Scaling a Tech Startup: Legal Agreements You Need Before Hiring or Raising Capital
- Delta Law
- Nov 9, 2023
- 3 min read
Scaling a technology company involves more than product development and customer acquisition. As you prepare to hire talent, onboard contractors, or raise capital, your legal infrastructure becomes a core business asset. Investors, senior hires, and enterprise customers all expect clear documentation, ownership clarity, and enforceable agreements.
Many founders realize this only when due diligence begins or when a key employee leaves with intellectual property. By that point, the risks are costly and difficult to unwind.
Before expanding your team or securing funding, your legal foundation must be ready. Below are the essential agreements every tech startup needs in place to scale with confidence.
Incorporation and Share Structure
Your corporate structure is the starting point for growth. Incorporating early helps you:
Limit personal liability
Establish a clean ownership structure
Issue shares and implement vesting
Facilitate investor due diligence
Founders should document ownership through formal share issuances and ensure the minute book and cap table are up to date. If you plan to raise capital, your share structure and governance must be investor ready.
Founders’ Agreement or Shareholders’ Agreement
A handshake agreement will not support long term growth. Your founders’ or shareholders’ agreement should outline:
Equity ownership and vesting
Roles and decision-making authority
Restrictions on share transfers
Exit, buyout, and dispute mechanisms
This document protects relationships and prevents sudden exits from jeopardizing the business.
Intellectual Property Assignment Agreements
Investors and enterprise clients will confirm that your company owns its code, branding, software, and proprietary information.
To secure IP properly, you must ensure:
All founders assign intellectual property to the company
Employees and contractors sign IP assignment agreements
Confidentiality obligations are in place from day one
Startups that fail to formalize IP ownership face investor hesitation and potential legal challenges down the road.
Employment Agreements and Contractor Agreements
Hiring technical talent and contractors requires clear legal documentation.
Employment and contractor agreements should include:
Scope of work and responsibilities
Intellectual property assignment
Confidentiality and non-disclosure obligations
Restrictive covenants where appropriate
Payment terms and termination rights
This protects your codebase, maintains operational control, and reduces the risk of misclassification-related disputes.
Confidentiality and Non-Disclosure Agreements
Before recruiting senior employees, pitching investors, or discussing strategic partnerships, you should have NDAs prepared. These agreements protect sensitive information including:
Technology and architecture
Financial projections and pricing
Customer and vendor information
Roadmaps and proprietary strategies
Even if NDAs are not always requested, having them available signals professionalism and protects your intellectual property.
SaaS Agreements and Commercial Contracts
Whether you are pre-revenue or actively scaling, your customer contracts matter. Early templates often come from online downloads or repurposed agreements. Those documents rarely survive enterprise legal review.
Your commercial contracts should include:
Master Service Agreement or Subscription Terms
Order Form and pricing structure
Data Processing Addendum and privacy terms
Acceptable use policy
Termination and renewal terms
Limitation of liability and indemnities
Stronger contracts lead to faster enterprise sales cycles and cleaner revenue recognition.
Investor-Ready Documentation
If you plan to raise capital, prepare your legal foundation before speaking to investors. This includes:
Updated corporate records and shareholder registers
Clear cap table and vesting schedules
Shareholder agreements aligned with future financing
Proper securities exemption filings
Intellectual property ownership proof
Customer and contractor agreements that withstand diligence
Sophisticated investors expect professionalism and clarity. Proper legal documentation increases investor confidence and shortens fundraising timelines.
Scaling a technology company requires more than innovation. It requires legal strength that protects your intellectual property, your team, and your future investors.
When these agreements are in place early, you minimize disputes, accelerate enterprise sales, and approach fundraising with credibility and confidence.
Book a Consultation
If you are preparing to hire, onboard contractors, or raise capital, it is the right time to establish your legal foundation. You can schedule a virtual consultation below.
