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Course Descriptions

As of 5/28/2020 4:57:37 AM

Startups: Law & Business

The startup sector is generally thought to be the most dynamic and innovative segment of the economy and one crucial to growth and development. This seminar provides a deeper understanding of the legal and business considerations -- including theoretical, empirical and practical -- within the startup sector for those wishing to work in a startup and for those wishing to advise them. We begin with an overview of the role of the startup sector in the US economy, its history and key moments, and how it compares to startup sectors elsewhere. We then explore the critical legal, financial, and business considerations that populate the Startup space. These include contractual issues, entity formation, structure of Venture Capital (VC) Funds and other early stage investors, tax considerations and other regulatory issues (e.g., Dodd-Frank, Investment Company Act) that have a substantial impact on the sector. This will include readings focused on actual startups and their structure. Our discussion then moves to examining sources of capital, the "pitch" deck and "pitch" meeting and how the VC firms actually operate and make decisions. We then address issues critical to the business value of the firm -- financing, launch plans, intellectual property rights valuations, and stock and option compensation to name a few. We then dive into the "exit" question -- what considerations are relevant to the timing and structure of an exit. For example, when are strategic acquisitions preferred and when are Initial Public Offerings (IPOs) and what roles do the law, strategic considerations and global capital flows play in this? Finally, we spend some time examining the growth of certain startups such as Google, Facebook and potential IPOs in the legal services space (such as Axiom). Throughout the class, the readings will involve a mix of academic and practice-oriented pieces and we will highlight differences in startup sectors around the world. Some sessions will involve guest lecturers. Assessment for the seminar will depend on completing a project involving bringing together an idea for a startup, along with legal documentation and negotiation, and "pitching" it to a panel of experts (ala "Shark Tank") and on class participation.