), I encourage startups to take their head out of the sand and execute on the legal aspects of their business to their advantage.
While I am currently am in the field and focusing on AG-tech/AG-business/VC and litigation, I notably have been associated with Food Related Startups, Privacy Startups, Medical Startups, and both SaaS and Zebra Startups.
I love untangling business models and the associated legal and make them support and work together. As a result I am at the contact between Startup and the VC model, both of which deserve to be disrupted.
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I provide these resources in conjunction with my pro bono work with
, Startups tend to take the “easy” solution when it comes to legal execution.
Like technical debt, this “
legal execution debt
” imposes a non-obvious cost, namely:
the implied cost of additional rework caused by choosing an easy (limited) solution now instead of using a better approach that would take longer or might be more expensive in the short term (but less in the long term).
Unlike technical debt, it isn’t just future cost that a Startup occurs when it adopts this legal execution debt. Startups also (and more importantly) unknowingly adopt booby traps that may render them “dead on arrival”.
Why does legal execution debt occur? Generally when people ignore that legal is a way to execute on product (and ignore what is the product they are selling).
To give context, Here are some common rationalizations that lead to legal execution debt. When they are combined with the example it yields a
red flag to most attorneys.
“X is better than nothing at all”
is confused with “
this is what you need to do”
Founder’s Agreements written by Founders.
believe themselves to be much smarter
than ... almost everyone (including other business people), but especially attorneys, after-all that is why they are the client and attorneys are merely attorneys.
: DIY or SaaS formation of legal entities; and contracts (like ToS).
When the getting funding is the priority, rather than making money sustainably.
I’m a technical person who is entrenched in startups, I know what to do. Every Startup has the same legal problems.
: Current Employment Agreements (Daytime Job) and IP.
While I tend to educate clients about legal execution debt, many do not. It is my goal in this resource page to have that discussion with you, the reader, so that you can understand the risks you take, and perhaps more importantly,
how to cost effectively blunt that debt and take the appropriate measures to actually increase your opportunities for innovation
It has come to my attention that great minds think alike. Who knew? Here is
on “legal technical debt” (still like legal execution debt better and my over 10 year stint of using it probably won’t change in the future). As we say in r/startups, it's nice to see that others have validated the dorky concepts I use professionally. Check it out.
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