While this is on, you still have a few other tasks requiring your involvement. Here are some proactive measures you should undertake to avoid legal issues while starting up.

Clarity Regarding Business Structure

While it seems easy at first glance, this decision should be taken carefully. There are more than 10 types of business structures in India that one can choose from. Choosing the right one for your start-up is vital.

Check out the table below to get clarity on the different types of popular business structures that startups can go with.

Generally, a start-up business in India can either be registered as a Limited Liability Partnership or as a Private Limited Company. The core issue is identifying the business nature, corporate flexibility, tax efficiency, compliance requirements, and cost of formation, etc. A typical Indian scenario sees start-ups incorporating as a Private Limited Company; purely because it gets easier to raise funds from investors.

Legal Documentation

Start-ups should stick to standardized policies and procedures from the beginning. It is usual for companies to enter into agreements due to operational needs. The policies for this should be set up.

The agreements like shareholders’ or co-founders’ agreement, non-disclosure agreement, terms and conditions for website usage, etc., represent business’ concerns.

• Co-founders Agreement

A founder’s or a co-founders’ agreement spells out roles, duties, and responsibilities of the company’s founding members. This is a broad agreement covering multiple aspects that founders may undertake during their tenure.

A shareholders’ agreement outlines the shareholders’ rights by defining the situations under which they can exercise their rights. This includes shareholders’ right for share transfers, right of first refusal, redemption upon death or disability and also their authority to control and run the start-up.

• No disclosure Agreement

NDAs work to protect the start-up as it safeguards the founder and employees’ ideas along with the intellectual property. The following are the key legal documents required to start a business.

1. Defining confidential information
2. Handling of confidential information
3. Owners of information

• Vendor Agreement

Imagine entering into a vendor contract that has some hidden clause(s) that possibly could trigger unpredicted price escalation or give termination power to the other party without notice requirements. This can create chaos within your startup. Therefore, though not mandatory, it is important to secure your business transactions with symbiotic contracts with third parties.

• Mandatory Documents

Articles of Association and Memorandum of Association are the two fundamental documents for any limited company. For LLP registration, the signature of all partners is a must. Also, having a partnership deed is important for the smooth functioning of a Partnership Firm.

Understanding Applied Taxation Laws

Know about the taxation structure that applies to you. Taxability will majorly affect your business outcomes and therefore, you should plan accordingly. You will need to get accustomed to taxation and accounting as it is pre-requisite for any filings and annual legal compliance with respective authorities. Get familiar with GST since all indirect taxes are now abolished. GST for different goods and services are classified under multiple tax slabs.

Ranging from monthly GST filing to quarterly, and annual filing, following the GST regulations is very important for any business to avoid future hassles. Taxation for start-ups also involves declaring tax liabilities at the time of incorporation.

There are a number of schemes for tax and incentives at the state and national levels. Keep checking for initiatives by the Indian Government. There are certain initiatives where a start-up can claim tax exemption for 3 years even from capital gains and investments above fair market value. But, ensure these conditions are fulfilled to leverage this initiative. Staying updated is the key!

Requirement for Licensing

Start-ups don’t operate in ambiguity. If your start-up is into something that requires licensing, do it. Play by the rules or else be prepared for expensive, multiple legal suits, slow investments, loss of investor faith and even shutting down of business. Hence licensing awareness is necessary hygiene that start-ups should strictly follow.

Check, if your startup needs to comply with any of the below conditions:

• Get the Shops and Establishments Registration done with respect to the Premises from where the business is run.
• Activity-based licensing requirements may arise depending on the nature of business. For example; FSSAI License or Food License is required in case of starting up a food truck, restaurants, food joints, food item or consumable item packaging, food item or consumable item delivery, etc
• GST Registration is advisable if not mandatory. Though, it is mandatory for all Business or Professional entities exceeding INR 20 Lakh turnover a year (10 Lakh for north-eastern States). You are bound to scale your start-up with time. Therefore, it is best to have a voluntary registration.
• Business activities involving products’ import and export require the proprietor to obtain Importer – Exporter Code.
• To reap the benefits of government schemes and subsidies, it is recommended to have a registration with MSME Department. Do the same to avail benefits under schemes introduced by the Government for prescribed activities.

Cash Flow Management

A start-up needs to introduce capital and funds in the business to match the day-to-day business requirements. Ensure this by bringing in the working capital for your start-up. But then, there are multiple ways to raise capital. It is essential to keep a track of your finances on paper to acknowledge its legal stand.

Books of accounting are also another vital aspect. Good start-up hygiene involves maintaining accurate books of accounts and auditing them regularly. This is to ensure all the necessary accounting and taxation rules are adhered to. Negligence in doing so can lead to serious accounting discrepancies and problems in annual compliances.

During the business incorporation marginal capital is introduced. But then, that is not enough to run a healthy start-up so it will require finances from multiple sources viz.; internal and external.

Read more about: Ways to improve cash flow

What you need to understand for getting capital from external sources?

Most of the Indian start-ups rely heavily on equity holders for investment. The return to the equity holders is considered not as an expense for the Company but a profit distribution in the form of a dividend.

Start-ups should make a note that funds raised from the external sources are charged against profit. It is because the pre-defined interest rate is paid irrespective of the profit earned by the Company. Though start-ups benefit from raising funds from external sources, it may or may not dilute the ownership of members. Moreover, such a route will help start-ups to get the best resources for the company’s growth initiatives.

Funds provided by the venture capitalists and term loan providers are on the lookout for timely return from the Company. This is because they lend in money for the longer-term. Therefore, start-ups should consider presenting financial planning well in advance and in a concise manner. This goes to build investors’ trust right from the initial funding stage.

Conclusion

The steps of incorporating, registering, managing, and operating start-up needs more detailed attention. This should be focused on the provisions defined for governing the respective dealings, procedures, and business actions. This is a little frustrating for entrepreneurs who are dedicatedly immersed in primary business activities. But the importance of legal requirements and procedures should not be overlooked, it fundamentally protects the business.

With all your marketing efforts for your business in place, it’s a good idea to have an all-in-one payment solution in place as well. Sign up with PayUmoney to enjoy the best payment gateway experience and grow your business effortlessly!

The post How to Avoid Legal Issues While Starting a New Business appeared first on PayU Blog.

From Shrijay’s trunk of expertise….

The people and businesses are going global with a stark rise witnessed in international travel as well. Perhaps, this is a reason why international money transfer is the need of an hour.

International money transfer is an easy and secure way to send and receive money, globally. There are some specifics that one needs to keep in mind while transferring money internationally due to different rules and conditions set by the bank. Outward remittances are tricky as they are under the scrutiny of the government.

Research suggests that videos out rule all the other form of content. There are various types of videos like a tutorial, testimonial, events, vlogs, demos etc.

Wire transfers are electronically transferred money from one entity to another across the world. There are two ways to do it:

• Inward remittances: Transfer from a foreign country to India.

• Outward remittances: Transfer to a foreign country from India.

Types Of International Transfers

Compare multiple mediums: It is obvious to think of the bank as the first medium to transfer money to a distant land. But, one should always compare all the mediums beforehand to take a wise decision.

High processing fees and special brokers come with a price. Money transfer services offer competitive exchange rates and customize service as per needs. Plenty of online money transfer services offer the convenience of time and place. Compare all those mediums based on service, risk factor, exchange rate, and fees.

Online transfer: Online payment services are available for sending and receiving funds. The transferred funds get converted into a receiver’s currency.

Money transfer: The global payment service providers simplify the fund transfer process. These companies have a worldwide reach wherein they send money to their agents from where it is available. You can receive the same through your normal bank account on a prepaid card or via a mobile wallet.

Mobile wallet: A mobile wallet allows sending and receiving funds directly from a Smartphone, making it the preferred choice for a small amount. The downside is the high conversion charge and lack of options to choose from.

Prepaid cards: Prepaid cards are quite handy since they are easily accessible funds using ATMs.

Bank Wire Transfer: Individuals wishing to transfer funds from a foreign country to India need to approach the local bank for giving an order to transfer an amount to the entity in India.

• Currency of transfer

• Bank Name

• Common bank’s BIC/SWIFT Code

• BSB Number

• Account Number

• Account Name and Address

These details help the bank to identify the account for depositing the money. Bank sends a message about the details of a settlement post in which the transfer happens. Here is where the amount is credited to the recipients’ account.

How To Find The Best International Payment Gateway

Fees: This is the most important point that helps to decide the money transfer process. The payment routes through a series of different intermediary banks before the payment get to the recipient. The processing fee charged by these banks gets deducted from the payment.

Comparing fees
is the best option to select the most cost-effective option. Also, consider the
fees that apply to both parties involved.

Reach: The limited read of a few service providers the reach becomes an issue. It is therefore recommended to opt for the most accessible method for a convenient transfer.

Exchange rates: Exchange rates matter a lot in international money transfers. Opt for a provider that gives you fast and safe transfer with a convenient exchange rate. A high charge of the exchange rate can directly affect the amount of money sent by reducing its value.

Reputed Agent: One expects a strong company to control and manage their fund transfer process. A competitive scenario needs the surety of funds and personal details in safe hands. Better to check out some customer reviews before making your decision.

Know your senders’ limit: Make sure to set your daily international transfer limit for the safety of your money. This will help you plan your transactions better and receive the money at the desired time.

Check processing times: Some service providers’ process payments only on certain days of the week. Payments may delay when received after the cut-off time. Hence it is best to plan your IMT.

Pros Of International Payment Gateway

Convenient and Simple: Most money online remittance services offer simple and easy money transfers. The recipient gets the funds in real-time once transferred by the sender.

More choices: There are various methods and online applications like PayU Money that help to send or receive money. You can request the multicurrency payment option and use it to receive international payments (add more details as required). Such alternatives help you from relying only on the banks for money transfer.

Secure: A trusted service provider is always a safe bet when it comes to wiring the money. Ideally, one should go for the ones who are verified and has a VeriSign signature assures transaction is safe and secure

Cons Of International Payment Gateway

Fees: The only drawback is that most money transfer providers have applicable fees that could make their services expensive. Hence, it is best to choose the best by looking into various options available.

The above knowledge, tips, and personal experiences belong solely to Shrijay Seth of LegalWiz. You can reach out to him for any advice related to this topic on LinkedIn (please check the author section below for information). If you would like to write a blog for PayUmoney as a guest please do get in touch with us: marketing@payu.in

It is time to take your business beyond borders with PayUmoney (T&C applied).

The post Things You Need To Know Before Making International Money Transfer Online appeared first on PayU Blog.

From Shrijay’s trunk of expertise….

When it comes to getting the work done – swift and smart, it boils down to being a super ninja who has it all to combat everything that is thrown in the way. Here are the 5 proven ninja techniques to be a successful entrepreneur when followed cautiously.

1.Building An A-Team

Building your ‘A-team’ involves finding those who are equally crazy and passionate about your idea. The role of an entrepreneur in getting the A-team ready lies in, pumping more and more like-minded people that help to create a sense of startup community. These are the ones on whom you would rely on.

In return, it will help you start a marketing chain reaction without any monetary bet, building the confidence and revenue. From placing the right personnel at the right place to evaluating performances on the basis of their strength, is the key to get the work done.

2. Groom Your Persona

The true value of any successful entrepreneur lies in his or her persona. As an entrepreneur you can structure a persona which is approachable, easy going yet hungry for success. For a perfect balance, entrepreneurs need to keep an image, streamline it with the face-value of your company and shape it towards a brand. This is something which will offer a value proposition to your company or startup.

Here are a few things that an entrepreneur needs to indulge in for grooming an ‘all-arounder’ persona:

• Ambition: It is best to lead a vision with the passion that blends with burning and gut-wrenching need to see it come alive.
• Self-confidence: Keep believing in yourself even if you waiver a bit here and there.
• Adaptability: To changes and to things that happen unplanned. Groom yourself to be able to think from your feet.
• Smart working: Don’t be a hero. Share your work and split the tasks. Monitor, analyse and evaluate with the utmost scrutiny.
• Be at ease with risk: Take calculated risks and be responsible for everything that falls apart.
• Stick to the ground: Burn ego to go far and hit that milestone that you’ve set up for your startup.

Take risks and tap the opportunities that unfold by leading the startup as a dynamic leader!

3. Know Your Customer Right

Most of the time startups fail because there are not enough customers to buy the idea. If you aren’t sure of who is going to benefit from your service or product then it definitely means that there are no potential customer that exists.

So the first thing to do even before planning the budget, raising the capital, or even registering your business, is:

• To ensure that there exists a customer; the one who is willing to buy your product or use your service.

There’s no business without a customer and every successful entrepreneur will know his/her customer from the very beginning. Once you have known your customers in the right manner, you could also identify the quality value that you can offer to solve their problems.

4. Value & Use Time Wisely

Thinking that we have enough time is a trap of fallacy. Human beings are procrastinators and entrepreneurs are no different. The biggest misconception of having time by your side leads in delaying the most important tasks. Keep all distractions such as social media, texting and so on at bay for more productivity and hence results!

It’s a fact that you don’t have enough time to let go. Therefore getting the priorities set is the only option to make the most out of what you have. Remember: There are high chances that a big idea in your head is seeding somewhere else too.

Pro-tip: Break your bigger goals into smaller chunks that you can manage. Being an entrepreneur is not that taxing as it seems if you keep finishing tasks based on the fixed deadlines.

5. Networking Is Important

Enough has been said about this and I can’t really insist on how much networking matters for the early success of your company. The key lies in balancing both – business and networking activities. With more organized networking, idea exchange with other entrepreneurs initiates deeper business insights and connections. Join as many startup networking events happening in your town during the weekend and catch up with fellow entrepreneurs around to have a short chat.

The journey as an entrepreneur is filled with uncertainty and is not an overnight story. One has to deal with problems related to complex government regulations, resources and finances, and plenty of other things. It is, therefore, best to have someone from the same breed around to mentor, to look up to, and even share talks on business. Proper guidance opens new opportunities, especially for getting into the partnership and collaborations. Upgrading yourself timely with regards to the techniques mentioned above is a bonus! Keep going, keep sailing.

The above knowledge, tips, and personal experiences belong solely to Shrijay Seth of LegalWiz. You can reach out to him for any advice related to this topic on LinkedIn (please check the author section below for information). If you would like to write a blog for PayUmoney as a guest please do get in touch with us: marketing@payu.in

With all your marketing efforts for your business in place, it’s a good idea to have an all-in-one payment solution in place as well. Now to enjoy the best payment gateway experience and grow your business effortlessly!

The post 5 Proven Ninja Techniques To Be A Successful Entrepreneur appeared first on PayU Blog.

From Shrijay’s trunk of expertise….

Entrepreneurship is a journey by itself and just like any other journey, it has its own do’s and don’ts. I too, started this journey to provide business professional services a few years back. It’s only then did I realize that it would have been an added advantage for me to know the rule book beforehand! But to make the startup journey easier for all aspiring business minds reading this, here are the 5 things you must look forward to polish right from the beginning.

1. Keep Your Focus & Dedication Intact

Juggling job with a start-up on a part-time basis is a bad idea. The amount of attention, hard work and persistence your entrepreneurial venture requires is 10X vis a vis is a regular job. Eventually, I too had to call it a day at my full-time job and concentrate on my venture.

Take the hard and harsh decisions to follow the dream completely without any compromises.

Being focused on venture demands not only laser-sharp focus towards work but also on various other aspects of entrepreneurship like;

• Unique Value Proposition (UVP): Your prospective customers will have hundreds of other options. You need to work hard and smart towards making your offerings stand out from competitors despite offering the same service or product.
• Market/product fit: Keep your eye on the quality of your product/services and the size of your target market. These two points will easily help you gauge your way ahead.
• Single success metric: When you start a business, how would you define success? You need to shortlist a couple of essential metrics such as conversions, GMV and so on to choose the most valued metric for you in that time.

2. Watch Out For Data Trends

Keep a vigilant eye on your data. To achieve an armor of a successful industry leader, you need to focus on cultivating data maturity from the beginning.

If you are going to be an entrepreneur, you can’t fear failure. You have to develop a tolerance level of measured risk.  – Bernhard Niesner.

Personally, the following steps worked wonders me, you can try them too!

• Enable the current data structure to provide a holistic set of information
• Use various tools to help with data assistance
• Invest in custom data applications tailored to my services and business model

Then, I used that data to gauge whether I can take my business decisions based on the data. And then I took a closer look at how others, especially my competitors utilize it.

Sites like Etsy and Craig’s List, and even local trade shows for that matter is something wherein you can test-market early product prototypes or services and learn from mistakes. Failure is inevitable, it all boils down to how much can you learn and how fast can you pick yourself up.

3. Seek Support: Co-Founders, Employees And Consultants

Quite often, because of the way start-ups are perceived today, entrepreneurs feel shy or reserved to approach others for advice. There are loads of resources available online: blogs, videos, where you can find inspiration. But learning and consulting your own teammates, counterparts and seniors make a lot of difference. Also, the importance of venturing with co-founder enables the simplification of the gap filling process. The right sense of ownership and accompaniment gives a beautiful twist to a traditional equation of 1+1 = 11!

I would tip here with: Just go out there as a learner and implement all those lessons to be a successful entrepreneur.

4. Legal Formalities & Protecting IPRs

Newbies are often trapped in an enigma of whether to register a private company (Pvt.) or LLP in case of co-founders. Legal formalities involve more than just picking the right formation type. There are companies who tasted the sweetness of initial success and later called it a “quit” because of law enforcement. Here are the 5 things that I would like to share:

1. Choose a Right Business Structure
2. Know Licensing Regulations
3. Have legal documents and policies in place
4. Adhering to taxation compliances
5. Manage your Cash flow and Accounts

Given that many new-age startups are tech-based, protecting IP is not a luxury, it is a necessity! In fact, many successful startups enjoy massive evaluations just because of the intellectual properties and proprietary algorithms that they could create.

 It has been estimated that on an average, over 80% of the value of a startup company is based on their IP portfolio. (Shrijay’s sources)

Here are the thumb rules to follow:

• Get a Trademark: Protect your branding – name, symbol, sound or fragrance that creates a recall for your brand
• Protect with Patents: If your product or process is true to the test of the invention and creates a better value and efficiency, consider protecting it with Patent.
• Copyright for Works: If you have created original content, be it musical composition, photograph, write-up, or a sculpture; you must copyright such work.

Protecting IP leads to:

• Startup Valuation Based on IP Rights: Startups don’t necessarily have massive goods’ stocks or workforce to start with. Hence, most of the value of a startup is usually derived from its IP rights.
• No Over-Stretching the Finances: It has to be stated that unless your startup offers something that has zero production costs, you will have to loosen the purse strings at times to make money. What most startups don’t consider, are the expenses that may derive from not taking proper care of IP rights. {Need this as it talks of IP – subject specific}
• Impose Control on What You Have: Sure, it is nice to have someone else promote your services or goods for free. But what are you going to do when the quality is not up to your mark? In many cases, the answer is a simple “nothing” if you haven’t taken care of the IP rights. 

By keeping all IPRs and legal formalities in place, you will get the ability to restrict unauthorized use of your owned IP or license for others’ commercial benefit. It also helps you relax and focus on necessary.

5. Balancing Emotions With Practicality

Being an entrepreneur is not a destination, but a journey of constant improvement, evolution, and perseverance. It is a roller-coaster ride with quick highs and lows.

 It has been a long journey for me as well. But, above all, it is important to take practical decisions out of the emotional experiences.

Remember, when you hold that commanding position, by default trusteeship of everyone who signed up for the journey is an assumption. You have to make decisions that are good for the company at large.

Taking care of the employees and people who take care of your business is the ultimate key to grow. There are no shortcuts to valuing people. A compassionate entrepreneur sails the farthest! It is about understanding your customers as well. Instead of running behind clients and focusing on increasing your clientele, cater to a few clients in the best manner and others will follow suit as a snowball effect gradually!

The above knowledge, tips, and personal experiences belong solely to Shrijay Seth of LegalWiz. You can reach out to him for any advice related to this topic on LinkedIn (please check the author section below for information). If you would like to write a blog for PayUmoney as a guest please do get in touch with us: marketing@payu.in

With all your marketing efforts for your business in place, it’s a good idea to have an all-in-one payment solution in place as well. Now to enjoy the best payment gateway experience and grow your business effortlessly!

The post 5 Things Every Entrepreneur Must Consider Before Starting Up appeared first on PayU Blog.