The rise of Indonesian digital industry has triggered demand for services that support different aspects of businesses, including its legal aspect.
Startup Legal Clinic Executive Director Ivan Lalamentik was working as a corporate lawyer when he noticed a growing information disparity among startup founders and investors that could potentially have a negative impact on their business.
“We talked to our startup friends and we found out that they are experiencing difficulties in knowing and understanding the legal issues that they are facing,” he explained in an e-mail to e27.
Together with co-founders Putu Krisna, Ananda Ramadhan Maulana dan Aranto Munaf, in June 2015 he launched a service to help local and international startup founders and investors operating in Indonesia.
Startup Legal Clinic (SLC) aims to educate startups about legal issues that they are facing. Although members of the SLC team cannot offer legal services in their official roles as legal practitioners, they can do so in their own capacity.
They can also refer startups to practitioners who are willing to give fair and affordable legal counsel.
“We are taking reference from a model applied in the US, where the entrepreneurship climate is being supported legal clinics facilitated by law schools in the country. Right now, as far as we know of, we are the first legal clinic [in Indonesia] to give support to our startup friends in form of law awareness,” said Lalamentik, who recently spoke at Echelon Indonesia 2016.
SLC receives grant from Young Southeast Asian Leaders Initiative (YSEALI) — a signature programme of US President Barack Obama to strengthen leadership development and networking in Southeast Asia — as the second batch winner of their grant competition.
The grant is focussed on funding #LAWARENESS, SLC’s social project that consists of discussions with legal experts as well as the creation and dissemination of infographics, posters, and videos about Indonesian legal system.
SLC has worked with at least 50 companies which they refer to as their ‘colleagues’, not ‘clients’. Most of them want to learn about different venture forms in Indonesia, intellectual property rights, contract drafting, and regulations that might impact their businesses.
According to Lalamentik, the main issue with regulation is that many of them do not accommodate business models of foreign startups looking to enter Indonesian market.
“This can make applying for permission difficult. It’s not rare to find foreign startups who wanted to enter Indonesian market, but ended up not setting their companies in Indonesia,” he said.
“In the future, foreign startups also need to stay updated with regulations in Indonesia, such as the government’s plan to enforce over-the-top companies to set up permanent ventures in Indonesia, taxation, and other things,” he added.
Take an example of mergers and acquisitions (M&A). There are several points that both local and international startups need to keep in mind.
“M&A for tech startups is not the same as other conventional businesses. Startups need to realise that their biggest asset is an intangible one. Therefore, they need to consider asset protection before taking corporate actions such as M&A,” Lalamentik warned.
To promote its services to startup communities, SLC utilises social media campaigns, participates in various startup events, and partners with several media outlets.
The organisation has a big agenda in 2016.
“We are planning to open a SLC Research Center that will serve as a platform for legal education, legal advocate for various startup-related legal issues in Indonesia, and tech development in the field of law,” concluded Lalamentik.
Image Credit: Startup Legal Clinic