First up for this edition of the Five by Five is Professor Jeffrey R. Cornwall, who holds the Jack C. Massey Chair of Entrepreneurship at Belmont University. Professor Cornwall has written four books on entrepreneurship and writes The Entrepreneurial Mind weblog. From the Professor:
1. “Invest” in your Clients. By this, I don’t mean that attorneys should literally become equity investors in the entrepreneurial companies with which they work. But, they may need to “eat” much of what would normally be considered billable hours when first working with a start-up company. During the time before the business actually starts creating revenues through the early stages of business development is when many key legal issues need to be addressed. Shareholder agreements, patents, financing agreements, leases, employment contracts, etc. all require careful business and legal consideration. Yet, many entrepreneurs are strapped for cash. By offering heavily discounted fixed prices for such services, or by discounting hours billed, the attorney can actually make a major contribution to the early success of the business. The attorney will reap the benefits of this in the longer term as the company grows and its cash flows become positive.
2. Talk openly about fee structure for any project and work within their budget. Even as a business grows cash flow and budgets can remain fairly restrictive. Work with your entrepreneur clients to give them the most value for what they can afford. Offer them a fixed project cost rather than open ended hourly billing.
3. Develop a long-term legal plan. Work with your client to develop a long-term legal plan so they can plan for legal expenses that they will need to consider into the future.
4. Help your clients to make you more efficient in your work for them. Let them prepare their own drafts on documents. This can save a lot of money and will result in documents that better reflect their business and their strategies. Encourage them to organize their meetings with you to help make each meeting more efficient by covering several issues at once.
5. Help them to understand your world. The world of law is where you live. However, it is a scary, foreign land to most entrepreneurs. Help to translate what you are addressing with them into language they will understand. It is not the precise and technical way of dealing with clients in which most of you are trained, but it will lead to better outcomes for all concerned