Getting Legally Ready for Funding

Raising money is one of the most exciting - and stressful - parts of building a business. Whether it’s your first seed round, a major VC pitch, or applying for a grant, funding is about more than just a great pitch deck. Investors today look closely at your legal setup before making a commitment. At EKA Legal, we help startups and growing businesses prepare for this process so that when funding knocks, they’re truly ready.

One thing we see often is that founders underestimate how much legal groundwork is needed for funding. They focus on the business idea and growth numbers (which are important), but overlook things like messy cap tables, unclear founder agreements, or missing compliance records. These issues might not stop you from getting that first meeting - but they can absolutely derail a deal during due diligence.

Over the years, we've helped companies clean up their legal structure, close funding rounds smoothly, and build the kind of investor confidence that lasts. Here are some key areas every business should focus on before going out to raise funds:

• Clean and Clear Founding Documents

  Make sure your company is properly incorporated, with all filings up to date (like your MCA filings, PAN/TAN, GST registrations). If you have co-founders, ensure there’s a written agreement that outlines roles, responsibilities, equity, and exit terms. This protects you all - and reassures investors.

  
  

• Cap Table Clarity

  Who owns how much of the company? If there have been informal investments or sweat equity promises that aren’t documented properly, now’s the time to fix that. We help startups build clean, transparent cap tables that can be shared confidently with investors.

  
  

• Due Diligence-Ready Compliance

  Funding rounds often involve a deep dive into your company’s legal and financial health. Investors will want to see:

  • Your tax and regulatory filings (GST, TDS, RoC, etc.)

  • IP registrations (like trademarks and copyrights)

  • Employee contracts and HR policies

  • Past and current funding agreements or loans

  • Any ongoing disputes or legal risks

    
    

We support startups in conducting internal audits before they approach investors, so they’re ready with everything investors might ask for.

• Investor Agreements and Term Sheets

  Every funding round brings negotiations: who gets how much equity, what rights they have, and what protections you both need. We help draft and review term sheets, shareholder agreements, and investment contracts that are fair, clear, and future proof.

  
  

• Choosing the Right Funding Route

  Not every business needs VC money. Depending on your model, you might be better suited for:

  • Angel investors

  • Debt financing

  • CSR or impact grants (especially for NGOs or social enterprises)

  • Government schemes like Startup India or SIDBI funding

    
    

At EKA Legal, we help you explore all your options and navigate the legal side of whichever path you choose.

Fundraising is about more than raising capital - it’s about building trust. When investors see that you’ve taken your legal structure seriously, they’re more likely to believe in your ability to scale. And even if a deal doesn’t go through, having your legal house in order means you’re stronger and safer as a business.

Whether you’re just thinking about your first round or preparing for a major raise, we’re here to help. At EKA Legal, we partner with founders and business leaders to make sure the legal side of funding never becomes a barrier and often becomes a strength.

Let’s make sure you’re legally ready to grow.