Blog / Start- Ups
In the regular corporate world, the capital structure of a company usually means the ratio between the company’s equity (money the company’s owners invested in it) and debt capital (external funding injected into the company by banks and other loans). For technology companies, however, the term “capital structure” usually refers to the division of the company’s ownership among the entrepreneurs and investors subsequent to the investment rounds in the company. Thus, holding 50 shares of a “regular” company that has 1,000 issued shares represents ownership of 5% of the company’s shares and entitlement to receive 5% of its distributable profits. However, if you hold 50 shares of a tech startup company that has 1,000 issued shares, this does not necessarily mean you are entitled to receive 5% of the proceeds in the event of an “exit” and the startup’s sale to a third party. Over the years, investors and entrepreneurs in startup companies have developed ownership structures that bear no resemblance to the ownership formula used in “regular” companies.
Licensing agreements are the cornerstones of technology companies based on intellectual property. A licensing agreement is a legal contract between two parties, known as the licensor and the licensee. The licensor provides the licensee a right to use and a limited license, while the licensee accepts a series of conditions related to use of the product and payment for such use.
Sample founders’ agreements are available online for download by anyone. Though there are numerous accessible founders’ agreements, a document downloaded from the web is not one you should rely on when establishing your new venture.
Get up in the morning, go to work, sit in meetings, pick up the kids from school, go to the grocery store, work out at the gym, or just meet up with friends and family. It’s hard to believe that until a few weeks ago this described a normal day for most people. It’s clear today that no matter where we work, our age, and where we live, the reality of our lives, both personally and professionally, has changed immeasurably thanks to the new player in the market-the coronavirus.
The Israel Innovation Authority runs a series of programs that support entrepreneurs and companies in the various business stages. It is important to recognize the limitations the receipt of such funding from the Authority imposes upon a project.
In the past three years, an estimated $1 billion has been invested in women’s health technology, and according to Pitchbook, femtech raised $650 million in VC funding last year alone and $241 million so far this year. Still since just around 6% of all decision-makers at U.S. venture capital firms being female, it is not surprising that it is difficult to secure funding for women’s issues.
Blockchain has a well-established presence in the ecosystem, with a variety of use cases across a broad range of sectors, including Fintech, advertising, security, telecommunications and others. Here is an overview of the latest developments regarding blockchain regulations in Israel.
For Fintech companies looking or hoping to work in Israel, the regulatory developments could either serve as an opportunity or as a barrier, and should be carefully considered. Click to read an overview of the Israeli Fintech regulatory situation.
While still widely identified with digital currencies, blockchain technology is also beginning to revolutionize the healthcare industry. See how pharma companies and medical institutions have begun to rely on this technology to resolve problems faster and more efficiently.
Sellers in an M&A transaction are required to make certain statements about the company they are selling. If these statements are not true, the buyer can claim against the seller for any damages it incurs as a result of the inaccuracies. W&I insurance can cover the cost (or part of the cost) of the buyer’s damages.
Despite the many internal and external challenges unique to Israel, the country has successfully transformed itself into a powerhouse of technological innovation. Israel has become an excellent destination for international business, boasting a strong local currency, an active local economy, and robust export industries.
The future is here and Israel’s innovative Smart City technologies are creating a pathway for the nation as well as the world. Central to this crucial development is a remarkable collaboration between the private sector and the government.
Before selling your business, consider these factors to guarantee your company is fully prepared. Following are pertinent reasons why business owners cannot afford to risk a hands-off approach to planning a business exit strategy.
Following its incorporation, every startup company needs a variety of essential legal documents in order to launch its vision and conduct its business. This includes: founders’ agreement, non-disclosure agreement, terms and conditions, employee stock option plan and business plan.
The 21st century robotics industry impacts nearly every facet of life – business, health, commerce, education, and even government. In fact, Tractica, a market research firm, forecasts that this technological area will grow from $31 billion in 2016 to $237.3 billion by 2022.
In recent years, tremendous progress has been made in introducing know-how and technology into sports – despite this being a conservative world concerned that the introduction of new powers might compromise the ethos of sportsmanship.
In its innovative journey, Israel has exhibited technological achievements and economic advancements that have proved it to be one of the strongest leaders in the entrepreneurial world. Through the aid of the Israel Innovation Authority or accelerator programs, Israeli startups are able to receive funding at very early stages of their venture, or a set of tools and insights that fast-track startups in terms of their management skills, business focus, and marketing capabilities.
When you build out your business model, you need more than a great product or service. Innovative brilliance and new ideas matter, but they are not enough. By the time you are ready to raise capital, you should be able to outline for your potential investors a clear market strategy.
When you are ready to raise money to begin or expand operations for your startup, you cannot just ask and wait for money to pour in. Today’s investors are savvier than ever. They need to understand the value you create, for investors and for the market your company will serve. You need to understand your business model thoroughly, but you should also prepare concise answers to the questions any smart investor will ask.
Much of the research and development that goes into new technologies occurs in academic and research institutions and laboratories. But this does not in itself create the new products and processes that change the world. Rather, the technologies are transferred from these academic institutions to the companies that will develop marketable applications.
Today’s world holds more cybersecurity threats every day than it did the day before. Expert estimate that Israel faces 100,000 cyber-attacks every day, and 10 times that amount in wartime. Given the constant threat against businesses and the government, Israel’s national focus on fostering cybersecurity technology and growth seems almost obvious.
Israel has for years led the world in technology and entrepreneurial growth and development. After building in a number of key tech areas like cyber security and biotech, the nation has turned its sights on bolstering capabilities in renewable energy. Recently, the Israeli government announced a new initiative focused on pushing development of renewable energy into the 21st century. This creates a prime opportunity, for Israel’s energy companies and for investors looking to become part of this growth in the years ahead.
The life sciences are advancing at dramatic rates in capabilities and goals. For most of human existence, we have been trying to keep up with the path of diseases as they emerge. Now, we are starting to push more toward prevention and improvement of life in a forward-looking manner. Israel sits at the front of the developmental curve, with over 1,200 active life sciences companies. With its national innovative drive and start-up mentality, Israel provides fertile ground for growth in the sector.
Israel has long been acknowledged and admired for its vibrant start-up culture, fostered through government investment and pro-business policies. Further, the national focus on business development provides a regulatory structure that protects business owners from creditors and ensures proper structure for the public – incorporation. To take advantage of the corporate structure, you need to ensure that you follow the proper registration process, and select the right corporate vehicle to fit your emerging business model.
Funding your startup company is an inexact science. The first round of funding helps get your company established, but often leads to a realization that you need more. After the first round, new issues and growing capital requirements emerge and you need to adjust course moving forward. To help you build your company successfully, you should know what the challenges are in each stage you are in, and to be prepared for them.
Innovation occurs at different levels between one country and another. Innovation does not occur by accident. While some nations depend on individuals to drive the creative process, others provide an environment and infrastructure that foster and support technological development. When a country focuses its attention on providing the best opportunities to innovate, that country can rise above the pack.
For many years now, Israel’s emergence and growth on the world’s economic stage has captured the attention of national and private investors all over the globe. It is only in recent years, though, that this has come to include Japan. In the past few years, more and more Japanese corporations have opened R&D and sales centers in Israel, while business delegations are continually streaming into Israel. One of those companies which recently entered Israel is Fujitsu, the largest IT company in Japan and the fifth largest in the world.
Investors in startup companies need to learn as much about those companies as possible to make an informed decision. You do not want to go in blind before you put money into a startup a company. Still, the company in which you seek to invest needs to protect its confidential and proprietary information; otherwise, it stands to lose the benefit of introducing an innovative solution to the market.
For many small businesses around the world, crowdfunding – the pooling of usually small investments from a large group of investors – facilitates the ability to start a business without large institutional investments in the company. The portfolio of crowdfunding investors is diverse and is comprised of a broad array of ROIs (returns on investment). Investors may be donating to a specific cause, seeking repayment with interest or claiming equity in the company.
Israel’s ‘startup boom’ has grown unfettered for decades. Its emergence as a nation of opportunity for business creation and innovation came not by accident, but through careful planning, tendency to think ‘outside the box’ and constant strive towards execution. All of which have been accomplished due to ability of Israel to support and grow qualified and innovative individuals. After years of steady growth, though, the country now faces some challenges to its positioning in the technology sector. Shortages in their high-tech labor pool and a need for companies to grow more within the country are forcing adjustments. How Israel navigates these concerns will have a significant impact on the year ahead for high-tech companies.
If you think about fertile land for agricultural development, Israel probably doesn’t immediately come to mind. But perhaps it should. Despite a desert climate and the relative youth of the country, Israel’s technological development has created a boom in agricultural innovation, with technology that helps farmers and companies develop healthier, higher-quality foods. With the challenges facing the world’s farming and crops markets, this tiny country provides a wealth of opportunity moving into the future of agriculture.
Financial technology (“FinTech”) is a broad term that encompasses many kinds of technology across many industries. It includes hardware and software, apps and analytics, and solutions for companies of all sizes. Because FinTech plays a role in virtually every kind of company, it is worth taking the time to understand its position in the world economy.
Forming a start-up begins with a great idea. This may be a product or a better way to do something, and it represents the seed from which your company grows. But planting the seed is just the first step. Moving from creating a company to running it as a CEO requires careful, diligent work in a number of areas. Your transition into leadership will often make the difference between your company’s success and failure.
Engaging in any business startup can be risky, and even more so when you are attempting to initiate a startup in the technology sector. Available risks cross both B2C and B2B vectors, and while the risk percentage can fluctuate between said vectors, it clearly illustrates the wide array of risks present for your technology startup. When these risks are combined with potential missteps by the founders of the technology startup, a perfect storm can be created that only terminates with the complete failure of the endeavor.
Building a startup company takes vision and great ideas. But before you can get up and running, it also requires legal understanding and planning. Startups need to go through steps to protect the owners and the organization. Before you start doing business, make sure you have worked through these preliminary steps.