Every startup is vastly different, but the one thing they have in common is they will flourish with the help of a California business lawyer. A business attorney can help create a clear legal framework for your business operations that will help avoid lawsuits and make it easier to stay compliant.
Where many new entrepreneurs struggle is finding a quality business lawyer for their startup. There are so many attorneys, especially in California, and it is hard to know how to choose the right one. In this article, a business dispute attorney in San Diego at the law firm California Business Lawyer & Corporate Lawyer shares the criteria and steps you need to find a suitable startup lawyer.
Create a Set of Criteria
You need to create a set of criteria unique to your business if you want to find a good fit. We will provide you with some guidance on where to start, but you need to have a think about your business’s needs. The Nakase Law Firm employment attorneys San Diego businesses trust share a set of criteria for hiring an attorney as follows:
Firstly, think about what types of legal help you might need and what you can handle yourself or with the help of another professional.
Need the help of a business lawyer
Handle yourself
- Reviewing and advising on contracts
- Advising on business entity types
- Creating and enforcing partnership agreements
- Creating employment policies and practices
- Preparing to raise venture capital
- Protecting intellectual property
- Preparing to bring in investors or shareholders
- Settling business disputes
- Advising on civil or ADA lawsuits
- Hiring staff
- Managing payroll
- Bookkeeping
- Choosing a business name/logo/domain name/location
- Writing a business plan
- Applying for licenses and EIN
- Doing taxes
- Filing formation papers
Next, you need to determine which areas you might need the most legal help. Think about your main business operations and the way your business is set up. For example, you might need your business lawyer to have the skills and experience needed to help your franchise. You may need a business attorney with intellectual property protection expertise. If your startup needs a large number of staff right away, you might want a business lawyer with employment law expertise. Write down a list of the priority skills you need the attorney to have.
Do not just create skills or experience-based criteria; think about the type of lawyer you would be willing to work with. What types of communication methods would you prefer? Do you want a lawyer that’s funny or serious or somewhere in between? Think about the type of people you work best with and create a list of attributes you would like them to have.
Research Local Startup Lawyers
Using a combination of Google and online legal directories, find local business lawyers who possess some of the skills you identified when setting your criteria. They do not need to have all of the skills you require; in fact, it would be rare to find that, but they should have at least one or two. Research the attorneys you come across by looking at reviews from their clients and any industry news that mentions them. If they are part of a law firm, read into the law firm too, you will be working with them as much as the lawyer.
Another great way to find a business lawyer is by talking to other small business owners and getting a referral. Ask them who they have worked with in the past and why they were good/bad to work with. When you receive a referral, you get a lot more information about how the lawyer works and what they are good at and bad at. You should not just automatically hire a lawyer based on a referral though, make a shortlist of at least three business lawyers (ideally more). Meet each of these business lawyers by booking a consultation and getting to know them.
Do All Business Lawyers Work By The Hour?
Not always. There are a number of ways a business lawyer might bill you for their help. An hourly rate is the most common way a business lawyer will charge you. The startup lawyer will often keep you appraised of their progress and how much time they have spent on a particular task as they go. Often they may explain what is slowing things down and ways to speed up progress if there are any.
A similar way of charging clients is a retainer agreement. The business lawyer charges their client a monthly fee to “retain” their legal assistance. This means that the lawyer has a certain number of hours set aside for the client’s business and will answer communication quicker. The client is paying for their lawyer to be available to them if they need legal assistance. If they do not need legal assistance that month or do not use their allocation, they still need to pay the retainer.
Some business attorneys, especially those working with new businesses, may have a set rate for some of their services. This is often only applied to routine tasks that are simple and do not vary much in the time it takes to complete. Startups prefer this because they know how much to budget for their early legal needs, and their lawyer might even offer bundle prices.
If you are filing a lawsuit where you will win compensation if you are successful, then your business attorney may charge a contingency fee. Their payment is contingent on winning your case, meaning if you lose, you do not pay any lawyer’s fees. They instead take payment as a percentage of the compensation you win. This only applies to litigation where there is significant compensation or damages to win.
Questions to Ask a Potential Business Lawyer
Now that you have your criteria, your shortlist, and know a little more about how lawyers’ fees work, it is time to book a consultation with each of the potential business attorneys. Pay attention when booking the free consultation; evaluating these lawyers and law firms start now. Is the booking process simple or more complex than it needs to be? Is the receptionist polite and warm, or are they rude? Do they send reminders? You can learn a lot about how a business lawyer or law firm works before you have even visited the office.
When you meet the business lawyers, ask them a set of questions that will help you to decide who is the most suitable. Prepare these in advance so that you can use the consultation time wisely. Here are some examples of things you should ask them:
- What experience do you have with businesses like mine? Tell them a little bit about your business structure, industry, and products you sell and ask them if they have experience with companies like yours. They may not have worked with the exact combination, but as long as they have worked with a number of similar companies, they will be able to help. Different industries may be exempt from some laws or have tighter restrictions, so it is beneficial to have a business lawyer who has worked with some similar businesses.
- What are your areas of expertise? Find out what types of law this business lawyer specializes in. Write these down so you can compare them to your list of criteria later.
- If I face an issue outside of your expertise, do you have a strong network of expert lawyers you can refer me to? Your business lawyer will not be an expert in everything, and sometimes you might need specialist help. In these cases, your business lawyer’s network is an asset. It will save you having to spend time searching for a lawyer if your business lawyer can hire one for you and get them up to speed.
- How do you communicate with clients? Communication style is an important and often overlooked factor. If you prefer to correspond via email with the occasional meeting if you need a better explanation of something, you are not going to gel with a business lawyer who prefers to call their clients. The constant interruptions will drive you crazy. Hire a lawyer who has the same preferred communication style as you or is at least happy to communicate the way their clients prefer.
- Do you spend time educating your clients? A good business lawyer will spend time creating resources for their clients to help them succeed. This may be articles on non-legal business tasks or even sending email updates about new law changes. Find a business attorney who will be in touch and keep you updated about changing legislature to ensure you are compliant.
- What are your fees? Don’t be afraid to talk money. Your budget is just as important when choosing a business lawyer as their skill and experience. Make a note of how much the lawyer charges and what fee structures they use so that you can compare the cost of working with them. Make a note if they prefer their clients to hire them on retainer or just charge hourly.
- Do you see possible conflicts of interest? A conflict of interest may occur if they work with one of your competitors or suppliers. If you ask them to review or negotiate a contract on your behalf, they cannot represent both sides in the deal. The same goes if you file a lawsuit against one of their clients. This information is vital to know in advance as you should avoid conflicts of interest where possible. Your business lawyer will be privy to lots of confidential business information.
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