Startup

Often but not always, a startup will begin by building a minimum viable productminimum viable product (MVP), a prototype, to validate, assess and develop the new ideas or business concepts. In addition, startups founders do research to deepen their understanding of the ideas, technologies or business concepts and their commercial potential.

A Shareholders' agreementShareholders' agreement (SHA) is often agreed early on to confirm the commitment, ownership and contributions of the founders and investors and to deal with the intellectual properties and assets that may be generated by the startup. Vesting schedules for equity are also setup for Founders, Co-founders and early employees.

The first known investment-based crowdfunding platform for startups was launched in Feb. 2010 by Grow VC, followed by the first US based company ProFounderProFounder launching model for startups to raise investments directly on the site, but ProFounder later decided to shut down its business due regulatory reasons preventing them from continuing, having launched their model for US markets prior to JOBS Act. With the impact of the JOBS Act for crowd investing in US, equity crowdfunding platforms like SeedInvest and CircleUp emerged in 2011 and platforms such as investiere, Companisto and Seedrs in Europe and OurCrowd in Israel. The idea of these platforms is to streamline the process and resolve the two main points that were taking place in the market. The first problem was for startups to be able to access capital and to decrease the amount of time that it takes to close a round of financing. The second problem was intended to increase the amount of deal flow for the investor and to also centralize the process.