entrepreneurial ecosystem and legal fundamentals - entrepreneurship 101 (2012/2013)
DESCRIPTION
Overview of the legal and tax considerations of starting a business including how to register and structure your business. Emphasis on the importance of understanding the entire “ecosystem” of your business, including corporate organization, intellectual property, contracts and more. Watch the lecture video: https://vimeo.com/51247514TRANSCRIPT
ENT 101 – MaRS Discovery District Wednesday October 10, 2012
ARSHIA TABRIZI
B.A.Sc. Computer Engineering (Hon) (UofT)
Juris Doctor (Law) (UofT) Member of Ontario & California Bars
www.tabrizilaw.com
¡ 1990-‐1995 – UofT software/hardware engineering, IBM ¡ 1995-‐1998 – joined the “dark side” – UofT law school ¡ 1998 – back to “the force” – thesis on “University Spin-‐offs” ¡ 1999-‐2001 – Wilson Sonsini Goodrich & Rosati PC (Palo Alto,
Silicon Valley) – incorporated Google, IPO’d Apple, 800+ lawyers ¡ 2002 – Tabrizi Law Office -‐ full-‐service/exclusive start-‐up practice
§ Incorporation, Financing, IP, Trademark, Patents, Licensing, Web § Strategic Partner – equity, relationships, 3-‐4/year time horizon
¡ Client list § NeXJ Systems (founded by William Tatham, previously founder of
Janna Systems, acquired by Siebel for $1.7 b.) § RedFlagDeals.com (acquired by Yellow Pages Group) § WedSnap Inc. (acquired by The Knot Inc.) § MMB Research (smart-‐energy platform, $1 m. angel round) § CognoVision (acquired by Intel)
3 Copyright 2012 Tabrizi Law Office PC
1. Corporate Organization § Do it right from start
2. Intellectual Property § More than just patents
3. Contracts § Why do they matter
4 Copyright 2012 Tabrizi Law Office PC
¡ Articles of Incorporation Ø Limited liability Ø Tax advantages Ø IP centralization Ø Venture capital Ø Range $750 (basic) – $1,500 (full) Ø Timing -‐ when to incorporate?
Ø Tip #1 – In corporate work, scrooge pays later
5 Copyright 2012 Tabrizi Law Office PC
¡ Corporate Structure § Founder Shares
Ø Ownership %
Ø Voting rights Ø Share classes
¡ Corporate Governance § Board, officers
¡ Tip #2 – Shareholders agreement = prenup
6 Copyright 2012 Tabrizi Law Office PC
¡ Customized contract § Spectrum of complexity: 5 – 80 pages § Pre-‐venture versus venture-‐ready
¡ Broad range of issues § Corporate Governance
Ø Board, decision-‐making
Ø Hire, finance, sell
§ Shareholder Exit ▪ Divorce, sale of company
Copyright 2012 Tabrizi Law Office PC 7
¡ Billions of dollars are at stake: § Apple v. Samsung (Android OS) § Heated auction for Nortel patents § i4i $240 m. award against Microsoft § Winkelvoss twins against Facebook
¡ IP = protecting your primary assets
Copyright 2012 Tabrizi Law Office PC 8
¡ Steve Jobs had dozens of patents § Stair design patent in Apple stores
¡ Apple lost GUI case against Windows ¡ Steve Jobs negotiated music rights for iTunes ¡ Steve Jobs was secretive & controlling
§ Contrast lean start-‐up practice ¡ iPhone trademark in Canada ¡ Tip #3 – IP is not only about patents
Copyright 2012 Tabrizi Law Office PC 9
¡ Patents v Innovation § Patents equal innovation § Patents kill innovation
¡ Questions ▪ How much innovation could Google have produced if it had spent $12b on product development instead of the purchase of Motorola’s mobile-‐related patents? ▪ Is Apple stopping Android phones good for innovation?
Copyright 2012 Tabrizi Law Office PC 10
¡ Patents § $10-‐15k full patent § $2-‐4k provisional patent § Prosecution, enforcement
¡ Trademarks § $1-‐2k to registration § 6-‐18 months to registration § Improper use/application => lose rights
¡ Tip #4 – digital media is about brand
11 Copyright 2012 Tabrizi Law Office PC
¡ Trade Secret v. Patents § Easy, cheap § No time limit § No disclosure
¡ IP Strategy ¡ NDA (Contract)
§ Watch for traps! ¡ Tip #5 – NDA’s should be mutual
12 Copyright 2012 Tabrizi Law Office PC
¡ Legally Binding Agreement § Customers ▪ License Agreements
§ Contractors ▪ Consulting /Development Agreements
§ Employees ▪ Employment Agreements
§ Founders ▪ Shareholders Agreement
¡ Emails / LOI’s / MOU’s ▪ Enforceable, IP, risks
13 Copyright 2012 Tabrizi Law Office PC
1. Protect IP 2. In writing 3. Raise money 4. Sell company 5. Manage risk
¡ TLO – strategic partners to start-‐ups
14 Copyright 2012 Tabrizi Law Office PC
¡ Tabrizi Law Office P.C. ▪ Incorporations, Shareholder Agreements ▪ Stock Options, Founder Agreements ▪ Venture Capital Financings, Acquisitions ▪ Intellectual Property Law (IP, Litigation) ▪ Technology Transactions (Licensing, Partnerships)
§ Contact: ▪ [email protected] ▪ arshia_tabrizi ▪ 416.510.2600 x.306
15 Copyright 2012 Tabrizi Law Office PC