesses, the true value lies in intangible assets like code, trademarks, and customer data. An M&A lawyer verifies IP ownership, secures assignments, and ensures enforceable warranties—so you actually acquire what you paid for.
7. Ensuring a Clean Closing (and Beyond)
From regulatory filings and escrow setup to post-closing covenants and dispute resolution mechanisms, your lawyer ensures that the transaction doesn’t unravel after the deal is signed. Not least will a non-compete on the seller be central for the buyers protection, and missing to include a comprehensive non-compete (non-solicitation) could prove costly. Lawyers also help with integration planning and transition support where needed.
Final Thoughts
Buying or selling an online business without a legal expert is like launching a product without QA testing. An M&A lawyer doesn’t just reduce risk—they add strategic clarity, prevent value erosion, and drive smoother negotiations. In a market where speed and trust matter, having the right legal partner can make or break the deal. In my opinion. If you have questions or need an M&A lawyer hands on please don´t hesitate to contact me on kat@stgcommerciallaw.com Stockholm, 2025-07-24 Author: Kat Strandberg
For a great youtube channel on the topic check out How to Buy and Online Business with Jaryd Krause.
Here are seven reasons why you need expert legal counsel to protect your interests:
1. Structuring the Deal Correctly
One of the first—and most critical—decisions in any transaction is how to structure it: share deal or asset deal? Both come with with pros and cons depeding on the deal at hand. Your M&A lawyer will help assess tax implications, liability exposure, and operational implications so you don’t inherit unwanted obligations or miss out on strategic advantages.
2. Due Diligence That Catches Hidden Risks
Buyer beware is a fundamental legal principle meaning that you are buying a business at your own risk. Buyers therefore need to verify what they’re buying, and sellers need to ensure their business is in order so that they do not e.g. accept warranties and specific indemnities that they later turn out to be in breach of (needing to pay damages or see a price deduction). A lawyer will coordinate due diligence to uncover hidden liabilities—like software licenses, data protection violations, IP ownership gaps, or employee misclassification—that could kill your investment - and our dream of becoming a successful business owner - or delay (and increase the costs of) closing.
3. Negotiating and Drafting Key Terms
Term sheets, purchase agreements, earn-outs, non-competes, escrow provisions—these aren’t boilerplate. M&A lawyers help ensure that the language reflects the business reality and protects you from vague or unfair terms that could cost you dearly later.
4. Data Protection & GDPR Compliance
Online businesses routinely process user data, often across borders. Failing to vet data handling practices, transfer mechanisms, or required consents under laws like the GDPR could result in heavy regulatory fines. A seasoned lawyer will help you identify gaps and mitigate compliance risk from day one.
5. Handling Employee and Contractor Issues
Whether it’s retaining key talent, transitioning employment contracts, or ensuring correct classification of freelancers, your lawyer will make sure you don’t inherit avoidable legal risk from labor law violations or non-compete disputes.
6. Protecting Intellectual Property (IP)
In most online businesses, the true value lies in intangible assets like code, trademarks, and customer data. An M&A lawyer verifies IP ownership, secures assignments, and ensures enforceable warranties—so you actually acquire what you paid for.
7. Ensuring a Clean Closing (and Beyond)
From regulatory filings and escrow setup to post-closing covenants and dispute resolution mechanisms, your lawyer ensures that the transaction doesn’t unravel after the deal is signed. Not least will a non-compete on the seller be central for the buyers protection, and missing to include a comprehensive non-compete (non-solicitation) could prove costly. Lawyers also help with integration planning and transition support where needed.
Final Thoughts
Buying or selling an online business without a legal expert is like launching a product without QA testing. An M&A lawyer doesn’t just reduce risk—they add strategic clarity, prevent value erosion, and drive smoother negotiations. In a market where speed and trust matter, having the right legal partner can make or break the deal. In my opinion. If you have questions or need an M&A lawyer hands on please don´t hesitate to contact me on kat@stgcommerciallaw.com Stockholm, 2025-07-24 Author: Kat Strandberg