The Complex Relationship Between Entrepreneurs & Lawyers


Let’s face it. If you are an entrepreneur, you are a risk taker. You have to be in order to live with the uncertainty of where your next paycheck will come from. As an entrepreneur, you have to overcome numerous obstacles every day to ensure that your business will thrive and your employees will be paid. You have to push the envelope and bend the rules if you really are going to launch your business and make it a success.

Unless you are a trust fund baby or have friends that don’t care how you spend their money, building something out of nothing takes courage, creativity, innovation, commitment and generally large cacahuates. As Peter Drucker says, “The best way to predict the future is to create it,” and entrepreneurs are people who make things happen.

Although entrepreneurs are known to have unflappable work ethic, they are not rule followers. Part of being an entrepreneur is that there comes a time when you can no longer operate under someone else’s rules. We hate to be told constantly what to do and when to do it. Entrepreneurs were not born to punch the clock. I know this from experience. My ex-boss came into my office to have our bi-annual conversation about my arrival time to the office.

Ex-boss, “Jen, I’m here to talk about your hours. You know our law firm’s policy is that you adhere to the hours of 7am to 4pm?”

Me, “I know. You’re right, we did talk about that. It’s just that before care at my kids’ school doesn’t start until 7:30am and I need to be able to drop them off.”

Boss, “Well I can’t change company policy, so I’m going to need you to be here by seven am.”

It was the final push I needed. I took the leap of faith – with the heart of an entrepreneur and a law degree, I started my own company. Success is sometimes measured by a destination, but in my case it was taking that first action step in my journey.

In my journey of having my own legal practice, there is but one ultimate authority, the client. Face time is not necessary and highly discouraged. Productivity is high, overhead is low, and the client is the most important person, not the boss. Hallelujah!

Lawyers, by contrast, are risk averse. Many of us went to law school to get a stable well-paying job. The practice of law itself is all about reducing or allocating risk. Most lawyers who practice have never started their own practice or started their own business, and they have no idea what the typical business person goes through on any given day just to keep the doors open. In fact, most lawyers are confronted with the cases that result from failed deals which only exacerbates the lawyers’ fear of what can happen when the proper legal precautions are not taken.

Therefore, while lawyers are focusing on every potential situation that could hypothetically result in adverse consequences to the entrepreneur; the entrepreneur is busy trying to launch a business to pay the bills. The entrepreneur is focused on creating the business entity, developing branding, raising money, paying taxes, registering for business licenses, paying payroll taxes, filing tax returns, making your product or services, obtaining bar codes, quality controls, marketing your product or services, employing people, managing people, managing inventory, accounting for your sales, complying with government regulations, applying for licensing, selling your product or service, building your website, marketing and advertising . . . and the list goes on.

Most entrepreneurs who start businesses do not have unlimited funds, so hiring a lawyer for hundreds of dollars an hour only to hear them tell you all the reasons that what you are doing will not work and all the risks you are exposed to and all the ways that your business is going to result in a big fat law suit, is not appealing. I mean how important is it to spend hundreds of dollars negotiating an indemnification provision on a lease contract when you have hardly any money in the bank?

As an entrepreneur, you have to prioritize all the time where to direct your time and money.

This is why it is really important to find a business lawyer whom you can trust. Let’s face it, lawyers do provide an invaluable service, but it doesn’t feel good to be charged per email. If you want to succeed as an entrepreneur, you have to have a company that passes the sniff test: you have to comply with corporate laws, pay state and federal taxes, manage payroll, and take steps appropriate to protect the business that you are building. For example, taking the proper steps to make sure the name on which you are building your brand is not in violation of someone else’s trademark.

If you don’t solicit professional legal advice, and conduct a full trademark search of the name you want to use for your brand, you could end up spending lots of time and money on products, labels, packaging and displays, not to mention time and resources on branding, only to end up with a Cease and Desist letter from another company that holds a valid U.S. Trademark for that name in the same industry.

This could have been avoided by retaining a business lawyer for a little over a thousand dollars to do a thorough search for you, and that thousand would have saved you hundreds of thousands down the road. Same is true for any type of stock issuances you may want to do. There are complex state and federal securities laws that need to be evaluated for each stock issuance. Failure to follow these laws could really handicap your business down the road, especially when you want to raise money from sophisticated investors.

Therefore, take time to find a business lawyer you can trust and can ping with questions.

There are plenty of experienced, brilliant lawyers who do not work for large law firms and have the flexibility to work with entrepreneurs in order to answer questions or at least highlight potential pitfalls. In fact, some of us are the same as you trying to start businesses of our own.

For a lawyer to effectively partner with an entrepreneur, they need to have a shared understanding of the pinnacle of what it means to take risks and work hard. If creativity, fiscal responsibility and innovation are valued by both the entrepreneur and the lawyer, maybe the relationship isn’t so complex after all.

Jennifer Clifton, business attorney at Viewpoint Law Group, 458-206-9440, and President/CEO of Lava Love, LLC, Lava Love is a line of spa products made from the volcanic ash from our Oregon volcanoes right here in Bend, Oregon.


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