Startup Lawyer

Category: Incorporation

  • The When to Incorporate Decision-Matrix

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    Ryan Roberts
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    In a recent post, I detailed some incorporation-related points of interest if I launched my own startup. The post presumed I made the decision to push forward with the incorporation of my startup. But how do you know when the time is right to incorporate your startup? Advice Varies There’s a wide range of counsel…

  • The 5-Second Guide to Choosing Your Startup’s Legal Entity

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    Ryan Roberts
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    Corporation. Because if you can log on to the Internet, you can handle the complexity of a corporation. Don’t be scurred.

  • Should a Founder License IP to a Startup?

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    Ryan Roberts
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    Often a startup founder will desire to license his or her intellectual property to a new startup venture, rather than transfer ownership to the startup at incorporation via a technology assignment agreement. This is a bad idea. Founder IP License Problem Even if the founder offers the startup a completely startup-favorable license, the founder IP…

  • Lockdown Lost-Founder IP

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    Ryan Roberts
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    If you won the lottery today, how many long lost relatives (that you don’t recall) would come out of the shadows of your family tree to test the generosity of their favorite relative? I’m willing to bet a few. Now if your startup received a $5MM Series A investment from a venture capital firm, how…

  • 25102(f) Notice: Only in California

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    Ryan Roberts
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    Founders must pay special attention when their startup issues securities–even when those securities are issued to themselves at incorporation. Whether or not founders realize it, they are issued their founders stock via an exemption from registration at both the federal and state level. The federal exemption most likely available for founders is Section 4(2) of…

  • What is Four Years With a One Year Cliff?

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    Ryan Roberts
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    Four Years with a One Year Cliff is the typical vesting schedule for startup founders’ stock. Under this vesting schedule, founders will vest their shares over a total period of four years. The one year cliff means that the founders will not get vested with regards to any shares until the first anniversary of the…

  • The Delaware Freak-Out

    The Delaware Freak-Out

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    Ryan Roberts
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    The New Year. For some, it’s time to reflect on the past and look forward to the future. For others, it’s time to make resolutions to change for the better. But for me, it’s time to respond to client inquiries regarding their apparent 5-figure bill for Delaware franchise taxes due March 1. Authorized Shares Method calculation…

  • Accountants Heart LLCs

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    Ryan Roberts
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    I’ve never had a client’s accountant recommend any legal form besides the LLC for a new startup. Even though I heart corporations, I still believe the LLC can be an appropriate legal entity for some companies and ventures. But when it comes to a startup looking to (i) raise capital, and/or (ii) issue incentive equity…

  • How to Split the Startup Founder Equity Pie

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    Ryan Roberts
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    Founders frequently ask me to provide guidance on how their startup should split equity between co-founders. My answer is always: (1) It Depends, and (2) Quickly. (1) IT DEPENDS If you’ve ever hired a lawyer, you will (unfortunately) hear the phrase “it depends” several times. In this situation, the “it depends” hinges on the respective…

  • Is Your Startup’s Name Available in Delaware?

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    Ryan Roberts
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    Delaware has a pretty sweet Name Availability Search Tool via their Division of Corporations. If your desired entity name isn’t available to reserve, then that name isn’t available for a new corporate entity filing in Delaware. If your startup name is available, you can reserve the name online for $75. Finding out whether you can…