Startups

Startups, unlike traditional companies, often use or seek early-stage money from non-founders. While these investors are generally more flexible than later-stage venture capital investors, they are still entitled to certain legal protections and will also expect a degree of organization not always required by companies that are owned, run and financed by a single founder. In addition, technology-based startups often depend on intellectual property in which other entities — universities, for example — have legal rights or ownership. These issues need to be understood and managed early on in the startup’s evolution.

Phillips Lytle’s Startups attorenys has extensive experience guiding startup companies through every step of their lifespan. Our expertise spans entity formation to obtaining venture capital funding and beyond. We use a multidisciplinary approach to draw on expertise from our practice and industry teams to ensure startup clients receive unparalleled support and counsel. We are also willing to invest our own time in getting to know your company by talking with you, without charge, in the initial consultation.

You can contact our team by filling out the form on this page or by contacting the Phillips Lytle office closest to you.

The broad list of legal decisions a startup must confront begins from day one. What type of entity will you be, and in which state will you choose to form that entity? What is the relationship among co-founders? What will current and future investors expect to see to make the startup more investment-ready? Who else has rights to the startup’s technology? How do you compensate employees or consultants when the company has no revenue at the moment? These are all questions of particular importance to startups and the types of challenges Phillips Lytle’s Startup attorneys are well-versed in addressing.

The sooner, the better is the case when it comes to startups and interviewing attorneys. An experienced startup attorney will help you avoid expensive mistakes in entity formation, raising funds, protecting intellectual property, navigating regulatory compliance, and recruiting and retaining talent. By hiring an attorney early on, founders can keep their focus on growing their business while their attorney manages any of the legal challenges they face.

Angel investors are usually high net worth individuals who have an interest in investing, usually locally, in startups. They certainly want to achieve a high rate of return, but also have community or philanthropic reasons for investing as well. Often, they have exited their own startups and want to pass on some of their acquired practical knowledge. They may invest individually or in groups. There are local angel funds in many cities, and there are local angel investors in all the communities in which Phillips Lytle has offices.

Venture capital investors are professional investors who have raised money from investors of their own and are making larger investments than angels. They will also require market terms for their investment vehicles and are usually where startups turn when their capital needs increase.

Phillips Lytle’s Startups team has handled all levels of startup investment, on all sides of the table, from early stage “friends and family” investments to angel investment, to venture capital, private equity and eventual exit in an M&A transaction.