Blog – Emerging Companies Insider

https://emergingcompanies.foxrothschild.com/

The Emerging Companies Insider Blog focuses on recent and developing areas of the law affecting startup and emerging growth companies and their investors, including choice of entity, shareholders’ agreements, issuance of equity to employees, preparing for and executing a capital raise, exit strategies and the JOBS Act and its impact on how companies can and should raise capital from investors.

Recent Blog Posts

  • ABA Panel Tackles Venture Investing in Cannabis Companies Venture capital is playing a growing role in the country’s emerging legal cannabis industry. Attorneys Emily J. Yukich and Matthew R. Kittay of Fox Rothschild’s Emerging Companies & Venture Capital Practice will conduct a panel discussion with industry insiders during the American Bar Association Business Law Section’s annual meeting in Chicago. The Angel Venture Capital Subcommittee, which Yukich and Kittay co-chair, will present an in-depth 360-degree examination of venture capital investing in cannabis companies, featuring: Panelists: Jeremy Unruh, general counsel and director of... More
  • The Difference Between Venture Capital and Private Equity (And How Star Wars and Star Trek Will Help You Remember Them). Quick quiz: If your startup is seeking investors, will you have more success with private equity or venture capital firms? How about when you’re looking to sell that company? The answers are (1) venture capital and (2) private equity.  If you weren’t sure, you’re not alone; the terms are often confused or used interchangeably.  However, PE and VC firms generally have very different investment strategies.  Understanding the distinctions may help save time and money and…perhaps…save face (i.e., not everyone will judge you for... More
  • Why Your Company Name Matters –The Right Name Accelerates Growth and Saves You Marketing Costs When Every Dollar Matters An abbreviated version of this article will appear in the American Bar Association’s Business Law Today, Fall 2017 Edition. Is your startup brand so strong that consumers tattoo the logo on their arm? Or so hard to pronounce that investors, vendors and customers are disinclined to do business with you? According to a study published in the peer-reviewed academic journal Venture Capital, your company name matters even more than you think.  The study, entitled “The Effect of Company Name Fluency on Venture... More
  • Minnesota’s New LLC Act Takes Full Effect on January 1 In an Alert published on Thursday, Andrea Ravich provides an update on changes to Minnesota corporate law regarding limited liability companies (LLCs) that will take effect in January 2018, and notes action items for companies to ensure compliance. Copyright: tashatuvango / 123RF Stock Photo An overhaul of Minnesota corporate law on limited liability companies, or LLCs, that was phased in over three years will take full effect in January 2018. The new act differs significantly from the old act, but is modeled after the Revised Uniform... More
  • Private Equity Firms Eye Medical and Dental Practices for Acquisition Debra L. Gruenstein writes: Private equity firms have recently been deploying capital to purchase medical and dental practices. The typical transaction would involve the purchase of multiple practices and the establishment of a management company. The physicians would be paid a multiple of earnings and receive some rollover equity in the management company. Although many states have had a prohibition on the corporate practice of medicine for years, recent cases in multiple jurisdictions have made the structuring of these transactions more complex... More
  • Committee on Foreign Investment in the U.S. (CFIUS) May Expand Scrutiny of Cross-Border Transactions Barbara P. Alonso writes: The Committee on Foreign Investment in the United States (CFIUS), an inter-agency committee led by the U.S. Treasury Department that reviews foreign direct investment transactions, is likely to be applied in a more stringent manner by the Trump Administration. Members of Congress and of the Trump administration have advocated for enhanced CFIUS reviews of transactions that involve the change of control of U.S. companies (or foreign companies with U.S. assets) to foreign interests. Since its creation in 1988,... More
  • Curing Corporate Missteps Under Delaware Corporate Law The Problem As every founder knows, starting and scaling a company is an extremely difficult and multi-faceted undertaking. In addition to the primary goals of developing a viable product, finding (and in some cases building from scratch) a robust market, and raising the capital necessary to sustain their business and operations, founders and their core teams also grapple with the day-to-day management and operations of a growing enterprise, whether that be personnel issues, forecasting cash needs and burn rates or tackling the legal... More
  • Tax Implications of Your Stock Options Ethan Zook and Jacob Oksman write: Attracting and retaining high-performing employees is critical to the success of any emerging company. A key ingredient to securing the right talent base is an attractive and aligned remuneration plan. Most emerging companies will structure their remuneration plan leveraging three key elements: a competitive base salary, a short-term bonus plan, and a long-term incentive plan (LTI) that typically comes in the form of a stock option plan. The base salary and bonus plan are typically structured... More
  • Trump Administration Delays Regulations To Fast-Track Startups The Trump administration recently announced it is delaying – and likely rescinding – the Obama-era International Entrepreneur Rule (the “Rule”). The Rule was slated to go into effect on July 17, 2017. It would have made it easier for foreign entrepreneurs to establish startup companies in the U.S. We blogged in detail on the final Rule when it was published in early 2017. Now the Rule’s effective date has been delayed until March 14, 2018; however, implementation seems highly unlikely: the... More
  • Philadelphia Ranked Fifth in List of U.S. Life Science Clusters A study of interest for those in the Philadelphia region has recently been released. Copyright: sepavo / 123RF Stock Photo Rising two spots from last year, Philadelphia has been ranked fifth on the list of life science clusters in the United States recently published by professional services and research firm JLL.  Following Boston, San Francisco, San Diego and Raleigh-Durham, Philadelphia was cited as the leader in the “Breakout Cluster”, which are regions “making strides in life sciences through new development and a growing... More