Legal Structuring for Startup Companies

2022/2023

Учебный год

ENG

Обучение ведется на английском языке

3

Кредиты

Кто читает:

Департамент правового регулирования бизнеса

Статус:

Курс по выбору

Когда читается:

3-й курс, 4 модуль

Преподаватель

Новикова Ольга Владимировна

Course Syllabus

Abstract

This course examines the legal aspects of venture capital ecosystem from both a theoretical and a practical perspective. It explores the role of the legal systems in creating and sustaining a climate that facilitates entrepreneurial activity and the role of counsel in helping to launch, grow and protect new businesses. It considers the following stages in the life cycle of a start-up: formation (pre-formation issues, different forms of business organization, NDAs, contractual arrangements and other legal protections for corporate assets and opportunities, and governance and control under VCs); employment relationships (certain legal aspects of developing, rewarding and retaining employees, including non-competition agreements, assignments of rights, and employment litigation); and growth and exits (strategies for maximizing the value of intellectual property, founder/VC disputes , wash-outs, and legal aspects of exit strategies, including PE exits and IPOs). The class will analyze each step in the process from the perspective of the company, the founders and employees, the investors, and counsel for the various parties, and their respective fiduciary and ethical duties. It also will consider the incentives and control structures deployed at each step of the process, with a focus on pragmatic considerations in structuring the transactions. We will strive to make the classes highly interactive. There will be required readings for each session that include a range of materials from practitioners' blog posts to model deal documents, applicable statutes and substantive case law. We will also review a full set of typical venture capital deal documents, drafting considerations, relevant statutory and case law, essential valuation concepts and basic tax considerations. Simple spreadsheet exercises will be included to illustrate financial impacts of different deal terms, but no prior experience in creating spreadsheets is required. Students will be expected to contribute to class discussions, participate in teams in a term sheet negotiation exercise and complete a take-home, open book final examination.

Learning Objectives

• The aim of the course “Legal Structuring for Startup Companies” is to teach students the legal aspects of venture capital ecosystem from both a theoretical and a practical perspective.

Expected Learning Outcomes

• In-depth knowledge of the basic notions, criteria and operating principles of startup companies; ability to define the principal stages of business development and the role of institutional assistance to small enterprises; correct use of legal terminology in the field of entrepreneurship.
• Ability to explain the principles of choice of state and legal forms of incorporation; use of specialized methods to analyse and process legally significant information.
• In-depth knowledge of the basic notions, criteria and determining principles of the basic rules governing the status of corporations; ability to identify juridical facts in respect of the basic rules governing the status of corporations and corporate groups; ability to apply existing statutes and regulations (conventions, national law and customs) to juridical facts; ability to analyse and process legally significant information and practice with the help of specialized methods.
• In-depth knowledge of the basic notions, criteria and determining principles of organizing corporations; ability to identify juridical facts in respect of formation of company’s by-laws; ability to apply existing statutes and regulations (conventions, national law and customs) to juridical facts; ability to analyse and process legally significant information and practice with the help of specialized methods;
• ability to work with specialized legal systems (databases); ability to perform the legal evaluation of documents in the field of corporate law.
• In-depth knowledge of the basic notions, criteria and determining principles of organizing parterships; ability to identify juridical facts in respect of formation of the partnership agreement; ability to apply existing statutes and regulations (conventions, national law and customs) to juridical facts.
• Ability to analyse and process legally significant information and practice with the help of specialized methods; ability to work with specialized legal systems (databases); ability to perform the legal evaluation of documents in the field of corporate law.
• In-depth knowledge of the basic notions, criteria and determining principles of corporate governance; ability to identify juridical facts in respect of the stock distribution and shareholder agreements; ability to apply existing statutes and regulations (conventions, national law and customs) to juridical facts;
• ability to analyse and process legally significant information and practice with the help of specialized methods; ability to work with specialized legal systems (databases); ability to perform the legal evaluation of documents in the field of corporate law.
• In-depth knowledge of the basic notions, criteria and principles of financing of small business; ability to identify juridical facts in respect of attracting investments;
• ability to apply existing statutes and regulations (conventions, national law and customs) to juridical facts; ability to analyse and process legally significant information and practice with the help of specialized methods;
• аbility to work with specialized legal systems (databases); ability to perform the legal evaluation of documents in the field of corporate law.
• In-depth knowledge of the basic notions, criteria and principles of intellectual property law; ability to identify juridical facts in respect of intellectual property;
• ability to apply existing statutes and regulations (conventions, national law and customs) to juridical facts; аbility to analyse and process legally significant information and practice with the help of specialized methods;
• Ability to work with specialized legal systems (databases); ability to perform the legal evaluation of documents in the field of intellectual property law .
• In-depth knowledge of the basic notions, criteria and principles of NDA, labour, and data protection agreements for start-up operations; ability to identify juridical facts in respect of the basic agreements for start-up operations; abilitу to apply existing statutes and regulations (conventions, national law and customs) to juridical facts;
• ability to analyse and process legally significant information and practice with the help of specialized methods; ability to work with specialized legal systems (databases); ability to perform the legal evaluation of documents.
• In-depth knowledge of the basic notions, criteria and principles of tax law; ability to identify juridical facts in respect of tax law; ability to apply existing statutes and regulations (conventions, national law and customs) to juridical facts;
• ability to analyse and process legally significant information and practice with the help of specialized methods; ability to work with specialized legal systems (databases); ability to perform the legal evaluation of documents in the field of tax law.

Course Contents

• Subject 1. Entrepreneur and entrepreneurship.
• Subject 2. Choice of state and legal forms of incorporation.
• Subject 3. Key characteristics of corporations and corporate groups.
• Subject 4. Legal mechanics of organizing corporations.
• Subject 5. Legal mechanics of forming partnerships.
• Subject 6. Legal structuring for founders and key players.
• Subject 7. Raising start-up money and structuring investments.
• Subject 8. Structuring intellectual property rights.
• Subject 9. Basic agreements for start-up operations.
• Subject 10. Key points on taxation of startup's income.

Assessment Elements

• Oral exam
• In-class participation
• Test

Interim Assessment

• 2022/2023 4th module
  Students may choose the following combinations of assessment elements for calculating the interim grade: 1. Test only. The interim grade for the course is determined according to the table. 2. Oral exam only. The interim grade for the course is determined according to the table. 3. Test and In-class participation. The interim grade for the course is determined according to the table. See: "Tables for Calculating the Interim Grade" in Assessment Materials.

Bibliography

Recommended Core Bibliography

• Acceleration : what all entrepreneurs must know about startup law, Roberts, R., 2019
• Entrepreneurship : an innovator's guide to startups and corporate ventures, Meyer, M. H., 2011
• Micic, I. (2015). Crowdfunding: Overview of the Industry, Regulation and Role of Crowdfunding in the Venture Startup. Anchor.

Recommended Additional Bibliography

• Sahlman, W. A., Hoffman, R., Andreessen, M., & Blank, S. G. (2018). HBR’s 10 Must Reads on Entrepreneurship and Startups (featuring Bonus Article “Why the Lean Startup Changes Everything” by Steve Blank). Boston, Massachusetts: Harvard Business Review Press. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=1798805
• Жизнь как стартап : строй карьеру по законам Кремниевой долины : пер. с англ., Хоффман, Р., 2013
• Метод стартапа : предпринимательские принципы управления для долгосрочного роста компании, Рис, Э., 2018