Many would suggest the characteristics that make for a successful lawyer are completely opposite those that make for a successful entrepreneur. Successful lawyers are perceived to be risk-averse, follow convention, and strive for predictability. Successful business leaders, on the other hand, are viewed as pursuers of risk, strive to be different, and navigators of chaos. While there are always exceptions to such sweeping generalizations, it's fair to say they are generally true in large measure.
Ironically, building a successful business requires a blending of these polar opposites. What many entrepreneurs fail to realize is the degree to which every business decision they make can influence their ability to succeed. It starts with making a choice of legal entity for your business, and continues through to the details you cover within the contracts your business signs. For this reason, involving an attorney early in the process of building your business (and integrating their input into your key business decisions) is truly critical.
Unfortunately, with most attorneys and firms still charging for their time by the hour, it is usually impractical to follow such a course. And even if your attorney's billing practices or your financial resources allow for you to build legal insight into your daily operations, the "character" differences between entrepreneur and attorney can often wreak more havoc than it might otherwise prevent. The key to avoiding this latter pitfall lies in both you and your attorney's ability to properly "manage" each other's roles.
The first step to effectively managing this professional relationship lies with making an effort to understand the mindset of each role. Starting with their first class in law school, lawyers are trained to identify, plan and prepare for worst-case scenarios. We learn the law by studying terribly bad situations that have wound up in court (the reality, however, is less than 1% of claims, disputes and "bad results" ever make it into the courtroom). Our training is exclusively focused on eliminating risk, and finding ways to maximize "damage control" if and when things do go wrong.
Entrepreneurs appreciate that a successful business is not built on eliminating risk. We realize too many customers, partners, and opportunities would evaporate if we "wasted" time tweaking every potential deal to eliminate risk. Too often, however, the business owner will embrace unnecessary risk in the pursuit of the deal.
So how do you successfully blend this marriage of opposites to make for a successful business? By realizing that just like any other aspect of running your business, it's up to you to manage the relationship so can maximize the value of what you're paying for. To this end, some key considerations:
There's more we could say, but it all comes down to striking the right balance between managing risk and accelerating your business objectives. Successful business leaders understand how to do this. It's not easy for the uninitiated, but well worth the effort.
And now for our shameless plug :: if you want help navigating this process, it's one of the many services we bring to our client companies. Give us a shout 😉
Jack Speranza is an attorney, software engineer and entrepreneur. For 15 years he has helped his companies and clients strike the right balance between risk and reward by weaving good business, good technology and good law into new services and operations.