The legal building blocks of the ecosystem

Lebanon is an awful place to start an innovative, new business venture – from a legal perspective, at least. There are a few general rules that apply to startup companies: 1) Around 90 percent are expected to fail; 2) Founders typically have no cash, investing all they have (and all they can raise) into the business; and 3) Founders typically have no assets (especially in the earliest days of the business), making traditional bank loans all but impossible as a fundraising option. While Lebanon’s startup ecosystem is growing by leaps and bounds compared to 10 years ago, the country’s commercial code – established in 1942 – is in need of updating, ecosystem stakeholders report. Archaic regulations make starting up costly, and a labyrinth of administrative procedures mean closing a failed business can take years. Young companies hoping to attract investors by offering preferred shares or trying to lure top talent