Start-Ups & Financing
Structure Law Group, LLP start up attorneys in Austin are proud to have represented many once small start-ups that have gone on to become major players in the tech industry. With locations in Silicon Valley, Los Angeles, and Austin, we are situated at the heart of the major tech centers in the U.S. Our firm was there during the “dot com boom” of the mid-’90s helping entrepreneurs secure capital from their parents’ garages.
SLG’s Texas startup attorneys take pride in representing entrepreneurs in the early phases of the development of their company. By understanding your company’s goals, culture, and roadmap for growth, we can help your company make the best choices to secure funding, meet tax and regulatory obligations, and insulate you from liability, making your startup as profitable as possible. Below, we will discuss our individual services in more detail.
Structure Law Group, LLP Austin start up attorneys’ legal team will focus on your startup’s total life cycle providing counsel on securing funding, growth management, and exit strategies. We help Texas start up entrepreneurs understand the pros and cons of each choice they make and how it could impact their company’s future. We assist new businesses choose a corporate structure, and incorporate as well as draft stakeholder agreements, equity incentive programs, and convertible debt financing agreements for all clients start up needs.
As your Austin, TX company continues to grow, we will meet the needs of your investors, stakeholders, and the venture itself. Our Austin startup attorneys can also assist you in the sale or dissolution of the company if the time is right. SLG ATX has helped both public and private companies and assisted in transactions valued up to hundreds of millions of dollars.Investor Agreements and Personal Investments for Austin Start-Ups
SLG helps our clients create and update investor agreements to meet the changing needs of your startup. SLG’s approach has a proven track record of success for structuring stakeholder relationships through founder agreements, equity incentive programs, and debt financing agreements. As your Texas business continues to grow, SLG will help you meet the needs of venture capital and other investors by structuring financing arrangements that meet the needs of both your investors and your venture. Additionally, we can help you avoid regulatory issues that emerge from friends and family contributions or “personal investments”, as well as other investments by investors.
Provisions in funding agreements include the following:
- Is repayment required? If so, what are the interest rates, repayment schedules?
- Does the investor receive an ownership stake in exchange for the investment?
- Is the ownership interest a financial stake? Voting equity?
- Management decision-making authority? Some combination of the aforementioned?
- How long does the investor’s ownership stake last?
- Can the company buy back the ownership stake and if so, what are the terms?
- How are disputes between the venture and investors handled?
- Do other investors or board members have seniority over the investor’s interest?
All of these are issues that need to be addressed prior to seeking capital contributions.Venture Capital for Austin Businesses
Traditionally, capital is secured through venture capital and hedge funds. The Austin, TX corporate attorneys at SLG assist our clients in the process of securing funding by ensuring proper reporting, filing, and disclosures are made in compliance with the prevailing regulations. SLG doesn’t just provide our clients with legal representation, we can also help introduce you to our network of board members, financial and operational advisors, as well as referrals to bankers and CPAs. We will help your venture link with experienced contributors who can help your venture grow and thrive.Crowdfunding for Austin Start-Ups
Financing a startup is different than asking for money as an individual. The SEC requires specific actions be taken to ensure compliance with investor-protection programs. If you are considering using one of these sites to fund your startup, having a skilled Austin startup attorney look over your paperwork to ensure you are not violating any laws can prevent substantial losses, regulatory actions, fines, and more down the line.
It’s important to understand that the SEC requires crowdfunding transactions to go through an intermediary such as a broker-dealer or a funding portal. These regulations place caps on the total amount of capital that can be raised by a company and on the total amount of money a single investor can give over a 12-month period. The SEC will require specific information to be disclosed to investors, the intermediary handling the crowdfunding transaction, and the SEC itself. Violations of SEC regulations can result in a “bad actor disqualification”, meaning the individual would be barred from making public offers henceforth.
GoFundMe and Patreon are becoming increasingly common for innovative projects to secure capital. While this may seem like a decent way to generate funding, it’s different when you’re crowdfunding a business venture, even Patreon donations are subject to federal and state regulations. Start-ups looking to secure funding in this way must avoid the pitfalls of SEC violations. An Austin startup attorney at SLG can help avoid compliance issues that can cause legal problems in your company’s future.Business Loans for Austin Start-Ups
Loans can be used in conjunction with other financing options to help offset the difference between outside contributions and the amount of capital you will need to get your startup running. The attorneys at SLG in Austin, TX will work closely with your company to ensure that loans are meeting the needs of your company and not interfering with other financing options. This includes conducting a document review to ensure that one source of funding is not preventing you from pursuing a different source of funding. In some cases, banks will not offer loans to businesses if there is another creditor whose contribution has more seniority than theirs. Our Texas startup attorneys can help you avoid these conflicts.ICOs and Blockchain Funding for Austin Start-Ups
ICOs or initial coin offerings use blockchain technology to help businesses get contributions. While it is relatively easy to set up an ICO with the proper know-how, businesses often land themselves into trouble without proper legal guidance.
ICOs come in two different types, security tokens, and utility tokens. Security tokens are essentially equity exchanges like stock. Utility tokens offer business-related services in exchange for money. It is extremely important to note the difference because security tokens are regulated by the SEC while utility tokens fall under regulatory exceptions. Our attorneys can help your Austin startup manage the regulatory traps of ICO funding without worrying about SEC violations and investor lawsuits.Talk to a Structure Law Group Austin Startup Attorney Today
Structure Law Group, LLP has locations in Silicon Valley, Los Angeles, and Austin, TX. We have helped Austin startup businesses secure capital, meet regulatory requirements, and keep investors happy as they grow and expand. Call today ay (512) 881-7500 to discuss your venture or fill out our online form and our Austin startup attorneys can begin discussing your goals for your company and how we can help you meet them.