All startups have something in common: they’re always trying to save money. As a result, it’s understandable that startups are reluctant in hiring an attorney. Startups are constantly under pressure to succeed without losing money, and this makes it essential to utilize lawyers that are beneficial to your startup and worth the price you pay for their services. Regardless if your startup has never hired an attorney, or has been using the same one for years, the following tips are helpful for companies trying to save some capital in the legal department:
- Do What You Can Without a Lawyer. With an abundance of free information on the Internet, startups can always do a little research to get a sense of their legal issue. This will help in selecting the appropriate attorney for your problem, and save money with asking unnecessary questions. Before meeting with your attorney organize your docs and make the copies ahead of time. Also, you should have something to refer to when you’re speaking with the attorney to foster an effective and time-saving meeting. If your company uses a “do it yourself” website to draft documents then make sure you run it by an attorney before implementing it. Boilerplate templates can leave important stuff out, which can cause problems down the line. A simple review by an attorney can shore up the inefficiencies for such websites.
- Go Small Rather Than Big. There are obvious benefits of having a small firm lawyer for your startup. Foremost, the attorney’s fees will typically be dramatically lower and the smaller firm market has a more competitive pricing scheme, thus bringing the cost down for the client. Also, smaller firm attorneys will be able to devote more time and effort to your legal matters because their caseload is significantly lower. Remember, you hire a person, not a firm. You may retain the finest firm in your area but every firm has great lawyers, good lawyers and some that are neither. You only get the lawyer you hire.
- Explore Alternative Fee Arrangements. Gone are the days that companies are at the will of hourly billing. Now, lawyers are offering alternative payment methods such as fixed, capped, contingent, hybrid, flat-fee and premium-based fee arrangements. Paying with equity is sometimes an option as well. These alternative methods can provide predictability and fewer fee disputes, which are especially appealing for General Counsels looking to outsource work. Don’t be hesitant to negotiate the payment structure or the price. Lawyers are aware that the legal market is saturated so if they aren’t open to changing their ways then you’ll find someone who is.
- Make Sure You’re on the Same Page. Agree in writing so that the expectations are clear. If you sign a retainer, understand what you’re being charged. Law has always lacked transparency. One of the most common difficulties for businesses that retain legal counsel is that they are unaware of how much their lawyer costs and the method of which they’re being charged. The legal world is changing though and attorneys are now expected to be clear with what and how you’re being charged.
- Reflect on Your Experiences. Does it feel like your attorney is taking a long time to complete the work? Is your attorney producing lackluster work? Have you been charged for quick phone calls or emails? Are legal costs higher than expected? It’s important to remember that you can always make a change when it comes to legal if you’re not getting what you expect and need. More on that here – When a Business Should Switch Lawyers.
Business owners no longer have to cringe when they think about lawyers. By following these tips, your startup can make mindful decisions that can save precious time and money.