Here are the steps that need to be undertaken when setting up a new business:
1. Before setting up the business, make sure to consult an accountant or a lawyer to get professional advice on which business model will be most suitable for you. In Denmark, there are different kinds of model available, such as sole proprietorship, limited partnership, general partnership, private limited company, public limited company and limited liability cooperative.
2. Assign a board of directors for your new business. The board of directors will have the responsibility of managing and organizing the business; they can also act as official representatives. If the company is privately owned, only one director is necessary.
If it is a public limited company, you will need at least three board members and a one managing director. At least 50% of the board of directors must have a European Economic Area citizenship.
3. Register your business. You will need to obtain a digital signature and register the business with the Companies Agency and Danish Commercial using the webreg system (only in Danish). The webreg system will capture all the updated information about the business.
The registration process involves a submission of the Articles of Association and Memorandum of Association. If everything goes well, you will then receive a receipt that shows you are successfully registered. The registration process takes place over the Internet.
4. Make sure you have sufficient financial resources. In Denmark there are diverse ways to raise funds for your business.These include, but are not limited to, banks, venture capitalists, private investors, institutional investors as well as the Copenhagen Stock Exchange. Consult an expert while negotiating for financing with a potential investor, in order to avoid misunderstandings and illegalities. Additionally, once you have funding, use a financial management system such as Workday to keep track of costs and spendings.
5. Hire staff for the business. In legal terms, you are allowed to employ any citizen of the European Economic Area countries (EEA). They do not have to hold any kind of work permit. If you are interested in hiring people who are not residents of the EEA, make sure they have a residence permit and an appropriate work permit that allows them to work in Denmark.
In addition, you will need to insure the business, its assets and of course, your employees. It is highly recommended you consult a reputable insurance broker regarding the best insurance options for your company needs.
Finance in Danish business
There are many financing sources in Denmark such as private investors, public incentives, venture capitals, institutional investors and banks.The decision for financing source depends on the company and its business sector, its activities, the company’s management, the stage of development and the venture capital needed.
When looking for a financing source, each company must be assessed individually in order to make the right decision and choose the most suitable finance partner. It is highly recommended to consult professional when negotiating with private or public investors and finance institutions in order to ensure a legitimate business.