The legal profession has a bad reputation. This is particularly true in the startup world. Some of this is well deserved.
Many startup attorneys take a one-size-fits-all approach to their new start-up clients. They want to structure your start-up in a format that will make it easier to ship you off to the Venture Capital firms with whom the attorneys have a long term relationship.
Unfortunately, this format makes sense for only a small, a very small, fraction of start-ups.
Most startups, even very successful start-ups, do not need to rely on Venture Capital money to fund their business start-up. Most entrepreneurs who rely upon Venture Capital funding for their start-up never get funding. And if the entrepreneur does get Venture Capital funding, that entrepreneur will find out that Venture Capital funding is the most expensive money the entrepreneur will find. There are lots of other funding options available to an entrepreneur today.
Up Venture Capital Creek Not Always the Best Path
In our experience, the ride up Venture Capital Creek does not benefit most startups. It makes no sense to structure a start-up for the ride up Venture Capital Creek when that is the least likely route to successful funding for your start-up. Entrepreneurs who structure their start-up for the ride up Venture Capital Creek will always end up spending a lot more money than necessary for a business structure that does nothing to improve the probability of their success.
Every start-up is different. Every entrepreneur is different. Every business plan is different. An experienced, ethical and honest attorney will structure your start-up in a manner that will maximize the probability of your success. That attorney is the attorney that founders should be looking for when they look for an attorney to help them launch their business. An experienced, honest attorney at an ethical law firm wouldn’t send you up Venture Capital Creek unless that was the right path for your start-up, and it is not the right path for most start-ups.Read More