Lawyers, lawyers, everywhere!

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Last week’s adventure was tracking down a lawyer. Why do we need a lawyer already, you ask? Well, in the short term, we need help forming the company, drafting articles of organization, drafting NDAs, etc. Couldn’t we do this ourselves? Sure, but I’d really hate to find out I screwed up some crucial detail in 6-12 months when we’re, say, trying to get investors.
On a more general level, it’s probably good to get a lawyer earlier rather than later. Right now, I can take my time to meet with a bunch of different lawyers and figure out which one will be a really good fit. With any luck, I’ll find someone who not only gives us sound legal advice (e.g. “Stay clear of the RIAA/MPAA, they’re out of their freaking minds”), but can also be a general adviser for our business and help us network with other advisers and potential investors. If I waited until I really needed a lawyer (either in a good situation, like we have an investor who wants to give us a bajillion bucks, or in a bad situation, like we’re getting sued), I’d probably ending up picking someone more or less at random, which rarely works out well.
I’ve never really talked to lawyers before, so this week was quite an experience. The firms I met ran the entire range from a very small firm with only a virtual office to a huge firm with a 24th floor office overlooking the city.
I’m certainly no expert, but here’s how I approached the meetings. First, I explained our general situation: my job experience, my co-founders experience, and how this is our first startup. I explain that I’m working full-time, but my co-founder is moonlighting (bonus points for the lawyers who dig deeper into the moonlighting issue to see if we’re at risk. I’m 99% certain we’re fine, but it’s nice to see they are listening and looking for issues). Then I explain what type of software we want to build. We usually talk about that for a bit. I know all talks between a lawyer and I are privileged and confidential, but, rightly or wrongly, I tend to just give them the vague outlines of what we want to do.
After that, I generally explain what we’re looking for in a lawyer, which boils down to three things:
1. Someone who has worked with small businesses, in particular small tech businesses (and has helped them grow and get funding)
2. Someone who understands we’re on a budget. This doesn’t mean “we want the cheapest hourly rate.” First of all, a cheap hourly rate doesn’t necessarily mean you’re getting cheaper service, since someone charging less may be less qualified and take longer. But more importantly, we’re willing to pay for quality work. What it does mean is that we want a lawyer who looks for other ways for us to save some money. For instance, can we fill out certain forms ourselves and have the lawyer just look over them? Are there flat fees for certain tasks? Will they suggest ways to use our time together more effectively, so we can save time and money?
3. Someone who who gives our business the attention it needs. I don’t expect that we’re going to have legal issues that require incredibly quick turnaround, but we do want a lawyer who can get back to us promptly. Even more importantly, we want someone who isn’t too busy just to sit down and chat about our business on a monthly basis, even if we don’t have specific legal questions.
I generally lay all that out and then we talk for awhile about how and why they would be a good fit for our company. Towards the end, I always ask for references, specifically technology companies that either are very small, or were very small and have grown larger.
Starting today, I’m going to start contacting those references. Here’s my tentative list of questions
1. How long have you worked with Lawyer X?
2. What kinds of legal services has Lawyer X provided you?
3. What’s the best part about working with Lawyer X?
4. What’s the most frustrating experience you have had with Lawyer X?
5. Overall, how happy have you been with the legal services you’ve gotten from Lawyer X?
6. Isn’t “Lawyer X” the most badass name for a lawyer ever?
Hopefully, this will give me a pretty fair picture of the overall experience of working with each lawyer. Anything else I should be asking? Any warning signs to look for when considering lawyers? And given how sue-happy this country is, does anyone want to put bets on how soon we’ll be getting sued for something?

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2 Responses to “Lawyers, lawyers, everywhere!”

  1. Aaron Says:

    Do you have any concerns about using the same lawyer as one of your competitors or investors?

  2. Ben Says:

    To be honest, I hadn’t really thought about it too much. There is the possibility of a conflict of interests, especially if the lawyer is representing our competitors, but I think the only way to avoid that is to clearly explain the product/service to your lawyer, so they can determine if there is such a conflict.
    The lawyers I have talked to have been pretty vigilant about those types of things. For instance, most of them asked what company my co-founder currently works for, because they couldn’t take us as a client if they already represent his current employer.

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