SHARING IS CARING: Why you should share everything about your business if you care about it
Note about the author: David Lutz is a Student Attorney with The Entrepreneurship Clinic and the Founder of BriefCase. (www.thebriefcaseapp.com). His dual role creates a unique perspective into attorney-client dynamics. A special thanks to Jesse Thomas (@JESS3) for allowing the use of his Startup Mixology Infographic.
It seems obvious, if not downright unnecessary to discuss, yet attorneys often find themselves being the last to know about a new development with their client’s business. In this post I will discuss some potential reasons for this ongoing conundrum and suggest why you, the entrepreneur, need to be proactive in your relationship with your attorney in order to receive the best representation.
Cost is no excuse in a clinic.
If you are being represented by The Entrepreneurship Clinic or another clinic for that matter, you are receiving legal services at no cost. Our waiting list alone demonstrates how amazing that is. I mention this because it is understandable that an entrepreneur paying for legal services may not want to share everything in an effort to save time and ultimately money. However, “understandable” does NOT mean wise or prudent. Furthermore, it is not understandable why a client of a clinic might not share all of the details of his or her business.
Excuses lead to consequences.
1) Entrepreneurs forget: I get it. Entrepreneurial time makes dog years seem slow, so what happened months ago might as well have been years ago. A good attorney will ask a lot of questions to understand the progress of your business and jog your memory. Sometimes these questions will seem annoyingly detailed, almost painfully so, but often the answer to your question today lies within a decision made in the past.
Entrepreneur: “Can I issue restricted stock?”
Attorney: “What progress have you made since you formed your business?”
Obviously, the second question has many layers associated with it. Trying to think back a couple months is extremely difficult, so the earlier you involve your attorney the better he or she can understand your business and answer your most pressing questions.
2) Entrepreneurs make decisions on what is important: It is easy to think of an attorney as another service provider, but this would be unwise. Some service providers have relatively un-nuanced tasks, the kind that can be completed with templates and set pieces of information. When working with those services it is easy and understandable to try to anticipate what information will be needed to accomplish X task. In stark contrast, legal services live squarely within the realm of nuance. It is foolish to omit information about your business in an attempt to anticipate what is or is not important. When in doubt: share. The legal ramifications of an improper hiring decision, for example, can quickly snowball into a serious issue in the life of a young company. So again, share early and share frequently.
3) Entrepreneurs are busy: I am not sure which is more dreaded, meeting with your attorney or going to the dentist? You’re busy, overworked and underpaid, so it makes sense that you might apply the “rip the band-aid off” mentality to meeting with your attorney(s) and try to make it quick. Maybe you think that the legal issues your business faces are such a small part of your startup that they can be put off? See Startup Mixology Infographic above (http://jess3.com/startup-mixology-infographic/). While the olive sitting on the glass may seem somewhat insignificant, the foundations of your business, including strategy and problem solving, are affected by numerous legal implications. Ever-present legal implications are enough of a reason to reach out to your attorney with new business developments as or before they occur.
4) Entrepreneurs are protective: Information about your business and strategy could have a large impact if it were to find its way into the wrong hands, so it makes perfect sense to be cautious. However, an overabundance of caution, especially in regards to your relationship with your attorney, can be harmful. Fully understanding the attorney-client relationship and associated duties (ie. duty of confidentiality), should relieve your concerns about sharing. There are plenty of blog posts explaining the duty of confidentiality (ie. http://www.sgrlaw.com/resources/trust_the_leaders/leaders_issues/ttl5/916/) and Student Attorneys with The Entrepreneurship Clinic spend a considerable amount of time early in any client relationship to clearly explain it. As entrepreneurs it is important that you understand the dynamics of the relationship, its associated duties and that the ultimate client is (typically) the company, not you. A clear understanding of the relationship in addition to an acknowledgment of the complexity of any legal question will allow your attorney to provide the best representation possible.