

Be well prepared to limit/reduce legal fees - pedalpete
http://ricksegal.typepad.com/pmv/2009/07/eyodf-part-two-the-l-word.html

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grellas
An idealized case is described here: knowledgeable entrepreneur works with
cooperative investor to pre-negotiate all the business terms, with the
attorneys brought in essentially to do routine documentation based on the pre-
agreed terms.

The points are good ones given the assumptions made.

Practical barriers, however, will often tend to divert you from the idealized
case: (1) inexperienced entrepreneurs who will not be able to pre-negotiate
any terms without a lot of lawyer help; (2) investors who engage in
gamesmanship that precludes an easy negotiation; (3) green associates working
for large firms in VC deals who push legal technicalities to the extreme,
requiring a lot of back and forth to attempt to document even simple points;
(4) complex situations that require lawyer input right from the start to help
solve the problems.

Bottom line: aim for the idealized case but realize that attaining it is
probably more the exception than the rule.

Quite apart from funding issues, though, the general principle here is
important: it pays to do educate yourself, do your due diligence, and to
manage your lawyer time carefully.

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pedalpete
Very good points grellas. Particularly on the 'inexperiened entrepreneurs not
able to pre-negotiate terms'. I think this may often come down to the
essential 'not knowing what you don't know'. I responded to Ricks blog that i
use a boilerplate document and go through line by line to figure out what the
important talking points are. Then you can at least get those pinned down
before the lawyers come in.

