How to choose the right lawyer for your Start-Up?

Nimrod Vromen, Partner at Yigal Arnon & Co. | Reading Time: 6 min.

Nimrod Vromen Adv., who specializes in the start-up field and is a partner in the start-up department of the Yigal Arnon and Co. law firm, explains the built-in tension between entrepreneurs and their lawyers and provides tips and recommendations on how to choose the right lawyer for your project. 

A silent war takes place between the Israeli start-up founders, who wish to climb to the world's high-tech top, and between those who are supposed to protect them legally along the way. The accessibility of information and the intensified criticism from the entrepreneurs versus the prestigious reputation of the lawyers, creates a collision course whose end is pending an inevitable change. 

"There is a war between the clients and the lawyers," admits Nimrod Vromen Adv., who specializes in the start-up field and is a partner in the start-up department of the Yigal Arnon and Co. law firm. "Lawyers want to sustain the lifestyle which they have built for themselves and that is what they want to preserve, the ivory tower. Fifteen years ago, if you would have gone to your lawyer and asked for a Non-Disclosure Agreement, without truly understanding what it does and how much effort it demanded, you accepted his financial request – even if the lawyer had demanded 600 dollars, and even if it only took him five minutes to prepare. In some respects, it was justified because the agreement was genuinely the property of the lawyer. The technological revolution has caused customers to accumulate knowledge and sophistication. In one instant, thanks to the Internet search options, the clients understood that the lawyer could use the documents he already had, and reach a higher quality of legal products much faster. Hence the expectation of paying a great deal less. 

The Lawyer's Hourly Model is Challenged

The world of entrepreneurship connected with Nimrod Vromen after his military service; while studying law, he established with his good friend a start-up. The company survived only two years, but the occupation of it, caused for a passion develop for the field, from the business and legal side. As part of his activities in the world of start-up and technology, Vromen founded and manages the content on the site, which is used as a platform of tools and content for entrepreneurs and the members' club TechHouse. After over a decade as an advocate and extensive activity in the field that included the representation of hundreds of companies, many of them from their first few stages until their shining exits, he realized that the legal world needs to become more efficient. 

"Once a law firm existed from several flagship clients. Today you cannot afford that. You have to work on quantity and hope to get bid deals from there. This situation is challenging the hourly model that lawyers are so fond of, and requires those who are involved in the field to become more efficient," he explained. "When a start-up walks through my door, I cannot except to charge him per hour. If I charge him a few hundred dollars for an hour's work – this is money that he cannot use to pay a developer or designer or money that will not go to pay Facebook in order to obtain users. The start-up needs to spend money on what will promote him towards raising more capital, otherwise the venture will go down the drain. 

Experience, Permanent Staff, and Coordinating Expectations

So how can you still find a suitable lawyer for your start-up? Adv. Vromen responds to five basic questions and connects each question with a short answer.

1. On the technical level – how do you find an attorney today?

Do not underestimate "word to mouth" and Facebook groups. One needs to search the Web for recommendations on specific attorneys – and not go to the firm's offices and rely on them to provide you with a respected lawyer. Today, you can search in Facebook groups for recommendations for lawyers and narrow down the list to the five lawyers who keep appearing in the recommendations. When meeting with them, ask for references to companies they represent; see who at the end you click with." 

2. Quantity and not "quality"

"There is an inaccurate perception that lawyers who sign large deals are certainly better. However, lawyers who are suitable for large companies may not necessarily be suitable for start-ups. A lawyer who is appropriate for startups is one who has ample experience in many cases, and has worked with as many companies as possible. In such a case, it is more likely that he will (i) know what the industry standards are, (ii) have a wider range of documents to access (iii) know how to handle the situation better, on the basis of other deals that he has made in the past."

3. What's better, a boutique firm or a large firm?

"It is better to receive services from a large firm. In a large firm, even if there are a bunch of lawyers who work with start-ups, there are also lawyers who work with large companies. That way you get the perfect combination. When I give you an answer in two minutes, you can trust me that I drew it from my accumulated experience. But if I had any doubt, I would approach my partner who represents huge corporations and ask for an answer, which would be a result of a long examination."

4. How can I tell if a lawyer is fair with me?

"If the lawyer feeds on start-ups, then there's no way that he is unfair. One mistake with a client would ruin him. This lawyer already has enough data in order to tell a client how much it will cost, and if he does not know – then he is not there yet. There is a direct connection between a lawyer's experience and his ability to estimate costs. Beyond that, the lawyer should be willing to postpone your legal debt until the fund raising. If he is not willing, that means that he does not deal with start-ups or that he does deal with them but he does not believe that you will be able to raise funds and therefore he wants to charge an hourly fee."

5. I found a lawyer, now what?

  • Make sure that the legal staff who works for you is fixed. If the team changes, or if the lawyer is not permanent, it is likely that you will pay for the training period between them. 
  • Make sure the partner is a partner in the process. If the lawyers are copying him on the e-mails, that means that there will be quality control done by him. If not – it is likely that they "threw" you and decisions are made without the partner. However, you would want some tasks to be done by young attorneys, and not necessarily the partners, especially if these are routine tasks, in order to save costs.
  • Honor Shabbat and Holidays. Also the team working for you deserves a vacation, and if their responses are not immediate, that is probably because they are busy on countless other short tasks which have piled up.
  • Coordinating expectations. You need to coordinate with your lawyer or team what's urgent to you as a derivative of the true urgency of the tasks.

Nimrod Vromen is a Partner at Yigal Arnon & Co. with 10 years of experience in representing Startups, and is CEO of YTech Runway Ltd.

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