A startup is a popular and relatively new phenomenon in the economy. The term was first used in the 70s of the last century (when writing an article in Forbes magazine) to refer to newly established companies. Over time, the word “startup” has been interpreted in different ways, but so far, this term has not been officially enshrined in the laws of different countries, including the laws of Ukraine. It is generally believed that the IT industry dictates the most accurate interpretation of the term, which most often uses the word startup to mean any young company that creates a new product and operates under conditions of uncertainty and risk.

 

Many niches of the economy are highly competitive, so new, non-trivial ideas can ensure a successful start for a project, provided that there is competent legal registration and well-designed technical implementation. It is vital for startups to interact with investors, counterparties, and clients, which cannot happen comfortably and correctly without legal support. Many start-up entrepreneurs are frightened by the high cost of legal services, which, in their opinion, may prove to be an unbearable burden before the business actually pays off.

 

In fact, legal services for startups, which solve many issues related to the organization of a young company’s work, are a cost-effective service. Thus, with the help of experienced lawyers of Lawrange, you will be able not only to open a company quickly, but also to choose the most favorable taxation system, correctly draw up the necessary documents and protect your business brainchild from unscrupulous competitors. Any mistakes, even the smallest ones, at the start can have a negative impact on a young business, but the availability of qualified support eliminates this risk.

 

More about the benefits of legal support for a startup

People who create a startup are definitely talented and motivated, but it is impossible to know everything about everything. And in order not to waste time on a thorough study of all legal aspects, it is recommended to trust a lawyer – a person who has spent more than one year gaining deep knowledge and extensive practice. This specialist knows how to protect your idea, business, and income. Cooperation with him or her is guaranteed to have several important advantages.

 

Regulation of business relations with investors

Most startups start with limited funding, and therefore one of the main tasks is to find “business angels” – investors who will believe in your idea and support it financially. This can be a loan on mutually beneficial terms, a contribution to the authorized capital, or crowdfunding – in any case, you will need to properly formalize your relationship with your investor to avoid problems in the future. For example, quite often an innovative business idea is bought for a song because its author failed to understand the nuances of financial support specified in the agreement. In such cases, legal support for startup projects will protect against the risk of losing control of the business, while helping to obtain the necessary funding.

 

Correct construction of business processes and development of a clear scheme of activities

Starting a business is always time-consuming, so a future entrepreneur will need help in the form of a thorough analysis of various issues related to his or her idea. A well-thought-out and well-drafted business plan, as well as the right choice of an organizational and legal form, will help you set the right direction for your business. Experienced specialists of Lawrange will help you plan and structure the work of the organization for convenient control of your company at all levels. We will work on creating related documents, regulating the work of employees and resources that are an integral part of the business process.

 

Protection of unique ideas and products

Very often, startups are created on the basis of any result of intellectual activity, such as know-how or innovative software. In any case, the idea (or product) acquires value, and therefore it should be protected from the actions of unscrupulous competitors. Legal support services for startup projects will not only protect intellectual property but also ensure stable profits from its use. Our specialists will help you to obtain a patent for technical ideas and register copyright for intellectual property.

 

Safe operation of a business entity

Modern entrepreneurs have to start a business in an environment of increased competition and the establishment of control by criminal organizations over various sectors of the economy. Government agencies consistently put pressure on business entities, while legislation is characterized by instability and imperfection – all of which combine to threaten the stability of a startup and its overall viability. The availability of qualified legal support helps to protect entrepreneurial activities from difficulties and common risks.

 

Support of startup projects by type of activity

Startup projects can be based on both high technology and traditional areas, with ideas that are easy to implement. It is not necessary for a young business project to deal with cloud computing, cryptocurrency, and artificial intelligence. There is a fairly large list of sectors in conservative industries that are adapting to modern market conditions. For each type of activity, our specialists are ready to provide professional legal support.

 

Fintech projects

Legal services for such companies include advice on:

 

  • Regulation of ICO, STO, IEO in different countries along with full legal structuring of projects.
  • Finding the most suitable jurisdiction for opening a cryptocurrency company.
  • Determining the business model, strategy, and concept of a startup project.
  • Peculiarities of preparing and passing KYC and AML procedures.
  • Launching blockchain-based platforms that provide fintech services.
  • Compliance with legal requirements for obtaining EMI licenses.
  • All issues related to blockchain projects, from assessing the legal requirements of a particular country to providing recommendations for compliance with the law.

 

Lawyers also accompany every stage of registration of fintech companies and obtaining the relevant licenses. They assist in preparing a package of necessary documentation, submitting applications to regulators, and coordinating all formalities with financial institutions, notaries, and government authorities.

 

Work with IPOs

Legal support for startups working in the field of IPO will ensure a successful share placement. Experienced specialists will advise you on which jurisdiction will be most beneficial for your project, help you place your shares on the stock exchange, which will help to increase its profile. We will provide all necessary consultations on listing issues and provide comprehensive support in preparing the company to meet the listing requirements. We will conduct due diligence of the startup before it enters the IPO market, including the preparation of underwriting documents. Other services will also be available to companies:

 

  • Advice on the roadshow process, on the content of the prospectus for the AIM listing, on measures to reduce the startup’s IPO risk.
  • Supporting the company in IPO-related disputes.

 

Minerals extraction

It is extremely important for investment start-ups wishing to develop large international markets to enlist legal support. With the help of experts, you will be able:

 

  • to choose a suitable country to launch a natural resources project;
  • to determine the legal form of incorporation in the EU, Asia, the US, and Africa;
  • to register a mining company in the USA, Europe, or Africa;
  • to get information on all the nuances of a mining project;
  • to conclude M&A transactions in the mineral resources sector with confidence;
  • to understand all the financial nuances;
  • to get a detailed analysis of investment activities and future prospects after the project launch.

 

In addition, we will help you obtain licenses for prospecting (exploration) of natural resources in various jurisdictions and advise on all issues related to management and social aspects.

 

Agriculture sector

Legal services for startups operating in the agricultural sector often involve the need to support the process of registering an agricultural business. Experts also help to understand all the nuances associated with financing such startups or buying them. Projects in the agriculture sector cannot do without professional outsourcing of agribusiness and legal support in case of land disputes.

 

Industry

This largest sector of any economy concentrates a significant part of the labor force. Industry forms the basis for the gross domestic product (GDP) of each individual country.

 

Legal services for support of startup projects in the industry are presented:

 

  • Assistance in choosing legal form of organization and jurisdiction for starting a business.
  • Advising on industrial outsourcing and property protection.
  • Supporting mergers and acquisitions and industrial disputes.

 

Our experts will also advise on all financial issues related to the operation of a startup project.

 

IT industry

IT lawyers have in-depth knowledge of intellectual property, consumer rights, and antitrust laws. They will clearly distinguish between copyright and related rights, as well as the rights arising from the registration of IP objects. With their help, startup owners will be able to organize the necessary currency control and conclude foreign economic transactions.

 

Legal services for startup projects in the IT sector are diverse, ranging from advising on information technology regulation and tax optimization to comprehensive support in the creation and further operation of an IT startup. Our specialists can assist in registering companies in many jurisdictions: EU, USA, Asia or offshore zones. Since it is extremely important for any enterprise, including an IT company, to be able to work with various transactions, make money transfers, purchase and pay for services, IT lawyers will help you open a bank account in the jurisdiction in which you decide to register a startup.

 

What services are included in legal support for startups

We provide all the services necessary for the proper organization and structuring of the business, optimization of costs and taxes. With qualified legal support, it will be much easier and safer to attract investment in the project, as well as much more.

 

Pre-project consulting

The task of our specialists is to learn as much as possible about the essence of the startup, its participants, investors, and the legal grounds for implementation. During the consultation, we manage to formulate the economic, financial and legal aspects. We will work out possible ways of finding investors, lending, investing, consider risks and suggest ways to prevent them.

 

Development and implementation of a startup’s corporate structure

Proper corporate structuring is an important step on the way to market development. Our experts know how to start preparing for structuring, what documents you will need, what to look for when choosing a jurisdiction, and much more. We will help to unite the funders into a single core, record the initial agreements, and ultimately create a legal entity that will be able to attract investments. Another important support is the conclusion of contracts with local service providers that will ensure the startup’s operation.

 

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Developing a startup financing scheme

To make your business idea a reality, it is important to ensure that you have adequate funding. Lawrange’s attorneys and other specialists will offer you the best options from which you can choose the most suitable one. We will organize the legal formalization of cooperation with investors, contribution of funds by the company’s members, help to attract investments, obtain loans, enter the ICO, etc.

 

Legalization of rights to intellectual property objects

Inventions, industrial designs, trademarks, and other intellectual property objects are subject to the right of registration. It is important that these objects meet the conditions set forth in the laws. There are many legislative subtleties, the ignorance of which can lead to the loss of IP rights. But with legal support, such a problem will not arise, as the registration of rights will be as successful and correct as possible.

 

How startups are financed

When creating an innovative project, it is important to be able to navigate the available sources of funding to successfully attract investors and overcome potential risks more effectively. Startups can use different methods of financing.

 

Cooperation with business angels

A business angel is usually a private individual who invests in a startup at an early stage and receives a share in the young company in exchange. In addition to funding, angel investors may offer mentoring or industry connections. To attract angel investment, a project should be evaluated for its potential and viability to attract additional funding once progress is made.

 

Crowdfunding assistance

It is a fundraising from several sponsors at once through special platforms. Crowdfunding is considered a great way to promote products or services. When launching a startup abroad, reward-based crowdfunding does not require you to give up your authorized capital or part of your property – you simply offer your product or service at a discount.

 

Working with venture capital

This is the best option for large startups with high revenues, providing the opportunity to take advantage of financial, strategic assistance and more. Venture capitalists will be more likely to be interested in your company if it operates in a specific industry, such as software, biotechnology, etc. The geographical coverage of a startup is also important to them – the wider it is, the more chances you have to enlist the support of a venture capital fund.

 

Legal services to support startup projects include the organization and legal formalization of venture capital financing transactions. The main conditions are as follows:

 

  • Evaluation of the company.
  • Determination of the form of investment.
  • Approval of investors’ rights to finance equity participation in the sale of the company, amendments to the charter documents, receipt of periodic financial statements, etc.
  • Developing a mechanism for protecting investments in case future financing is provided at a lower price.
  • Approval of the right to registration, which allows the investor to require the startup to register its shares during the public offering.

 

What loans abroad can small businesses count on

Small startups have a wide range of lenders (from traditional to alternative) at their disposal. These loans will be an effective support for young businesses – they will help them enter new markets, develop a marketing strategy, increase sales, etc.

 

Abroad, small businesses can receive loans in the form of:

 

  • A credit line – a limited amount is set that a startup can use. A dedicated credit line will help manage the company’s cash flow and unforeseen expenses.
  • Accounts receivable financing – also called the AR line. Cash is available immediately depending on the receivables and the interest rate.
  • Working capital loans – a company borrows debt to carry out its daily operations.
  • Term loans – these loans represent a certain amount of money that is issued to solve specific problems.
  • Equipment loans – the purchase of technological equipment on credit, usually with a down payment.

 

Why you should contact Lawrange

Our lawyers have extensive experience in providing legal services to startups of all kinds. We have repeatedly provided support to young projects in different countries and are familiar with all the nuances of the registration process. Professionalism, individual approach and flexible pricing system allow us to provide quality services in all aspects of startup activities. Other advantages:

 

  • Accessibility – we are always available for our clients.
  • Confidentiality – all received documents and client information are protected from leakage.
  • Comprehensiveness – comprehensive legal assistance, including turnkey services.

 

We always keep abreast of any changes in legislation, while striving to learn even more about best practices. All of this combines to enable our team to effectively handle almost any legal consulting issue.

 

Conclusions.

The successful launch of a startup cannot take place separately from legal aspects. Almost every component of the project, from technological aspects to well-drafted documents, is closely related to legal regulations. You should not neglect this fact, as the fate of your startup depends on it. By engaging Lawrange’s legal support experts, you will provide your project with protection from various risks, assistance in regulating business relations with investors, access to detailed, useful advice, and much more.

 

FAQ

What legal structures are available for organizing a startup?

The choice of legal form depends on the jurisdiction in which you intend to launch your project. In Ukraine, for example, sole proprietorships and LLCs are often chosen for these purposes, while in foreign jurisdictions, partnerships, analogs of LLCs, etc.

 

What laws and regulations do you need to follow when launching a startup?

There are many legal requirements to consider when creating a startup. They may differ slightly depending on the jurisdiction, but there are several general legal aspects that must be taken into account, such as the legal structure, participation in the taxation system, and intellectual property rights.

 

How can legal services for a startup help resolve conflicts and disputes?

A lawyer will take part in dispute resolution, represent your business interests during pre-trial proceedings, in court and in government agencies.

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