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Startups

Your First Point of Failure in a Startup is a Bad Team

A key part of that team is your lawyer.

You have two concerns regarding legal operations as a startup founder. The first is that you don’t want to overpay for legal expenses that solve problems that haven’t arisen yet. The second is that you don’t have specialized legal knowledge, so you don’t know what you need, what you should get, and what value a lawyer provides.

We’ll explain what most lawyers provide, and contrast this with what we’re offering you. Most lawyers have a “startup package” in mind. This usually consists of incorporating your company, drafting a shareholder’s agreement, and providing various legal agreements that most businesses require (employment agreement, share vesting agreement, privacy policy, etc.). There may or may not be an initial intake interview, and this interview may be done by a lawyer or a law clerk. If you have questions, which you invariably will, the lawyer will likely quickly answer them in that initial intake interview, and hurry to get you through to payment and delivering the documents. If it’s clear that no further legal work will be coming from you down the pipeline, many founders have seen that future legal inquires are not given extensive time and energy by many lawyers.

It may be tempting to go with a big name firm. Perhaps you were recommended to them by your accelerator, another founder, or brought to them by a Google search. To these firms, you are a small fish in a big pond. They see startups as a high volume, high turn-over service category, where very few startups will transition into more traditional companies that can afford to pay big firm rates and require extensive services.  Flat fee services for them are low profit, and they are just waiting to transition into a billable hour service model where the big money is made. Some of the biggest firms pay tens of millions a month in rent for their bay street office towers, and their prices reflect this overhead. Startups fulfil a few purposes for these firms:

  1.  Firms can say they specialize in technology, as they work with startups. This “specialization” helps them attract established technology companies who may need millions of dollars in services;
  2.  A mostly boilerplate template agreement can be filled out by a law clerk or law student. This means that the $800/hour partner can touch the agreement in a minimal way and work on bigger things while you still pay a high price for your agreements.
  3.  A few startups will become large companies, and the firms are always competing for big companies. There is an assumption that the startups will retain the lawyers they started with, and this could potentially be in the retainer agreement as well. Until then, however, you are not a priority.

This isn’t to say these firms are bad. From a business perspective this all makes sense. A lawyer has limited time and an unlimited potential client base. Some clients will bring in more money for them, and they will therefore put more attention to those clients. High overhead costs require a minimum amount of profit to be made. Big firms also require lawyers to bill a minimum 1800 hours a year, and the lawyers need to get those hours somewhere.

You may also want a firm like this. Some venture capital funds (VCs) will want to see big names, and if you have substantial funding up front you may be able to demand the time and attention your business deserves. Startups backed by hedge funds or VC groups may also be able to leverage existing relationships these entities have with lawyers to get your business high-quality time and attention.

Why Us?

Our value proposition to you is a unique one: we provide unmatched value at a reasonable and predictable price. We charge you a flat fee upfront, and this gets you everything you need to get started. Every legal document, future edits to those documents, and any questions you may have, all included.

We go even further than this. We want your startup to grow into the next Canadian unicorn. So, we will discuss anything related to your business. We will identify weak spots, assess your growth strategy, help you assess technical employees to get your app built, and be a direct and honest provider of feedback and criticism. We’re not satisfied in waiting for you to become successful, we help you become successful as a strategic partner.

We can do this because we practice law differently. We are learning everyday, in many areas outside of law. We have kept overhead costs very low, so we don’t have a frantic dash to keep the lights on. We run our practice like a startup using automation wherever we can so we have more time to directly assist you. We take on a limited amount of clients so we can give everyone we work with 100% of our efforts. We are open to alternative funding arrangements, such as deferred payment plans, equity, an exchange of services, or whatever else you can think of that makes sense for both parties.

Above all that, we like doing this. We like taking risks on the underdogs. We took those same risks when we walked away from lucrative downtown salaries and started our own law firm. We love sitting down with founders and going through their business plans and giving real, practical advice.

We’re in business to help your business succeed. Our real business is you.

Let's Get Started!

Send us an email below describing your startup, where you currently are in your business, and what you hope to get accomplished. We’ll be in touch shortly!

Let us help you!

If you need any help, please feel free to email us and we’ll get in touch with you to determine if we can help you achieve your goals.

Info@drlawyers.ca

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