Blog / Start- Ups

Comments and Insights on the Capital Structure of Startup Companies

July 29, 2021 / by Ken Shaked

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.

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A Good Start for A Successful Exit

June 9, 2021 / by Ken Shaked

Entrepreneurs? Launching a start-up? The first question you should ask yourself is what is your exit strategy. If you do not know the answer, you should stop and make a plan, because your exit strategy is your company’s success plan.

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Startups: How Much Is Your Invention Worth

May 23, 2021 / by Ken Shaked

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.

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Can You Really Find a Sample Founders’ Agreement on the Web?

January 28, 2021 / by Yuval Lazi

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.

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Using Open Source in Your Business? Beware the Fine Print

August 11, 2020 / by Barnea

Open source code is written by developers and for developers. The concept behind open source is to allow access to many developers and promote collaboration between them.

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What Employees Need to Know About Stock Options

August 2, 2020 / by Yuval Lazi

In a short video, Adv. Yuval Lazi explains the guiding principles in granting options, how you can estimate how much the options are worth, and what is important for an employee to know when he receives options.

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Startup Funding in the Coronavirus Era

April 30, 2020 / by Barnea

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.

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Protect Your Business by Learning How to Handle Data

March 4, 2020 / by Anat Even-Chen , Karin Kashi

In an attempt to assist businesses in addressing the privacy challenges they face, we prepared a short guide on the key principles of handling data.

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What Is a Non-Disclosure Agreement and Is It Really Necessary?

February 20, 2020 / by Yuval Lazi

This video deals with the questions of when to sign an NDA and how much protection it really gives.

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Looking for a Venture Capital Fund to Invest in You? Here’s How to Do It Right

January 20, 2020 / by Barnea

Raising capital is one of the main issues that preoccupies entrepreneurs on a daily basis. Continue reading to learn how to choose the venture capital fund best suited for your project.

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How Israel Became a Leader in the FoodTech Industry?

January 6, 2020 / by Daniel Lorber

In Israel, over 200 startups and companies are at the forefront of innovation in the FoodTech field. Watch the video to learn more about the leading trends in the FoodTech sector .

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Good Night 2019!

December 31, 2019 / by Ariella Dreyfuss

Check out some interesting developments in the Israeli high-tech sphere in 2019.

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Seven Investment Terms Every Entrepreneur Should Know

November 20, 2019 / by Yuval Lazi

Below are some important terms every entrepreneur should know before undertaking his or her first investment round.

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Innovation Authority Grants – What to Know in Advance?

October 23, 2019 / by Anat Even-Chen

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.

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Raising Early Stage Financing for Your Start-Up? The Do’s and Don’ts You Must Know

July 24, 2019 / by Itay Gura

Raising financing is tricky, stressful and for many involves navigating uncharted waters. Click to read for useful information to help you sidestep certain unhealthy choices.

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2019 Opportunities in the Israeli Market

July 17, 2019 / by Michael Barnea

In 2019, Israel remains “the Start-Up Nation” and a leader of technological innovation. Thanks to its strong currency, active economy, and robust export industries, it also continues to attract noteworthy international investments.

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The French Paradox

June 24, 2019 / by Samuel Henri Samuel

In contrast to Britain and Germany, France does not appear as one of the leading investor countries in the Israeli economy. Adv. Samuel Henry Samuel outlines the situation.

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2019: The Rise of Femtech

April 29, 2019 / by Ariella Dreyfuss

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.

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Protection of Intellectual Property

February 4, 2019 / by Daniel Lorber

Many startups fail to adequately safeguard their most important asset – their intellectual property. Click to read some fundamental steps that tech companies can take in order to protect their products and inventions.

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Blockchain Now and Into the Future – What We Can Expect

January 9, 2019 / by Zvi Gabbay

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.

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What You Always Wanted to Know About Fintech Regulation, But Were Afraid to Ask…

December 31, 2018 / by Zvi Gabbay

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.

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Doctor, Can I Get a Prescription for Blockchain?

December 16, 2018 / by Barnea

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.

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How to Negotiate with a Prospective Angel Investor

November 15, 2018 / by Yuval Lazi

How you negotiate with an angel investor goes a long way in determining whether you will receive funding or not. Click to read some top tips for negotiating with a potential angel investor.

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Entrepreneurs, Pay Attention Now or Pay Later

November 4, 2018 / by Harel Perlmutter

It is vital that entrepreneurs pay attention to possible tax benefits and tax liabilities from a startup’s earliest stages. Click to read the four things you should pay particular attention to.

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Warranty & Indemnity (W&I) Insurance – It’s All in the Name

October 25, 2018 / by Ariella Dreyfuss

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.

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2018 Opportunities in the Israeli Market

July 12, 2018 / by Michael Barnea

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.

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PropTech – Transformation of the Real Estate Market

June 21, 2018 / by Barnea

Major, long-established players in the real estate market have joined forces with young companies and entrepreneurs with the objective of resolving the many challenges inherent in the field of real estate transactions.

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Smart City – Israel’s Innovative Technologies

February 11, 2018 / by Barnea

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.

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Follow these strategic steps in planning your company’s exit

January 31, 2018 / by Yuval Lazi

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.

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Legal Documents Every Startup Needs

January 21, 2018 / by Barnea

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.

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Israel’s International Innovative Edge in Robotics Technology

January 10, 2018 / by Itay Gura

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.

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Goodnight 2017…

December 31, 2017 / by Ariella Dreyfuss

It has certainly been an interesting 2017 in the Israeli Hi-Tech world, here is a rundown of 5 highlights, in case you missed them.

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Sports Tech – When Sports Join Up with Technological Innovation

December 24, 2017 / by Barnea

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.

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Glossary for Beginners in the World of Digital Currency

November 30, 2017 / by Karin Kashi

Do you keep hearing people talk about blockchain, bitcoins, and ICOs with no idea what they mean? – Here’s a short glossary to help you understand what the fuss is all about.

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Israel’s Successful Incubators and Accelerators Develop the Future

November 19, 2017 / by Daniel Lorber

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.

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Developing Marketing Strategy for Potential Investors

October 16, 2017 / by Yuval Lazi

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.

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Deliver a Strong Value Proposition to Raise Funds Effectively

September 7, 2017 / by Yuval Lazi

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.

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How Tech Transfer Organizations Drive Israel’s Growth

July 30, 2017 / by Yuval Lazi

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.

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Local Cybersecurity for a Connected World

July 13, 2017 / by Yuval Lazi

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.

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Israel’s New Opportunity in Renewable Energy

July 2, 2017 / by Barnea

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.

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The Life Science Industry in Israel

June 12, 2017 / by Yuval Lazi

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.

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Protecting Your Start-Up with Company Registration in Israel

May 11, 2017 / by Barnea

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.

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Preparing for the Second Round of Startup Funding

April 6, 2017 / by Michael Barnea

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.

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Forces That Drive Innovative Countries – The Israeli Example

March 27, 2017 / by Itay Gura

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.

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Carve-out Plans for Company Employees

March 8, 2017 / by Daniel Lorber

One of the common remuneration mechanisms in startups and technology companies is the granting of options to employees in addition to or, sometimes, in lieu of, the traditional remuneration component – the cash salary.

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Japan-Israel Relations: Advancing Technology

February 16, 2017 / by Simon Jaffa

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.

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Do NDAs Really Protect Startups?

January 15, 2017 / by Daniel Lorber

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.

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8 Things that Happened in the Israeli Hi-Tech World in 2016

January 4, 2017 / by Ariella Dreyfuss

It has been an interesting 2016 in the Israeli Hi-Tech world, here is a rundown of 8 things that happened, in case you missed them.

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Crowdfunding: Funding Companies in the Startup Nation

November 30, 2016 / by Daniel Lorber

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.

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The High-Tech Sector in Israel in the Year Ahead

August 22, 2016 / by Yuval Lazi

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.

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Agtech: Why Israel Makes Sense

July 31, 2016 / by Barnea

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.

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Things You Need to Know About Fintech

July 17, 2016 / by Michael Barnea

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.

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4 Things Every Startup Entrepreneur Should Know

June 29, 2016 / by Yuval Lazi

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.

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Top 10 Mistakes Founders Make

May 24, 2016 / by Yuval Lazi

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.

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K.I.S.S

May 16, 2016 / by Ariella Dreyfuss

Keep. It. Simple. (Stupid). Entrepreneurs, you are creative and innovative, but when raising financing it is ok to follow the norm. There is no need to try and reinvent the wheel. Standard also works. I would even argue that from an investment perspective it is superior.

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Must-Have Legal Checklist for Startups

April 5, 2016 / by Simon Jaffa

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.

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