Patents are important to startups because they provide a legally sanctioned monopoly that bars entry to competitors. In addition, patents may serve defensive purposes in that competitors may be less likely to sue a startup for patent infringement if there is a risk of a countersuit. Further,…
A couple of months ago, we gave you five privacy tips relevant to startups and told you about the consequences startups face from regulators if they fail to protect their users’ privacy. Regulators like the Federal Trade Commission (FTC), the Federal Communications Commission (FCC), the Consumer Financial…
Collecting stockholder consent by email can be more complicated than collecting director consent by email. If your company is incorporated in a state that permits stockholders to consent by electronic transmission, developing a process for collecting these consents is key to ensuring that the stockholder action is…
Stock options – the right to purchase stock in the Company at a fixed price (“exercise price”) for set period of time-generate many of the questions facing a startup lawyer. This relates to the popularity of options as a way to compensate employees and contractors. Benefits: Properly structured options are…
Q: How should I invest in insurance for my startup? What types of insurance do I need? What can I expect from the claim process? A: A full risk assessment of your company’s developing business requires an audit of your potential liabilities. However, as a general rule…
The most common exit for early-stage companies is acquisition by another company. Because early-stage companies by definition do not have a long history of revenue and earnings performance, it can be difficult for the buyer and seller to agree on valuation. The seller will argue for a…
Startups have bigger concerns than privacy, or so they think. Many startups have learned that being young and small does not keep them off the radar screens of privacy regulators, and they can be vulnerable to costly investigations. Privacy issues that come to light in the course…
In our Emerging Companies & Venture Capital group, we often work with founders and early- stage companies that are in the process of raising their first round of financing. On occasion, this takes the form of a “friends and family” round, consisting of a group of supportive…
It’s a proud day when you receive your first round of funding. Each subsequent round helps build your dream, but at a cost. As commitments are made, do you take the time to think about how much company you now own? BothSidesofTheTable.com put together this infographic on…
Key to any early stage fundraising effort is a well-crafted Executive Summary, or Exec Summary. This succinct document describes your new venture and preemptively addresses fundamental questions that prospective investors will have. I have read hundreds of executive summaries over the years. And, the few good ones…
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