Allens Accelerate

Investors

We advise investors on all aspects of law concerning their investment into promising startups, including the establishment of a fund or vehicle, capital raising, debt financing and ultimately realisation of the investment through exit

Services and pricing

We understand that the needs of startups are different to those of major corporates and we tailor our offering for investors to reflect the scale, complexity and speed of startup investments.

Our services for investors cover the lifetime of the investment from the establishment of vehicles, investment of funds and following the investment through to exit.

We are well versed in venture capital style investments and we have extensive experience assisting clients to take minority stakes in businesses – we have one of the leading M&A teams in Australia and we understand the unique nature of joint ventures with, and investments in, entrepreneurial and high-growth businesses.

We understand the emerging, high-growth market – Allens is the only big law firm in Australia to have built an internal team and practice specifically targeted to this market. We are also the only law firm to be a foundation member of Stone and Chalk Fintech hub in Sydney.

Startup offering

Access our A-Suite

View the brochure

How we can help

Access to our network

We leverage our extensive network to connect you with our portfolio of leading high-growth emerging company clients and other business leaders.

We provide access to our international network through our alliance with Linklaters and we act as one firm to support ambitions to expand to overseas markets.

We also provide access to our program of client events, a seat at the table at luncheons for your sector’s most influential people, introductions with senior business leaders and policy makers, and profiling opportunities in white papers and at conferences.

Setting up your investment vehicle

Have you considered how you will be making your investment? Our team can assist you to decide which investment model is going to work for you, and to establish your fund or investment vehicle (including VCLPs & ESVCLPs) to ensure that you have the best opportunity to achieve your investment goals.

Due diligence

Although anyone thinking about investing in a startup is likely to have a reasonable appetite for risk, investors are unlikely to want to commit their money to a startup that has unnecessary legal risk – that is, risk that exposes a startup to disputes down the track, whether in relation to the ownership of the business or its assets (including core intellectual property), or the manner in which the business conducts its operations. Most investors will therefore conduct some due diligence before they commit to funding a startup. Our team can help you to conduct the necessary legal due diligence in a manner appropriate to the nature of the startup and your proposed investment.

Structuring your investment

We recognise that investments into this sector are not about immediate returns but rather about embarking on a journey to grow and explore future opportunities. We have extensive experience advising on joint venture and minority stake investments in entrepreneurial businesses. Our understanding of the commercial and strategic drivers of high growth companies means that we can help you to structure these sort of deals and manage your assets going forward.

Speak to us about the best way to protect your investment without stifling the subject of your investment, including by considering investor protection provisions typical of venture capital style minority investments in high-growth companies, such as:

  • anti-dilution protections for future fundraisings (e.g. rights to participate, pre-emptive rights and protection against ‘down round’ dilution)
  • ‘pay-to-play’ requirements for future fundraisings
  • preference rights on liquidation or investor exit (and in particular the consequences if any of the other investors exit)
  • conversion rights (including ensuring conversion rights align with those of the other investors)
  • drag and tag rights (including, importantly, whether there is a mandatory drag for shareholders below a certain percentage holding).

Tax

There are many tax and regulatory measures designed to encourage greater investment in startups, including tax incentives, capital gains tax exemptions and tax arrangements for ESVCLPs and VCLPs. Speak to our team about the tax incentives that might be available to you.

People

As a fund or investor investing money into a startup, you want to make sure that the startup founders are locked into the business and run the business in a way that aligns with your strategy. It’s also important that the startup has been set up in a way that allows it to attract and maintain the people it needs to take it to the next level.

Protecting your IP

Intellectual property is the lifeblood of any new business or startup. Before you invest, you want to make sure that the IP has been adequately protected. What other pitfalls and issues do you need to be aware of?

Data management and privacy

Breaches of data protection and privacy failures can destroy the reputation of an emerging company. As an investor, how can you ensure that the startup has the correct protection in place?

Watch the video

Head office and governance

As an investor, what is your liability for corporate governance issues at the startup?

Visit our Head Office & Governance page.

Data management and privacy

Cyber and startups

Dr Nimrod Koslovski is a partner at JVP Cyber Labs, a leading Israeli VC focusing on cyber and big data investments. Valeska Bloch caught up with Dr Koslovski about all things cyber and his insights for a successful startup economy.