1. Innovation and Product Development
Starting your own company
Jakob A. Bejbro Andersen
jaban@mek.dtu.dk
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“Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product
Development Department of Mechanical Engineering, The Technical University of Denmark”

2. Why start a company?
•A number of practical reasons:
– De-couple personal and professional risk
– Get investments
– Avoid VATs (DK:MOMS)
•However, more importantly:
– Starting a company means being your
own boss.
– You get to change things and create
value for others.
– The relation between effort and payoff
cannot be clearer.
2 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

3. A case we all know
”Citrix buys Podio for social collaboration”
Cost: Rumoured to be a nine figure acquisition!!!
http://www.youtube.com/watch?v=nTs3iLy3q3Y
3 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

4. Why start a company – some statistics
•Every year the danish governement puts out its
”Iværksætterindeks” (Entrepreneur index).
•The index shows that young companies create
almost half of the new jobs (Indeks 2011).
•In short:
–You’ll be making
a difference!
4 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

5. Common misconceptions about starting up
• ”As an entrepreneur you are left to your own devices”
– Wrong, there is a mass of different organisations out
there looking to help entrepreneurs (Connect DK, Vaeksthus
GC, Stardust DTU and many more)
• ”Denmark is a bad place to start up”
– Nope, Denmark has on several occations been rated as
a top three country for entrepreneurs.
• ”My idea is inferior – why should I bet on it”
– Not true; if you have done your homework (market
analysis etc.) you probably have a good starting point.
5 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

6. Some important things to remember
• Collatoral – as a single person company or as board
member, you can be held personally responsible and be asked to
provide collatoral for
• Unemployment – In Denmark, you are not eligible for
!
unemployment benifits if you own more than 10% of a company.
!
• Tax report submission – If you are self-employed,
!!
you will have to fill in an extended tax report.
• Wages – As an entrepreneur, you can expect to get
paid according to what is ledt from the company’s
operations.
6 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

7. Choosing your company type
• Depending on a number of different factors, you may
choose different types of companies.
Personally I/S Aps A/S
owned (Interessent- (Anparts- (Aktieselskab)
company skab) selskab)
Documentation None Contract between Several Several
on formation founders documents Documents
Help from No No Yes Yes
auditor/lawyer
Formation capital None None DKK 80.000 DKK 500.000
!
Founders provide
Collateral
Yes Yes Limited Limited
!
Board required No No Yes Yes
Reporting
requirements
Personal tax
report*
Personal tax
report*
Extensive* Extensive*
!
British equivalent Sole trader Limited Liability Limited Company Public Limited
Partnership (LLB) (LTD) Company (PLC)
* Added reporting requirements if company has employees
7 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

8. Personally owned company or I/S
• If your turnover is less than DKK 50.000, you need to do
nothing.
• You can set up a company in 15 minutes on www.virk.dk
• You provide collateral if the company cannot pay
creditors(!).
• In an I/S the ownership is shared between several
persons.
• The owners in an I/S provide collateral on a
solidary basis.
8 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

9. Aps or A/S
• The share capital has to be provided before forming the
company
– Aps: 80.000
– A/S: 500.000
• This money is put on a bank account created for the
company.
• Again, you can use www.virk.dk, but you need a number
of additional documents.
• Creditors can only make claims for the share capital.
• Requirement for annual report (DKK 20-30.000).
• Preferred company type for early stage investors.
9 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

10. Exercise 1:
For each group:
Discuss which type of company would
be interesting for your group and idea.
you have 5 minutes!
Share conclusions with the class!
10 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

11. Resources
• At the website www.virk.dk, you can find a number of
relevant resources:
– Info on different company types.
– Overview of required documents.
– Descriptions of what to do when you get employees.
– ...
11 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

12. Other practicalities
- Before setting up a company, you may want to:
- Find a place to sit (Createch incubator?).
- Buy the domain name for your company.
- Set up e-mail
- ”...@hotmail.com” does not look pro
- Setup a phone system.
- Get business cards.
12 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark

13. 13 Original material by Jakob A. Bejbro Andersen for course 42629 – Innovation and Product 2012
Development Department of Mechanical Engineering, The Technical University of Denmark