A startup is the culmination of an idea and the effort to bring
it to reality. Considering the time and effort the founding members have
invested into it, it is essential to protect the startup legally before expanding.
There are many legalities that affect and can safeguard a startup, and the
legal system can be used to create a safety net for growing startups to ensure
that during their growth, no legal infractions can create a hassle.
Although to bring an idea to life, one needs a concrete idea and plan to
implement it. The plan must include protecting the brand that one is trying to
create. Sometimes, many founders undermine the power of protecting their
startup. Some essential ways to do so are as follows:
Register your company
It is very important to figure out the type of company the startup will be and register it accordingly. There are various types of companies such as Private Limited Company, Company Limited by Shares, Company Limited by Guarantee, Unlimited Company, One Person Company, Limited etc. It is important to register the company as one cannot own or be a part of a company that does not exist legally. Also, one cannot conduct business on an unregistered company.
Trademark registration
As the startup is going to have a certain identity identifiable
by a logo, it is important to ensure the founders have the sole rights to it
and it cannot be used by any other startups or companies. This creates a unique
identity for the startup which the consumers will associate back to the startup
and its services. Today, where Google disrupted the market by creating its own
unique space the search engine market, people associate searching or finding
any information online with Googling. Thus the term “Google it” emerged. This
disruptive pattern is something all startups aim for.
It is a unique design that differentiates the goods and services from other
brands. Thus, it is very important to register your trademark under the
Trademark Act.
Establish a Privacy Policy
This is essential if the business has an online presence. A privacy policy
is of extreme importance
You see it’s easy, you don’t need to worry about your brand name after taking the protection measures. You love your company and Its obvious that you won’t take any risk before even establishment of your company into a big platform.
Founder’s Agreement
If the startup is co-founded by more than one founder, it is advisable to
have a Founder’s Agreement between them to outline the variants and functions
between them. As it is always said, put it in writing. This is a good Manner of
safeguarding the founders vested interest.
Licenses and Permits
Starting off, one must retain all the licenses and permits needed for the
startup to function as a business and prosper. This is essential as it lawfully
allows the company to conduct their business in each other
Labour Laws
Adhering to labour laws is an integral part of every
organisation. Hiring and growing the team is part of any growth plan for a startup.
Laws with regards to provident fund, gratuity, weekly holiday, maternity
benefits, sexual harassment, payment of bonus etc. The startups registered
under the Startup India Initiative can complete a self declaration for nine
labour laws from the date of incorporation to be exempted from labour inspection.
Contract Management
Contracts are at the centre of a startup or any company. Basic knowledge of
contract management is good to have for any founder as one must know the ins
and out of what amounts to a contract as per the Indian Contract Act, 1872.
Starting up with a legal stronghold is a formula for success and growth. Having
your legal handled will provide
founders a clean slate to truly focus on their idea and bring it to life.
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