• The New Year is synonymous with fresh starts. Some people may resolve to finally start going to gym. Others may promise to devote more time to themselves and their families. And others will decide that 2019 will be the year that they will launch their own start-up.


    Starting your own start-up is fraught with difficulties and pitfalls. However, getting the right legal advice and systems in place from the outset will eliminate or minimise many potential problems down the line. (Information Credit –



    It is of utmost importance that an entity – such as a company or trust –is created to run and administer the business. For the vast majority of start-ups, a limited liability private company will be the most convenient and useful entity. The purpose of incorporating such an entity is to protect your personal assets should the business fail. For this reason a sole proprietorship is only a viable option for purely survivalist enterprises.



    A memorandum of incorporation and a shareholder’s agreement are the founding documents of a start-up business. The former sets out the rights, duties and obligations of directors and shareholders in a company whilst the latter regulates the relationship between shareholders to the extent that it is not covered by the memorandum of incorporation. Collectively, they can be considered as the “constitution” of the business that determines how it is be structured, run and the rights, responsibilities and relationships of and between shareholders and directors.



    Contracts are absolutely essential for the running of any business. Contracts will be required for your clients or customers, debtors, employees and possibly investors and third party contractors as well.


    Contracts need to be clear, unambiguous and to comply with any regulatory requirements. For example, any contracts with customers need to be compliant with the Consumer Protection Act whilst contracts of employment need to comply with the Basic Conditions of Employment Act and the Labour Relations Act.


    Failure to adhere to the requirements of the above acts can be quite costly and time consuming. It is essential to ensure that compliant and professionally drafted contracts are in place from the outset.



    Before your start-up commences business, you will need to ensure that you have any and all applicable licences. For example, there are specific licencing processes that need to be followed should you wish to sell alcohol or provide loans. In certain circumstances, failure to obtain a licence or to comply with the conditions of a licence will not only cost you money but may be a criminal offence. It is important to ensure all licences and other statutory requirements have been obtained or met before your business opens,


    An experienced business lawyer will be able to advise a start-up on all of the above, as well as draft the necessary founding documents and contracts. An experienced lawyer will also be able to focus on the other legal aspects, leaving you to concentrate on your start-up’s core functions.