Not all lawyers are created equal — and for an early-stage startup, the counsel you choose can seriously impact the course of your business.
From getting slammed with surprise fees to getting passed along to attorneys who don’t understand what makes an early-stage startup different from, say, an established corporation with hundreds of employees, the wrong lawyer can lead to painful results.
So how do you choose wisely?
To find out, we asked seven members of the Young Entrepreneur Council (YEC) to share the key questions to ask your potential lawyer before signing on the dotted line:
1. Do You Work With Companies Comparable to Mine?
I spent five years at Cooley LLP as a “startup lawyer” before becoming an entrepreneur, so I have a pretty unique perspective on what is important to consider when looking for a lawyer. Here’s the key things I want to know: Does he work with a lot of companies at my stage? If you are a startup seeking venture capital, how many other startups has he helped raise capital? If you are bootstrapping, how many of these companies bootstrapped? You want comparables. And just as important: Is he a teacher? You need someone willing to share knowledge.
– Eric Koester, Zaarly
2. How Do You Bill?
Understanding how your lawyer bills his time is a critical question — you don’t want to get hit with a surprise invoice. Don’t be afraid to speak up and ask for clarification on your questions. Consider that some lawyers bill for phone calls, emails, Skype conversations, their assistant’s time, research time, admin time, etc., so be sure to get the full picture before you invest.
– Kelly Azevedo, She’s Got Systems
3. Will I Be Comfortable Working With You?
As an attorney who works with young entrepreneurs, I know it’s important to my clients to feel they can relate to me. They are not intimidated by me or scared to ask me questions. This is very important when working with a lawyer. Your lawyer is a member of your team, and you need to feel comfortable working with him or her. I also highly recommend online law offices. These lawyers run their practices using secure technology online. They often offer reasonable flat fees (instead of hourly billing), flexible hours and convenient ways to work with them right from your home or office.
– Rachel Rodgers, Rachel Rodgers Law Office
4. What Is Your Focus?
Like many professions, the practice of law has become more focused in the modern era. If you are working in a metropolitan area, the answer to the question, “What’s your focus?” should never be, “I’m a generalist.” In any startup ecosystem, there should be practices (both large and small) that focus on entrepreneurship. Moreover, it is important that the corporate startup attorney who is helping you with your formation and contract issues knows at what point your needs are better served by bringing in a specialist, like an intellectual property, tax, employment or litigation attorney.
– Peter Minton, Minton Law Group, P.C.
5. What Is Your Past Experience?
Hiring a lawyer for your startup requires a lot of due diligence. You want someone with experience in your industry, who has worked with companies at your stage and has helped obtain the types of funds you will need to raise. You also want someone with whom you are comfortable and can build a close relationship. How would he deal with the different types of issues you might face? And what’s his philosophy on the relationship between the firm and its outside counsel? Talk to some of his clients that look and feel like your business — or what you want your business to be.
– David Ehrenberg, Early Growth Financial Services
6. Are You the Best in the City?
7. What Is Your Age and Experience With Technology?
Our attorney is a year younger than I am, and one of the reasons I chose him is because he is tech-savvy and actually uses social media. A lot of the people I interviewed were partners in big firms, and they really did not understand what we do. When they “deal” with technology, it’s with companies like Oracle and Microsoft. I needed someone who knew how to use Facebook and Twitter.
– Jim Belosic, ShortStack/Pancake Labs
The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.