What is Startup Legal? Seed to Series A Roadmap in Japan
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This English page follows the Japanese article for readers who prefer English. LegalAgent is an AI Native Law Firm focused on corporate legal work, startup legal support, M&A support and practical legal outsourcing for modern companies.
Overview
Startup legal work in Japan changes with each stage. This article maps what founders should put in place from incorporation to Series A, and links to detailed guides for each theme.
Founding stage: fix what cannot be fixed later
The priority is equity and founder arrangements: shareholding ratios, vesting or buy-back on departure, and decision-making rules. These can only be agreed while relations are good — see Founder agreements can only be made while relations are good. Articles of incorporation, share transfer restrictions and basic contract templates (NDA, service agreements, employment) also belong here.
Seed stage: J-KISS and the first outside capital
Japanese seed rounds commonly use J-KISS convertible equity. It is fast, but the valuation cap and discount effectively fix the future dilution formula at issuance. See What is J-KISS? and the pre-signing checklist. Before hiring a legal team, external support such as legal outsourcing can cover day-to-day contracts.
Series A preparation: stock options and legal due diligence
Six to twelve months before Series A, founders should design the stock option pool — a capital policy decision, not a hiring perk (why, before Series A) — and prepare for investor legal due diligence: shareholder meeting minutes, share records, key contracts and employment documentation. See the Series A legal checklist and what investors look at in legal DD.
Series A execution: preferred shares and the investment documents
A Japanese Series A typically involves preferred (class) shares and a set of documents: the investment agreement, shareholders agreement, distribution agreement with deemed-liquidation provisions, and the terms of the class shares, plus corporate approvals and registration. Negotiation and closing logistics run in parallel, which is where founders most often stumble.
Frequently asked questions
What does startup legal cover in Japan?
Founder agreements and equity arrangements at founding, J-KISS convertible equity at seed, stock option design and legal due diligence preparation before Series A, and the preferred stock document set at Series A.
When should founders first consult a lawyer?
When splitting equity among co-founders. Those arrangements are difficult to fix later and affect the terms of the first outside financing.
Do we need an in-house legal team before Series A?
Usually not. Spot advice covers the early stage, and once contract volume grows, legal outsourcing typically stands up a legal function faster than hiring.