As a practising startup lawyer, I can only imagine the challenge faced by founders when they have to look for a good startup lawyer.
In my interaction with many founders, they still cite legal fees as a big issue why they don’t engage a lawyer or even run away when someone gets introduced as a lawyer (true story for me).
Firstly, I really don’t think lawyers are that expensive (more on this below). In this post, I’ll share some quick questions that founders can ask to see if a startup lawyer that you plan to hire may or may not be a good fit for you.
1. “What type of startup legal work have you done before?”
Firstly, I should clarify that there’s no such thing as a “startup lawyer”. So many people before me have written about this already so I won’t bore you down by repeating the same thing. In essence, “startup lawyer” is just a marketing phrase used by commercial lawyers to denote or suggest that they may have some experience in working with startups. There isn’t any course or additional legal skills that may be required before someone is able to proclaim him or herself as a startup lawyer. Silicon Valley tried to disrupt legal services but that didn’t work so well too.
In light of the above, since there’s no really a good way to know if someone is indeed a specialist startup lawyer, it becomes so crucially important to really do some due diligence before hiring a lawyer.
Simple research like doing Google search or asking for testimonials or referrals from your fellow startup founders will be crucial and useful to verify experience by a startup lawyer.
Ok, since you’ve been with me still so far, I’m going to share with you a little secret. In Malaysia, many lawyers do not charge an initial consultation fee. In other words, the first meeting or call is usually free.
Also, don’t quote me on this as well and you should still ask the lawyer before meeting one (but really honestly, in my practising life, I have not heard of any lawyer that charges for an initial meeting).
2. “What is your fee structure for startups?”
Nowadays, many law firms have ‘startup-friendly’ package. Some law firms work with early-stage startups at substantial or discounted rates to build long term relationships in hope that the startup would do well and continue the legal work. Again, do speak to the law firm and see if they can offer a “startup-friendly” package for you.
Again, if you are still undecided on which law firm to hire, don’t be afraid to tell them that you’re still “lawyer shopping”. Keep on talking to potential lawyers until you find someone that fits your budget and really understand your needs (since initial consultation meeting is free anyway).
3. “Do I like this lawyer as a person?”
Ok, just because this may be the last point does not imply that it’s the least important.
Like any type of service business out there, you should only work with someone that you enjoy or trust.
Look at it this way. Building a startup as a founder is already a tough challenge. The last thing you want to happen is to get stuck with a legal counsel that keeps on hovering around your neck with compliance issues. Compliance is a big thing for businesses but that is not the only thing. Balancing business and legal interests which means being practical and progressive when giving legal advice can be an inherent challenge even for most senior lawyers.
Again, don’t get stuck with a lawyer that you don’t like (no matter how good the lawyer might be!).
Hiring a lawyer can save a lot of headache in the future and gives you more leverage when you negotiate with investors or third parties. A good startup lawyer can help you identify legal issues and avoid costly mistakes.