drafting privacy policy

Demystifying Privacy Law: Drafting a Privacy Policy

If your business collects personally identifiable information (or PII) about your customers, you will need a privacy policy to let them know how you plan to collect, use, share and secure information about them. In an increasingly digitalized world, privacy policies command nearly the same level of respect as mission statements. Privacy policies set out an organization’s first principles of consumer protection and provide a roadmap of how sensitive issues such as PII are handled. This article describes some of the factors that go into a well-drafted privacy policy–and the factors that we advise our clients to think through.  Read more

personally identifiable information

Demystifying Privacy Law: Personally Identifiable Information (PII)

Nearly every organization collects personally identifiable information, or PII. Because of the sensitive nature of many different types of PII, its collection can pose an array of unique challenges, especially for younger or smaller organizations without a dedicated privacy department. The unwarranted release of such information can ravage people’s lives and forever destroy any modicum of trust an organization may enjoy with its customers and with the general public. One of the most fundamental privacy questions an organization may face is: what does “personally identifiable information” mean? Given the differing responsibilities that an organization has with respect to PII versus non-PII, the answer to this question is critical. This article is designed to help you flesh out the concept of personally identifiable information and begin to think about the ways your company should handle PII-related issues. Read more

us eu safe harbor

Demystifing Privacy Law: Making Sense of the U.S-EU Safe Harbor

UPDATE: Since this article was drafted, the US-EU Safe Harbor program has been shut down. There is now a new regime in place named Privacy Shield. Please see this article for more information.

Any company looking to transfer data about users from the European Union region to the United States will likely need to familiarize itself with the U.S.-EU Safe Harbor Framework. This article covers three topics: what is the U.S.-EU Safe Harbor, what are its advantages and disadvantages, and how to comply with the Safe Harbor. Read more

for-profit or nonprofit or hybrid

For-Profit or Nonprofit or Hybrid?

Traditionally, the divide between a for-profit or nonprofit organization was clear: for-profit businesses would engage in revenue generation and nonprofits would engage in charitable work to solve social issues and would largely stay away from revenue generation. The rise of social enterprises in recent years, however, has made that distinction less and less clear. Social entrepreneurs are finding innovative ways to challenge the traditional thinking about nonprofit organizations (by focusing on economically sustainable models) and for-profit businesses (by focusing on solving social issues). As you set out on your mission to change the world, you will have to decide if you want to form your venture as a for-profit or nonprofit–or perhaps some hybrid of the two. The answer will largely depend on your best guess as to source of funding and your activities.

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are term sheets binding

Are Term Sheets Binding?

Agreeing on a term sheet is the first step in the exciting process of raising money for startup founders. It sets out the parameters of the deal that will be executed in one or more legal documents to follow due diligence. But you may be wondering to yourself: “Are term sheets binding?” Unfortunately, the answer is that it depends. Read more

Important Terms in Convertible Notes

Important Terms in Convertible Notes and Convertible Equity

When negotiating a convertible note or a convertible equity instrument, there are a few key terms in the negotiation that are significant for the investor and the entrepreneur. In a previous article, we discussed the differences between convertible notes and convertible equity. This article discusses the important terms in convertible notes and convertible equity, including the cap and the discount.  Read more

typical startup structure

Typical Startup Structure

Startups often ask us how a typical startup is structured. While there are plenty of free and affordable resources for various forms, they don’t provide much guidance on what forms to use and why. In fact, there is no one-size-fits-all approach to structuring a startup. Each is unique in its needs. Still, there are some default positions that apply to the typical startup structure for a technology (or other) startup seeking venture capital.  Read more

Terms of Use Legally Binding

When Are Terms of Use Legally Binding?

You’ve done it many times before… you click the box that says “click to agree to our Terms of Use” (and let’s be real – you didn’t read it). Does that check box create a legally binding agreement? What about when companies just post a terms of use and you never click on the link for those “agreements”? This article discusses the question: “when are terms of use legally binding agreements?” The short answer is that terms of use are legally binding when the user has sufficient notice of the fact that he/she is agreeing to the terms of use. Read more

convertible equity

Is Convertible Equity Better Than Convertible Note and Preferred Stock?

Convertible equity has gained popularity in Silicon Valley after Y Combinator made its Simple Agreement for Future Equity (or “SAFE”) available for free and used it for all of its startups. Since then, 500 Startups followed suit with its affectionately-named KISS document. The intent in creating the convertible equity was to provide a better tool–compared to the convertible note and preferred stock–to handle early-stage investments by angel investors.

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Friends and Family

Raising Startup Funds from Friends and Family

Raising funds from friends and family often seems like the logical first step for a new business to raise money. After all, you will be hard pressed to find an investor who is willing to shell out funds when your whole business is simply a couple motivated people with a great idea. However, accepting money from friends and family is not as straight forward as it may seem. This article discusses various options for structuring an investment from friends and family. Read more