How to Future Proof Your Company Structure

Lawyers For Tech Start Ups in the UK

If you are a founder or owner-operator, have you ever stopped to ask yourself what your long-term goals are and what assets drive the value of your business?

If you haven’t, your corporate structure may not support your ambitions and could even slow you down. A company structure should facilitate the ambition of founding teams and protect the intellectual property or assets the value of a business is built on.  Here Dragon Argent, corporate law consultants have taken a look at the importance of investing in the structure of your business early.

The Problem Statement

Too often, entrepreneurs are poorly advised at the point at which a company is formed, acting on siloed professional advice that can create issues that are time-consuming and costly to unravel later.  A poorly planned corporate structure can:

• Be difficult to adapt to changing needs
• Can fuel risk for investors
• Increase tax liability
• Fail to protect founders’ long-term interests

Ultimately, creating barriers that make it harder for founders and entrepreneurs to achieve the long-term objectives they set out with.

The Solution

If planned appropriately, creating a future-proofed and flexible corporate structure can be straightforward and cost-efficient if you consider:

• The intellectual property or assets the value of the business is based on and how to protect them long-term
• Your likely expansion or joint venture ambitions
• Future mergers or disposals opportunities

Joined up and commercial professional advice will consider these factors and result in a bespoke structure and framework that will help you achieve:

• Appropriate tax treatment and protection of entrepreneur, EMI and EIS relief status
• Flexibility to license or create Special Purpose Vehicles to adapt to opportunities and threats
• Protection of shareholders’ long-term interests
• Correct treatment of intercompany loans and other accounting considerations

These benefits become harder and more costly to realise the more complex a business becomes.  There are a myriad of objectives a founder can implement at any given time, but ensuring you have a future-proofed company structure that mitigates risk and allows you to respond to opportunities in an agile way is something that will deliver value throughout the lifecycle of a business.

If you’d like to discuss how to better protect your IP or assets, tax relief status, and long-term interests, get in touch with our startup law firm on the details below as we’d love to learn more about your business.