India has been considered as world’s largest and fastest growing startup ecosystem. The government has taken good efforts in last couple of years and has launched many initiatives such as Make in India, Start-up India, etc. to promote the manufacturing and innovations. These initiatives have facilitated a growth in infrastructure as well as treated a fair amount of excitement amongst the talented Indians.

Nurturing a new business includes plenty of things in your bucket. First, have a definite, clear, practical and ideal goal, as well as an objective. Second, have a necessary means to achieve the ends, wisdom, money, materials and methods. Third, adjust all your means to that end. Knowing basics of the startup laws is one of the stepping stone to this journey. It starts at the very beginning and only escalates as their startup grows and moves towards an exit. Before diving into a deep sea of legal issues, it is important for any startup to look at the vital startup laws prior starting the journey. Many entrepreneurs vastly underestimate how much help they’ll need from a lawyer.

Once an idea hits your mind, you should opt for protection. At the core of many new startups is an innovative idea or invention. Needless to say, protecting the heart of your business is essential. If you're doing anything new with technology, codes, designs or research, intellectual property (IP) is with you. And so, it is important to consult for protecting your IP and brand identity.

In addition to developing the core product, it is crucial for you to take into consideration the legal facets involved in each stage of product life cycle. As most of the startups would not have an in-house counsel to guide, and so it becomes more important to be aware of legal issues involved. In a nut shell, to insulate a startup from liability, in a cost-effective manner it is important to take legal consultation. Some of the most important matters which require consultation with the lawyers are highlighted below.

To begin with, before pulling up a startup knows what kind of organization you want to set up i.e.to choose a business type.

One can incorporate it as a Partnership or Limited Liability Partnership (LLP) or One Person Company (OPC) or some thing else depending upon the type of business and funding required. Choosing the type will also depend on the long-term goals and vision of the entrepreneur. Every type has a separate set of legal obligations,and one must decide keeping the existing legal frameworks in mind. Fundraising is crucial for the success of any business activity. Funding is one of the important activities where legal assistance plays a vital role. There are various stages of fundraising which includes angel funding, seed round funding, growth/early stage funding. Once a startup company gets support and choose a way for funding, another important exercise investor would need legal due diligence where risks associated with the investment and a risk mitigation plan are identified.

Once a startup is insulated, it is a need for formulation of certain basic documentation which ensures that business can be carried out.

Most startups spend a lot of time developing their business and tend to neglect various legal and regulatory compliances. The importance of a legal diligence cannot be underestimated. Given the above it is important for startups to put their house in order before commencing fundraising initiatives. It is vitally important to understand your tax obligations also while starting any business, including effective record-keeping and deductions. The taxation policies implemented by the Government of India for startups underwent a drastic change with the Union Budget of 2016-2017. These changes, made under the ‘Startup India’ Policy, are touted to result in many concessions and exemptions.

We all are living in a technologically advanced era where things like e-Contracts, cloud computing, digital signatures, securing confidential data from hackers, cloud computing, protecting your privacy are not only very common but extremely important too. Knowledge of IT laws and E-commerce will help in exploring these avenues and thus, growing your business. Once a startup is insulated, it is a need for formulation of certain basic documentation which ensures that business can be carried out. To carry out business with third parties, a standard confidentiality and non-disclosure agreement template must be ready. This can be used by the startup to enter preliminary discussions with third party vendors, consultants, contractors etc. whilst ensuring that appropriate protection is provided to the startup and its ideas.

Depending on the nature of your startup, you might be subject to any number of regulations that affect your business. It is important to understand the labor laws, environmental laws and such other commercial and economical laws which are the areas that a new entrepreneur must be aware about. An experienced startup lawyer can advise you on which regulations you need to comply, and how you can avoid fines for non compliance.

Startups tend to be naïve about what’s involved, what the pitfalls are, and what the processes are. Too many entrepreneurs don’t know what to do and they end up using attorneys that are a poor fit, or end up paying more than they should. The legal part of their business becomes sort of an afterthought because they’re so focused on their product, getting financing and hiring. Entrepreneurs must take serious care in the Legal area.