Startups & Open Innovation

It is vital in the entrepreneurial ecosystem to have detailed knowledge of the legal issues faced by startups. With a view to providing quick and practical solutions to these challenges, the professionals from Garrigues Startups&Open Innovation have created a series of videos, called Startup Chats, offering information on key legal issues for entrepreneurs in a Q&A format.
In view of the ever-growing movement of innovative economic activities, the Securities Commission – Comissão de Valores Mobiliários (“CVM”) edited in July 2017 the CVM Instruction no. 588 (“IN 588”) to regulate the public fund raising by small-sized business companies. According to the IN 588, the relationship between investors and takers occurs through an electronic platform of participative investment, responsible for the offer and distribution of the securities issued by the taker companies.
Regulations have not managed to effectively keep up with the rapid development of technology. This disparity in the rate at which both have changed, has given rise to a number of legal questions that require a global approach to their new realities, and a response that cuts across all areas of law (corporate and commercial, labor, tax, administrative, data protection or intellectual property law). This fact was made abundantly clear in the 1st Garrigues Digital Forum, held at the firm's Madrid offices on 14 June.
One of the most common mistakes made when investing in a technology startup is to ignore potential intellectual property contingencies. This mistake can prove to be particularly serious when the value of the startup lies precisely in its intangible assets. Think of things like Google’s search algorithm, Amazon’s patented 1-Click ordering – the list is endless.
One of the challenges a business association faces in the early stages of its creation and development is how to attract and retain high-potential employees, known as “key people,” in today’s strikingly competitive labor market. This is particularly difficult for those recently-launched endeavors on a tight budget.
In general, the terms “accelerator” and “incubator” are used synonymously, although they refer to different concepts with distinct purposes and processes. In order to be able to understand how an incubator or accelerator can contribute to the growth, development or promotion of a startup, we need first to determine and distinguish both notions, by detailing their most important aspects and then listing guideline which we consider useful when it comes to cherry-picking between these.