Each year, between 36 and 53 percent of small businesses are sued. It’s a frightening statistic that you cannot afford to ignore as an entrepreneur.
Being involved in litigation can have serious financial implications. In 2018 alone, the American tort system’s commercial liability costs amounted to a staggering $343 billion, with small businesses shouldering well over half of those costs.
But a lawsuit does more than just cost you money. It can severely damage your reputation and destroy the trust customers have in you. The best way to prepare yourself against these risks is to have a business attorney you can count on at all times.
That’s because even with the best-laid plans, legal problems can arise at any time. When that happens, your business lawyer can help fight for your rights and boost your chances of coming out on top.
But how do you find the right business attorney for you? Here’s a comprehensive guide.
Table of Contents
Determine Your Specific Needs
Generally, you shouldn’t wait until you need a business lawyer to start looking for one. If possible, retain one as early as possible.
That said, there are certain situations that may require you to contact a local law firm right away. These include:
When Choosing a Business Entity
Any aspiring entrepreneur will usually do as much research as possible on matters of business. You can check out this blog for some useful business nuggets.
But even with the most extensive research, you may still find you need the insights of a professional when it comes to choosing the ideal business entity for you. The truth is the kind of business entity you open will greatly impact your growth in the future.
A seasoned business attorney will walk you through the strengths and drawbacks of different entities and recommend the one that suits you best. For instance, if your plan is to raise venture capital, a C-corp is your best choice.
Raising Capital
A business lawyer can also prove helpful when the time for raising venture capital and selling equity to your investors comes. They can draft the necessary term sheets and help you navigate the complex securities laws.
Other areas where a seasoned business lawyer may come in handy include:
- Drafting founder agreements
- Contract review
- Tackling employment issues
- Getting intellectual property (IP) protection
As you can see, a business attorney can be one of the most important partners you have when laying down the very foundation of your business.
Source Attorneys Through Your Personal and Professional Networks
Personal and professional networks can prove extremely useful when sourcing for a business attorney. A trusted friend, colleague, or family member can recommend a business lawyer they’ve worked with in the past.
Another helpful source is a business owner whose business is in the same industry as yours, especially if they’ve faced the same legal concerns as you now are. Business professionals that you currently work with, such as your accountant, may also be able to recommend some reputable business attorneys in your area.
You may also consider checking reputable sites that offer attorney reviews. Generally, an attorney with stellar reviews will give you satisfactory experience.
That said, you’ll still need to conduct your own due diligence besides the reviews to verify that the lawyer is indeed the right person for you. For instance, you may want to verify whether the attorney is licensed to work in your state.
Interview Your Prospective Business Attorney
Now that you have a list of attorneys you’re interested in working with, it’s time for the next critical step: interviews. Most lawyers offer free consultations with potential clients. During this consultation, you can decide the best law firm for your business.
If possible, arrange for an in-person meeting. If an attorney agrees to such a consultation, it’s the first sign they value the importance of nurturing client relationships and has no problem making time for you. Besides, a one-on-one meeting gives you the chance to get a clearer sense of your potential attorney’s personality.
Take the time to prepare a list of questions that you’ll ask during the interview. This way, you can make the most out of the half-hour or one-hour consultation time the attorney gives you.
Some useful suggestions include:
- What experience do you have working with similar businesses
- Are you experienced with my particular issue
- Will you be the one handling my business issues
- Are there any conflicts of interest I need to know of
- How shall we communicate
- Can you refer me to specific businesses you’ve worked with in the past
Of course, there are lots of other questions that can help you discern whether you’re getting the right expert in business law for you. The idea is to prepare yourself as much as possible for the interview.
Agree on a Fee Arrangement
The final step in your search for the right business attorney is to agree on a fee arrangement that makes the most sense for you. If you’re still a small business, attorney fees will naturally be among your top concerns. That’s because your budget is bound to be limited.
Most attorneys charge an hourly rate. However, you and your attorney can still agree on other fee arrangements, such as a flat fee, a contingency fee, or even a retainer agreement.
Once you’ve reached an agreement, put it in writing to avoid future misunderstandings.
Finding the Right Business Attorney Doesn’t Have to Be Hard
A business attorney can prove a great asset, regardless of the size or nature of your enterprise. However, not every business attorney is the perfect fit for your business. It’s the reason you need to do due diligence before making your final decision regarding who to hire.
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About Carson Derrow
