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Investor and serial entrepreneur Jonathan Sposato has seen enough startup pitches in his day to know what he likes. In this Geekwire post from earlier this year, he shares his three favorite things to hear from founders seeking an investment. One key piece of advice from Joanathan that is simple and straightforward: your investors want to know their money is going to be put to good use.

With that in mind, he advises founders to “speak provocatively and ambitiously about their concept,” to share names of other well-respected investors who…
Continue Reading Pitching Angel Investors: Advice from Jonathan Sposato

Compliments of Jason Smith of Kidder Mathews, attached is a Seattle-area office real estate market review for Q1 2013. As the report notes, the first quarter included a quiet encore of the performance seen near the end of 2012. Leasing activity was modest, but positive, tenants showed renewed interest in the middle of the Seattle central business district (CBD), Amazon leased any large space that came available in the CBD, and investors continued to be bullish on the Seattle office market.

The performance of the office market is especially…

Continue Reading Seattle Office Real Estate Market Review for Q1 2013

Choosing the best type of entity for a company can be a challenge.  C corporations are the norm for most emerging growth businesses, particularly those raising money from investors.  However, LLCs are becoming more widespread, even for operating businesses.  Founders may want to have the tax benefits of LLCs, which are not subject to a company-level tax (as is the case with C corporations) and may enable more tax deductions.

This potential for tax savings does not, however, come without a cost.  LLCs tend to be more complicated and expensive to setup and manage, particularly for operating businesses.  LLCs can become even more tricky for businesses that want to issue equity to incentivize employees or other service providers.  This article addresses some of the ways LLCs can use equity to incentivize service providers, and the implications of each option (pardon the pun).Continue Reading Options for Issuing Employee Equity in LLCs

pic-trent.jpgCONTRIBUTED BY
Trent Dykes
trent.dykes@dlapiper.com

The Angel Resource Institute, Silicon Valley Bank and CB Insights recently released their angel group update 2012 year in review, the Halo Report. The Halo Report analyzes angel investment activity and trends in the United States. Here are a couple interesting 2012 highlights:

  • The median angel round size was $600K;
  • The median angel round size was $1.5M when angel groups co-invest with other types of investors;
  • The median pre-money valuation for early stage angel group deals was $2.5M;
  • 63% of angel group deals were in

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Continue Reading Angel investment trends; 2012 year in review

If you are reading this post, then you probably share my belief that one of the best things our government can do to spur economic and job growth is to support the startup community. In recent years, government entities ranging from state (See Maryland’s proposed tax credit to support investment in cybersecurity industry) to federal (See JOBS Act: What matters most for startups and VCs) to the IRS (See Fiscal Cliff Bill to renew 100% QSBS tax break) have enacted programs designed to enable more and easier investments into startup companies (in the US). However, many commentators have argued that such efforts are not enough.

One country that appears dedicated to its startup community, and that has a very interesting and seemingly effective model for facilitating growth, is Israel. Last week I met with Daniel Marcus of the Israeli law firm Amit, Pollak, Matalon & Co. to discuss emerging growth and venture capital markets and I took the opportunity to ask Daniel more about Israel’s government funding model via its Office of the Chief Scientist (OCS). Luckily, Daniel and his colleague, May-ad Katz, had previously written a great article titled “Exporting technology from the ‘start-up’ nation” summarizing the OCS funding system and related encumbrances.Continue Reading Facilitating startup growth: Overview of Israel’s OSC funding

On March 12, 2013, the Federal Trade Commission issued its long-awaited update to its 2000 guidance on disclosures in online marketing and advertising.

The guidance, entitled .com Disclosures: How to Make Effective Disclosures in Digital Advertising, not only reaffirms many of the FTC’s longstanding principles for effective online disclosures, but also provides guidance as to how those principles will be applied to new technologies that have emerged since 2000, such as mobile phones and tablets with more limited space, banner ads and multimedia messaging, and social media platforms such as Facebook and Twitter.

The FTC has broad powers under Section 5 of the FTC Act to protect consumers from “unfair and deceptive acts or practices.”i Under the FTC Act, the FTC has long required effective disclosures for claims that would otherwise be deceptive or misleading without them. .com Disclosures is designed to help businesses comply with the FTC Act by providing examples and direction on how to avoid unfair and deceptive practices through appropriate disclosures in their online and mobile marketing.ii

Although the new guidelines do not carry the force of law, they provide insight into how the FTC will apply the FTC Act to online and mobile marketing disclosures. Advertisers and marketers are well advised to review and potentially modify their existing and future online advertising to ensure they are complaint with these guidelines.Continue Reading FTC Issues New Guidance for Advertising and Marketing in the Online and Mobile World

pic-trent.jpgCONTRIBUTED BY
Trent Dykes
trent.dykes@dlapiper.com

A great reminder compliments of our colleague Mark Radcliffe: On March 16, the US patent system will undergo a fundamental change from the current “first to invent” to a “first to file” system.

By way of quick background, a “first to invent” system means that even if another party files a patent application on your invention first in the US Patent and Trademark Office, you will still be entitled to obtain a patent on your invention if you can prove you created the invention first. The new “first to file” system, which becomes effective on March 16, 2012, provides that you can no longer get a patent by proving that you actually created the invention before the filing date of the first patent application.

Patents have become an increasingly important part of the assets of startups, especially since most startups exit through merger. PwC, in its recent report on US technology M&A, explains that “companies with strong patent portfolios continue to be likely targets for future acquisitions, as modern competitive pressures force businesses to acquire and defend intellectual property rights.”Continue Reading Major Patent System Change Effective March 16, 2013: First to File

Asher Headshot - Resized.pngCONTRIBUTED BY
Asher Bearman
asher.bearman@dlapiper.com

 

 

The Startup Company Starter Kit, available in our “Forms” section in the right hand column, provides forms to do any of the following: 

  • Create an offer letter for a prospective employee (state specific and will address confidentiality obligations)
  • Create an agreement that an existing or new employee will sign that protects and preserves the employer’s proprietary information and inventions (often called PIAAs, these are critical for employees involved with company IP)
  • Disclose confidential information TO someone else (for disclosures BY the company) 

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Continue Reading Startup Company Form Agreements

Compliments of Jason Smith of Kidder Mathews, attached is a Seattle-area office real estate market review for Q4 2012. As the report notes, the region’s office market continues its gradual overall recovery. Leasing was widespread, with all five submarkets reporting positive results for the first time in a year. The positive impacts of Amazon in the north end of the Seattle central business district (CBD) and various gaming and internet companies in the Bellevue CBD continued through the fourth quarter, joined by renewed leasing from more traditional sectors. The most recent beneficiary was the overall Class A category, which saw increased leasing activity in the fourth quarter in legacy Class A buildings such as Columbia Center, Safeco Plaza and 901 Fifth.Continue Reading Seattle Office Real Estate Market Review for Q4 2012

Today the Angel Resource Institute, Silicon Valley Bank and CB Insights released their angel group update for Q3 2012, the Halo Report. The Halo Report analyzes angel investment activity and trends in the United States. Here are a couple interesting highlights:

  • The median angel round size was $640K;
  • The median angel round size was $1.59M when angel groups co-invest with other types of investors;
  • The median pre-money valuation for early stage angel group deals was $2.6M;
  • California was the most active region for angel deals, both in number

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Continue Reading Angel investment trends for Q3 2012