Legal Eagles Revisited

Last year, I wrote a piece about things to consider when selecting company counsel for your start-up so I felt compelled to briefly revisit the topic after reading some very insightful musings from Jason Mendelson from the Foundry Group (appropriately titled: Why Start-Up Lawyers Frustrate Me). Jason is another recovering-attorney-turned-VC like myself, so I encourage you to read his rant.

One of my current frustrations is when a portion of my fund’s investment in a company goes to paper the transaction and pay said start-up’s past legal bills. I realize it is a necessary (evil) for a number of reasons, but it doesn’t mean I have to like it. To add to this frustration, I’m beginning to think that the time spent going back and forth on “non-material” terms is an even bigger disservice to the company than the fact that a portion of it’s first institutional investment is going to pay for legal fees.

So, what’s a conscious entrepreneur to do when choosing counsel? First, read my prior Legal Eagles post. Second, choose wisely. Finally, understand the situation and manage counsel accordingly.