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PRESS RELEASE: FounderCatalyst launches, saving UK start-ups £1,000’s in legal fees

Last updated
9th November 2020
Written by
Justyn Waterworth

FounderCatalyst, a new company helping UK start-ups to efficiently manage their funding rounds and engage with potential investors via an online platform, launches today.

The FounderCatalyst platform brings a range of ‘firsts’ to the UK start-up/investor space:

Many start-ups spend around £7,500 on legal fees to support a funding round - money most struggle to find. FounderCatalyst enables start-ups to quickly and professionally create all their legal paperwork as well as manage engagement with potential investors for a fixed price of £1,495 (ex VAT) per funding round.

Sam Simpson, Chief Operating Officer said:

As an Angel Investor, I am constantly approached by founders with a great business idea, but no clear way of navigating the steps necessary to turn the idea into an investable and well-governed business. Often founders cannot find a recommended lawyer, afford them, or even understand exactly what they need from a lawyer.

In my experience, the quality of paperwork supplied by investee companies is incredibly variable which creates a time-consuming due diligence, review, negotiate cycle. FounderCatalyst produces market standard, consistent yet flexible paperwork.

Meganne Houghton-Berry, Angel Investor and winner of Angel of the Year 2017/18 from the UK Business Angels Association said:

Many of the start-ups that I meet struggle with the complexity and cost of undertaking a funding round. As a former founder himself, Sam has come up with the idea behind FounderCatalyst to help streamline the process and reduce costs for start-ups.

The FounderCatalyst platform creates all the documents typically required by investors in a funding round including a term sheet, Founder Service Agreement, Subscription and Shareholders' Agreement and Articles of Association (see notes to editors for full list).

Justyn Waterworth, Chief Executive Officer said:

FounderCatalyst was borne out of a desire to help founders with the legal stage of their funding journey, to simplify and accelerate the process and boost their chances of success. We’re extremely proud of the service being launched today which will help start-ups to quickly access the funding they need, without the bureaucracy and excessive legal fees.

- ends -

Notes to Editors:

To discuss the FounderCatalyst service in more detail please contact Sam Simpson on [email protected] or 07866 726060.

Legal documents produced by the FounderCatalyst platform

The FounderCatalyst platform produces the following key legal documents as required by any potential investor in a funding round:

  1. Initial Term Sheet: this summarises all the key points of the deal being offered to potential investors.
  2. Founder Service Agreement: an agreement between the start-up and the company, very similar to an employment contract.
  3. IP Assignment Letter: this ensures that all intellectual property relevant to the company has been transferred to the company itself.
  4. Subscription and Shareholders' Agreement ("SSA"): this document details the agreement between founders, the company, any existing shareholders and new investors.
  5. Articles of Association: this document works alongside the SSA and contains the company's constitution.
  6. Cap Table: one for before investment and one for after. These provide details of current and future shareholders.
  7. Term Sheet: this summarises all the key points of the deal agreed with the final investors.
  8. Resolutions for both shareholders and directors: these formally allow the company to take on the new investment.
  9. Disclosure Letter: this enables start-ups to formally disclose any issues relating to their business to potential investors.

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