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Which company structure is suitable for our startup to raise investment?

For start-ups planning to raise investment, the joint-stock company is the most workable structure in practice. Investors prefer it because share transfers are free and straightforward, bec…

Updated · July 20261 min readCategory · Legal Tech
Short answer

For start-ups planning to raise investment, the joint-stock company is the most workable structure in practice. Investors prefer it because share transfers are free and straightforward, because privileged shares and an option pool (ESOP) can be set up, and because corporate records such as the share ledger can be kept in proper order.Both joint-stock and li…

For start-ups planning to raise investment, the joint-stock company is the most workable structure in practice. Investors prefer it because share transfers are free and straightforward, because privileged shares and an option pool (ESOP) can be set up, and because corporate records such as the share ledger can be kept in proper order.

Both joint-stock and limited liability companies are governed by the Turkish Commercial Code (No. 6102); in a limited liability company a share transfer requires a notary and registration, which is a real disadvantage in a fast round. We design the incorporation, or the conversion from a limited liability company, with the coming investment rounds and the share structure in view, and we settle the balance of voting, vesting and exit among the founders in a shareholders’ agreement from the start. The right structure also brings down the legal cost of the rounds that follow.

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