Incorporating a Startup: Legal Keys to Ensure Growth and Attract Investment

The incorporation of a startup is not a mere administrative formality, but a strategic moment in which the legal and corporate architecture that will enable the project’s growth is defined. Making the right decisions regarding the corporate structure, bylaws, shareholders’ agreements, intellectual property, or regulatory compliance will be decisive to attract investors and avoid internal conflicts.

As our partner Borja García Rato points out, “the choice of corporate form, the drafting of bylaws that anticipate the entry of investors or protect against the exit of founding partners, as well as the proper planning of financing rounds, are aspects that must be rigorously analyzed from the outset.”

Corporate form: the basis for scalability

The choice of legal form directly impacts the company’s ability to grow and attract capital.

• Limited Liability Company (S.L.): suitable for early stages due to its flexibility and lower costs, but less attractive for institutional investors.

• Public Limited Company (S.A.): more complex and costly, but offers greater flexibility for funding rounds and issuing shares.

• Holding companies or co-investment vehicles: recommended for startups aiming at international expansion or seeking foreign investment.

Making the right decision at this stage avoids future problems and makes the company more appealing to investors.

Bylaws: much more than a template

Bylaws should go beyond a generic template. They are the roadmap of the company and should anticipate key aspects such as:

• Protection against the exit of founding partners.

• Drag-along and tag-along clauses.

• Creation of different classes of shares for future funding rounds.

• Restrictions on the transfer of shares.

Well-drafted bylaws provide stability and legal certainty for growth.

Shareholders’ agreements: clear rules to prevent conflicts

The shareholders’ agreement defines the real governance of the company and prevents internal disputes. The most relevant clauses include:

• Pre-emption and anti-dilution rights.

• Conflict resolution mechanisms.

• Vesting clauses for founders and key employees.

• Non-compete and confidentiality obligations.

Without a solid shareholders’ agreement, any funding round may be jeopardized by disagreements among founders.

Intellectual property: the most valuable asset

Most startups rely on intangible assets such as software, algorithms, trademarks or know-how. To protect them, it is essential to:

• Assign intellectual property rights to the company from the outset.

• Register trademarks, patents, or strategic designs.

• Establish confidentiality and assignment agreements with employees and collaborators.

Lack of clear IP assignment is often a reason for investors to reject a project.

Regulatory framework: fintech, crypto and healthcare

Highly regulated sectors require strict compliance:

• Fintech: PSD2 regulations, oversight by the Bank of Spain and the CNMV.

• Cryptoassets: compliance with the EU MiCA regulation and registration with the Bank of Spain.

• Healthcare and biotech: requirements of the Spanish Medicines Agency (AEMPS) and strict data protection compliance (GDPR and LOPDGDD).

Anticipating regulation from the company’s incorporation prevents sanctions and strengthens market confidence.

Legal strategy is the first investment

Incorporating a startup defines the rules of the game. Sound legal planning allows the company to:

• Avoid internal conflicts.

• Protect its key assets.

• Facilitate access to professional investors.

• Compete in regulated and demanding markets.

At Summons Abogados, we support entrepreneurs and companies throughout this process, designing legal structures that maximize the project’s value and make it scalable from the outset.