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Can I Raise Venture Capital as a Public Benefit Corporation?
By Ben Stone
As societies and markets increasingly insist that corporations generate positive social impact alongside profit, investors have taken notice. The global impact investing market alone, for instance, doubled from $114 billion in 2017 to $228 billion in 2018, and will almost certainly continue to accelerate. [1]
10 Shortcuts Entrepreneurs Should Not Take When Starting a Company
By Robert Giachetti and Mark Higgins
Congratulations - you have done it! You had an idea, you built a product, you figured out how you want to go to market, and you created a company. With that tedious process complete, you are ready to find your first customer, iron the bugs out of your product, and start making money.
Is Your Commercial Co-Venture in Compliance in all 50 States?
Commercial co-venture arrangements are a great way to blend philanthropy and commercial activities, but the parties in such an arrangement need to be mindful of the rules in each of the 50 states that govern commercial co-venture arrangements. If a person or for-profit company joins forces with a charitable organization to benefit the charitable organization, usually via donations, the parties have entered into a commercial co-venture arrangement for a charitable sales promotion.
Convertible Notes for Startups
Hear the emerging growth advisors and creators of Mintz's MintzEdge program, Dan DeWolf and Samuel Effron, discuss the ins and outs of convertible notes for startups, including the advantages and disadvantages from a legal and funding perspective.
How to Distribute Equity in Your Start-Up
By Patrick Elahmadie
The purpose of granting equity to management, employees and certain consultants is to align the interests of the parties pivotal to the growth of your company with the interests of investors. There are a number of different ways to grant equity in a start-up, the most common of which is stock options
MintzTech Connect Industry News — February 2019
By Dan DeWolf and Samuel Effron
This issue of TechConnect covers issues for emerging companies to consider when dividing and sharing equity and disproportional rights and controls for directors.
Employment Law Basics In California
Jennifer Rubin, a Member in the Employment, Labor & Benefits Practice, and Sebastian Lucier, a Member in the Venture Capital & Emerging Companies Practice, discuss employment law related matters for companies operating in the state of California, including the challenges relating to characterizing an individual as an employee rather than an independent contractor.
CAUTION: Director Veto Rights in Financing Documents May Constitute “Disproportionate Voting”
By Lewis Geffen
Section 141(d) of the Delaware General Corporations Law (DGCL) allows the certificate of incorporation (COI) of a Delaware corporation to confer upon one or more directors voting powers greater than or less than those of other directors, thus resulting in “disproportionate voting” rights amongst the Directors.
How To Get Started: Dividing Equity, Getting Incorporated and Other Details When Beginning Your Business!
By Dinesh Melwani and Will Perkins
Just about every emerging business/start-up lawyer could write a book (and many have!) on the topics of equity division, incorporation and the innumerable ‘other details’ founders need to keep in mind when starting a business!
LLCs and Convertible Debt – Too Good to be True?
By Scott Pinarchick and Will Bussiere
Founders choosing a structure for their business are often drawn to the limited liability company, or LLC, for its overall flexibility in both taxation and governance matters. And founders seeking access to early capital, not to mention seed investors themselves, are often drawn to the convertible note as a simple, less expensive means to raise funds.
MintzTech Connect Industry News — November 2018
By Dan DeWolf and Samuel Effron
This issue of TechConnect covers liability considerations for directors of Delaware public benefit corporations and profiles FinTech company Templum.
Digital Tokens: Rethinking the Term “Cryptocurrency”
By Dan DeWolf, Rachel Gholston, and Marine Bouaziz
What are the similarities between a one dollar bill, a share of a company, and a pre-paid gift card? The answer is……..not so much! The same is true of the similarities between virtual currencies, security tokens, and utility tokens; in truth, not so much.
Issues in Chinese Foreign Direct Investment in U.S. Early Stage Biotechnology Companies
By Flora Brookfield
There has been a marked increase in the amount of money being invested by Chinese investors into U.S. early stage biotechnology companies since 2017, spurred on by direct encouragement from Beijing through its Made in China 2025 industrial policy, which specifically targets biotech as a strategic industry eligible for greater government backing. In the first half of 2018, Chinese venture capital funds and high net worth family offices invested $5.1 billion in US biotech companies, exceeding the $4 billion invested by Chinese investors in all of 2017.
MintzEdge 101: IP Strategies For Start-Ups - Sean Grygiel (Mintz)
Sam Effron, a Member in the Mintz Venture Capital & Emerging Companies Practice and co-editor of MintzEdge, sits down with Sean Grygiel, a Member in the Mintz Intellectual Property Practice, to discuss key IP considerations and strategies for new companies.
Founder’s Stock – a Legal Fiction
By Michael Bill
In common usage, a founder is an individual who creates or helps create a company, but in legal terms, there is no such thing as a “founder” or “founder’s stock,” only early participants in a company’s organization and ownership of its initial equity capital. Why is this so? Because, for all practical purposes (from a startup’s point of view), there are two types of stock – common stock and preferred stock – and “founders” are just the initial holders of the company’s common stock, usually before any financing, in-licensing, or contribution of assets.
Liability Considerations for Delaware Public Benefit Corporations
By Will Perkins and Christina Bailey
A public benefit corporation (PBC) is a statutorily designated type of corporation in Delaware that melds two concepts that are often seen as opposites: maximizing profit and providing public benefit. This choice of entity presents a compromise for those companies who are committed to operating in a responsible and sustainable manner, while acting as a for-profit entity.
MintzTech Connect: All Things Technology — September 2018
By Dan DeWolf and Samuel Effron
This edition of TechConnect offers tips for entrepreneurs who may want to sell their companies, profiles newcomers Rocketbook and the Zeus Network, and provides a list of upcoming events.
MintzEdge 101: Optimizing The Sale Of Your Company - John Rotchford (SASI)
John Rotchford, founder of SASI, a boutique investment banking firm, discusses how to prepare your company for sale, how buyers will value your business, and how to achieve a favorable and timely outcome.
The Form is Always Wrong
By Dan DeWolf and Samuel Effron
Mintz attorneys are often asked as to why we don’t simply provide “forms” on our website that can be downloaded and used. After all, a number of law firms let you download term sheets and other forms such as SAFEs. Our simple answer is: THE FORM IS ALWAYS WRONG! Legal forms are merely starting points and most forms are typically only half an inch deep. A successful enterprise truly needs so much more depth than what is provided in a basic form.
What to Do Now if You Want to Sell Your Company
The global M&A market has remained strong from the end of 2017 into 2018. With stockholders pressuring larger companies to grow their revenues and the strong liquidity position of many companies, it is a sellers’ market. For companies looking to sell and participate in the global M&A market of $3.7 trillion in 2017[1] and $890.7 billion in Q1 2018[2], the toughest question is often how to start.
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