Canada | United Arab Emirates
Industry sectors
Tech Startups
Many businesses begin with great ideas, but inspiration alone isn’t enough to make a business successful. The right guidance is essential, from choosing the right form of business entity, to identifying and attracting the right team, identifying and protecting intellectual property and strategic advantages, securing financing, and more.
Our practice is based on 25 years of experience working with early-stage enterprises in many fields, including rapidly evolving fields like artificial intelligence and cybersecurity. We have worked with numerous startups and businesses from their inception onward, identifying and resolving questions that startups face, including:
» Entity selection
We can advise you on the most appropriate entity type – whether LLC, sole proprietorship or otherwise.
» Intellectual property
TMT Law can assist you in identifying your intellectual property, as well as ensuring that it is adequately protected and monetized.
» Identifying the Team
Who will participate in your business? Are all inventors, contributors, and co-founders included or accounted for, and have they all forward contributed to the entity the intellectual property rights and opportunities that will carry the venture?
» Equity allocation
We can help answer all the questions you may have regarding the allocation of equity in your business. For example: Who among the founding team gets what shares of equity? What about vesting, and returning shares to the company if a founder leaves? How does dilution work, and is it bad? When should the startup switch from founders' shares to stock options, and why? How will outside financing affect the equity allocation?
» Fundraising
How will the venture fund its initial activities? Is there any governmental assistance available for your business? What are the advantages and disadvantages of convertible notes, SAFEs and other delayed-dilution financing tools? When it is time to seek dilutive equity, how should the startup establish and defend its pre-money valuation? What will the cap table, and the founders’ ownership percentage, look like after the investment round?
» Employment issues
Startups often attempt to engage non-employee consultants or "independent contractors," only to find out later that they have inadvertently created an employer-employee relationship. The relevant law in this area can be counter-intuitive, so this mistake is common, as well as being costly and distracting to startups. Knowledgeable legal guidance helps to establish relationships with co-founders and service providers while avoiding these issues.
» Negotiation of transactions
Early-stage partnering, co-development and service agreements can present significant issues. Big questions frequently arise regarding, e.g., who owns improvements to the core innovation? What kind of exclusivity is appropriate, and what other market benefits should an early-stage strategic partner get? What happens if and when the partnership ends?
TMT Law knows what's important to startups, and what can and should be negotiated in their dealings with other parties. We understand the steps to take in the development of a business, and can guide clients through the process knowledgeably and efficiently.
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