Matters to Be Considered During Establishing a Startup Relationship 3 July 2017

Due to technological developments, software development has become one of the fastest growing business areas throughout the world. In order to become successful in this field, there should be cooperation between software developers and investors as software developers need investors to be supported financially and investors need software developers who have significant ideas; and this cooperation leads parties to establish a startup relationship. However, it is very important to regulate the startup relationship in detail, since if necessary issues are not clearly identified before the commencement of the mentioned relationship, parties would face with serious problems on protecting their rights, after being successful in software development business.

Firstly, the parties should create a separate legal entity, a company, under which the business shall be operated. Additionally, the parties should choose the correct type of cooperation as the liabilities and responsibilities of the parties change in accordance with the type of the company. Besides, to be protected from outside risks and to minimize the inside disputes, a shareholders agreement should be concluded between the parties. With this respect, the roles of the parties could be determined, in addition to significant provisions on transfer of shares, process of taking decisions, confidentiality, non-compete undertakings and penalty clauses which may protect the rights of the parties in case of infringement of the contract.

As the main activity of such a business would be developing software, the intellectual property rights should also be regulated in detail. Drafting an agreement on the intellectual property rights would ensure that the possible patents, trademarks or copyrights could not be stolen; since otherwise would cause financial damage of the company.

Additionally, in order to have a well-established startup relationship, parties should be consulted by the experts on not only corporate and intellectual property law, but also tax law and specific laws and regulations which would govern the software development business. Therefore, in order not to face with any problems, it is very important for the parties to have from professionals who have extensive expertise in startup companies.

Türkçe Versiyonu İçin

http://www.kasaroglu.av.tr/tr/31223/Startup-Iliskisi-Kurulurken-Dikkat-Edilmesi-Gereken-Hususlar

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