How can Solicitors help Entrepreneurs?
I’ve been building businesses for 30 years. The last 20 of these have been within the UK Technology Industry. I’ve been part of a Management Buy-out, mergers, acquisitions and an IPO on the London Stock Exchange.
Over the last 9 years I’ve been based in Cardiff. Looking back over this time, Capital Law has been involved in, at least, 10 of my transactions. Solicitors have been involved in every step of my business life; sometimes they’ve even been helpful.
Solicitors have a unique position in the lifecycle of any business. They are typically there at the birth, core to the first engagement with customers and financiers, and, quite often the last around at the funeral.
Whilst other advisors, particularly accountants, get to interact regularly with the business, solicitors have a unique relationship with entrepreneurs. It’s a role they don’t always appreciate or fully develop.
It’s not all about billable hours
Solicitors generally take a passive, reactive role. They’re there when the client needs them. Clients feel, and can almost hear, the billable time clock ticking. This hardly seems a partnership.
Their opportunity is to become a strategic advisor throughout the lifecycle of a business. Solicitors should understand the objectives, goals and motivations of both the business and the entrepreneur.
Every entrepreneur thinks their experiences and their business model are unique. Solicitors know this is not true. It’s just a matter of where you are in the development of your business. A product or service is always the same. They require suppliers, production, customers, distribution and payment. That’s true whether it’s a software product, a consultancy service or a metal-bashing manufacturer.
Solicitors should see their role as a non-executive advisor, offering impartial, supportive advice and oversight. The opportunity is to be part of the business leadership. The involvement should be little and often, aware of the short, medium and long-term goals. They should appreciate and contribute to the journey.
There is more to legal services than paperwork
Businesses look to their legal service provider to be there for the clerical, secretarial role. But they view this as routine. No one gets why anything needs to be “drafted” from scratch. Surely it’s all just cut and paste!
All business is really about removing inefficiencies. They do that by building a better product or service. If you are just providing the same as someone else, it’s a commodity. Commodity pricing means a race to the bottom in pricing unless you can control the total supply and the market channels. The legal profession may well control the supply, but within the market there are plenty of choices.
So Solicitors objectives should be clear. Remove inefficiency. Most agreements are pro forma. They’re there for when things go wrong. Often they never get read or referred to again. Business is mostly about personal relationships. Once you are resorting to the details of clauses and schedules agreed to in the past, requiring re-interpretation, the relationship is probably over.
What can you do to help Entrepreneurs?
Solicitors are in a unique position, have a unique perspective and a unique opportunity to help entrepreneurs.
Solicitors need to promote themselves as partners to business. They need to prove themselves impartial, supportive and aligned. They know that what entrepreneurs are doing is not unique. Others have come across the same situation, the same problems. The same solution exists within the collective file of documents and clauses. They need to recognise the signposts that are coming up, particularly those the entrepreneur fails to see.
The role is one of mentoring, guiding and advising.
They need to prove they are not the stereotypical blood-sucking vampire squids that we all think they are!
Meet the team
Indycube Ventures offers funding and expert advice to entrepreneurs. Entrepreneurs and small-business owners based at coworking space network Indycube are being offered access to a half-million-pound annual funding stream and expert advice.
"We have benefited greatly from David's experience, counsel and contacts on a wide range of issues. His past experience in the IP space is particularly useful to Inngot, but even without that, he is just the sort of investor and non-executive director a high growth business needs. He sees potential, makes connections, and keeps us focused on the things that matter."Martin Brassell, CEO, Inngot Ltd