Remember that lawyers are in business too and want to devote their efforts where they will be most rewarded and appreciated. While that certainly doesn't mean cheating a client, it does mean dealing with clients who see the lawyer as a trusted ally and not as an adversary and who will not be nibbling at the ankles with every step a lawyer takes.
In dealing with any lawyer, watch out for padded bills that have vague descriptions of what was done, beware getting billed for substantial amounts of lawyer learning time, scrutinize all cases where double billing might be involved, make sure billing rates match your needs as a company (big firm vs. small firm), try always to get estimates in advance, negotiate fixed fees or caps where appropriate, get timely bills sent to you, review the bills carefully, and question billing items that don't look right. As concerns lawyer billing, those are the big items. If you pay attention to those, you will maximize your chances of getting good value from the firm and minimize the risk of abuses. Beyond that, you normally can ignore the small or trivial points. Remember that it is a professional relationship and mutual trust should be the order of the day. If it is not, then maybe it should not be maintained as a continuing relationship.
We work with Yokum Taku and Jesse Chew at Wilson Sonsini, and they've been awesome.
Because I'm a former lawyer, I started out our relationship by scrutinizing every bill.
I stopped when I realized that we were getting an amazing deal. We have only paid 1 legal bill in 2 years and we haven't been bugged at all about it. Our legal bill is being subsidized by your Airbnbs and the like. That's the luxury of working with a great startup lawyer that works with top startups.
Another important point: You can always negotiate your bill. It is very common to pay less than the billed amount.
Full disclosure: I'm a former WSGR attorney. Now a WSGR client.
Sounds very "find a good lawyer".
How do you find someone you can trust? Or do you mean someone who appears trustworthy?
Also noting that the parent comment says that they stopped checking the bills. There are cases in business where people know this dynamic and once they aren't being checked they tend to take more chances. Hence even the person who relates "he is great and I trust him" may not be aware of what is currently happening with billing (if they are not checking).
But people tend to, in addition to doing the subjective "good work" , they refer people that they like personally or who encourage the type of relationship building that leads to more work. 
Also, in theory at least, if an attorney ends up being referred a great deal and has a nice book of business they would raise their rates and/or push work off on subordinates, right?
 And how, with legal work, do you know if it's "good" until the shit hits the fan or there is a problem?
 Even physicians are susceptible to this (but less so). I don't want to know who you like personally or who you know but who you think does a really good job as a clinician. And maybe you hate that person or their personality. That's fine. I just want someone who is good I don't care if you like having him over for dinner. (Had a girlfriend once whose father was a surgeon and they were always entertaining the family practice doctors so they could get referrals. He was a jerk to his family but he was sweet as sugar to the other physicians who he needed.
The attorneys he referred was from personal knowledge of what they had done for clients as well as their own interactions in the past (was a federal prosecutor).
I didn't know the person who wrote the blog (at the time) just cold emailed for some suggestions.
If my friends and cofounders tell me "John S is an excellent programmer!(or marketer, or designer)" I cna trust that. They know the industry, they know the skills, and can formulate informed opinions.
If those same people tell me "John S is an excellent attorney!", I can't trust it. They don't know anything about the legal profession other than the bill they get. They don't even necessarily know what to look for to indicate that John S is an untrustworthy git .
Any recommendations for cheaper alternatives that still offer similar quality?
If you're working with a firm that has summer associates (referred to as "law students" in the post), and they are being billed out at $200/hour, you are almost certainly working with a large, full-service law firm. And large, full-service law firms are expensive.
Working with a large, full-service law firm is overkill for the vast majority of early-stage startups. Even when it comes to securities-related work, you can find reasonably-priced experienced, competent practitioners with BigLaw backgrounds who work solo or at smaller firms.
(1) If you're unhappy with your bill, PUSH BACK ON IT. Even if you like the partner that you're working with, a substantial portion of your bill will be generated by paralegals and associates like me. And, as an associate, my marching orders are to account for every last minute of my day, even if I think it was an unreasonable thing to bill for. In theory, the partner is supposed to see these items before they go out and make a judgment call on whether to write it off, but more often than not, the partner will eyeball the total amount without looking too closely at the details.
Case in point: When I was a founder, a paralegal at a well-known law firm made a mistake with our cap table and left off a single share. We ended up getting billed $300 to find that single share. When we changed firms a year later, we mentioned this to the partner, who was surprised and had no idea this had happened (despite ostensibly signing off on the bill).
(2) Check in with your lawyer regularly -- doesn't have to be a phone call. A quick e-mail will do. Bills often come in monthly intervals, and fees can rack up pretty quickly in that time. As a lawyer, I'll often start work on a new matter only to find out that my work is no longer required after several weeks have passed and I've already billed the item. Regular check-ins can help avoid this. In addition, it'll be easier to draw connections between vague descriptions on your bill ("Attend to cap table") and what actually happened ("find missing share that paralegal left out"). As a side benefit, regular check-ins result in faster turn around, especially if there are multiple matters competing for your layer's attention.
(3) Second opinions can be free. If you're unsure about the advice your getting from a lawyer, ask a lawyer at another firm. Those other lawyers will view this as a chance to poach a client and will write their time off as business development. As a side benefit, those lawyers may point out mistakes that your current law firm didn't catch or is reluctant to admit to.
Ridiculous. As a business person that has dealt with lawyers, consultants, accountants (in the bricks and mortar world, not the startup lottery) as well as has clients that I do work for (so I've been on the other side) I would totally steer clear of anyone that comes out saying things like this. Unless I was desperate.
It's just not the way to have a professional relationship which involves trust.
Get approval on every expense? Even minor ones? Not going to reimburse for something unless on a white list? Get serious.
This strikes me as penny wise and pound (and time) foolish. The major cost is the hourly rate and whether you are being billed honestly for that (or not). And that is something you have no control over unless you are watching them all the time.
To expect that it matters that you will not approve a minor charge when the attorney can easily jack up his billing on the major charge is a waste of time.
Better to question the bills after the fact and if you feel that you shouldn't have to pay for the lunch bill that your attorney had when meeting with someone on your behalf while leaving a large tip by all means bring up the issue.
But just like with employees a certain amount of leeway is often necessary.
You are making a statement of fact based on your perspective. You could be right. My thoughts are based on many years in business, what I have experienced, and what I have observed. 
"The aim should be helping that company to get to a stage that they can have a big exit"
Except that it's a lottery and the attorney probably realizes that they have to make hay while the sun shines (or whatever that expression is). Most companies won't progress and won't have big exits, right?
Now if you want to argue that by doing this enough startups will be offended to the point that they won't refer business to them that might be a valid criticism. But in a world where people forget the price and remember other things (like results or even the way they are treated) I'm not sure that is the case (although it could be).
"Lawyers often seem to pass on charges that in any other industry would be considered a cost of doing business. "
What do you mean by any other industry? Are you saying that there aren't consultants that do the same thing? There are.
As far as those industries that don't do that it's because they are charging for a product or service that has certain bounds already set and baking in their costs into that. Law is charged generally by the hour. So it makes sense to break out those costs. Or they have certain methods that have billed over time that are not easy to change. My accountants don't charge when they write a letter because it's not what accountants do. But they charge me a fixed rate for services also.
And, in fact, I'd rather hire a painter and say "give me an hourly rate and I'll buy the paint and supplies for you" that way I don't have to worry that he is estimating to high and baking that into the price.
"The main cost should be the rate rather than the ancillary services and expenses."
If we can assume that if they have to eat things that they previously passed on, in order to make the same profit they will then have to either a) charge more per hour or b) bill for more hours, right? Unless you are arguing in general that "lawyers make to much money" which is an entirely separate argument.
 Now I once had a case where an attorney charged me for fedex overseas that the opposing side requested and made me pay for it. I said "why did you charge me" and he said "that's what attorneys do for each other". My thought was "why do I have to pay money so you can maintain a good appearance with that attorney"? But when you think about it if the attorney on the other sides sees that your attorney has a cheap client they will also know that that client won't want a long dragged out case which runs up legal bills. And they will use that to their advantage. I know this because I have done that to my advantage in situations (both legal and non legal). After all nobody wants to go against a deep pockets client. (This doesn't cover every possible pro and con but only illustrates that there are dynamics that you might not think of.)
As for #4 and #7, as a client you can probably get concessions given that it's a buyer's market for legal services right now. But generally, I think those practices are legit. The cost of training is baked into the price of every product you buy, and legal services is no different. With regards to #7 specifically, that tends to be a situation where the junior lawyer who doesn't say anything on the call will be the one doing whatever work comes out of the call. It will cost you more money in the long run if he or she isn't on the call and has to get a download after the fact.
A better approach is to communicate via e-mail when possible and communicate directly with the associate doing your work unless the partner needs to be involved. This is kind of related to #2 and #10. Where I used to work, mid-level and senior associates would handle the day-to-day communications with the client for securities offerings or credit agreements worth tens of millions of dollars. If you retain a large firm where an associate will be doing most of the work on your matters, then find a team where the partner in charge is good at delegating the day-to-day stuff so you don't have to incur his higher rates for that sort of thing. Alternatively, depending on your needs, you might find a small outfit or even a solo practitioner who will be doing most of the work on your matter himself or herself, and doesn't need to deal with the inherent overhead of delegation.
 Given that, it might just be easier to skip the nitpicking and ask for a 10% discount on the final bill.
PS: What do people here thing about fixed fee arrangements? I'm not sure how they should be structured for a startup, but that would avoid a lot of the silliness inherent in billing. At the end of the day, there is a price to legal services based on supply and demand. Whether you charge for law students or raise the top line fee or give an across-the-board discount is ultimately cosmetic.
That said, you should always ask for a ballpark estimate of how much any transaction will cost before going into it. This will give you leverage in negotiating the bill down if, for some reason, the bill ends up going over.
At $60/10min, they can take their lumps for training new staff, just like everyone else. If you call tech support, you're not charged extra when there's a trainee doing a ride-along. If you use retail, it doesn't cost more if a trainee cashier is serving you with a supervisor hovering over them. Having your car fixed doesn't cost more because an apprentice worked on it.
No other industry sees this sort of extra charge as reasonable, especially when there's so much fat built into the price to begin with.
I agree that charging extra for a ride-along simply doesn't seem fair. However, based on my experience, it's quite possible that the law student researched or wrote solo (billed at $200/hr), and then reported back to the lawyer with a finished product that only needed review (billed at $600/hr). Given the choice, I would much rather pay $200/hr than $600/hr.
I think that absent very explicit disclosure and agreement, they'd be grounds for discipline by the bar. Certainly they read like an easy MPRE question.
So what we have is that the base cost of a phone call with your lawyer is always going to be $60. I don't have a problem with that other than obviously it would be nice if the cost were zero.
As far as $60? A conversation of 2 minutes and a conversation for 10 minutes is still interuptive and takes your attention from whatever you are doing. As anyone who has been in a zone doing work will attest to.
If I would find this sort of pushback so irritating as an IT consultant, I presume a legal consultant would find it just as irritating. Why would you want to annoy an important consultant in this way?
Exactly. Experienced business people write this off to the "cost of doing business". You look at the total value and make a decision as to whether to continue the relationship. If you didn't know the way attorney's billed then you can be thankful for the lesson that you have learned. Read and understand before signing anything.
You are of course free to negotiate the fee down after receiving the bill and many lawyers will discount in order to continue the relationship. From my experience lawyers tend to be willing to accept whatever they can get that is reasonable - they aren't going to pursue an action against a client unless the majority of the bill isn't paid or there is something else causing animosity or problems.
On second thought, I think the more important issue is the one 7Figures2Commas raised: If you have a lawyer who does the worst of this stuff, you have the wrong lawyer.
With that said, my blood pressure would definitely climb if a client challenged a 6-minute incremental bill for a phone call that was only 2 minutes.
The other half should be spelled out in the engagement letter. If you don't like it, tell your lawyer -- we really will negotiate on these issues.
Which ones exactly and why? (Serious question if you are making a general statement please back it up with more information.)
Is there a different consensus around the definition of "billable time" in the legal world that makes this not as bad as it sounds?
For example: if a client is being billed for time spent traveling on behalf of the client, the lawyer could do nothing while traveling and the time would still be billable to that client (as travel time). Even if the lawyer then does work for another client at the same time, the lawyer is still spending time traveling for the first client. (Note that travel time is frequently billed at lower rates or is otherwise discounted compared to normal billable work.) Curiously, however, it is not permissible to bill the same client for travel time and again for time spent working on that same client's case while traveling.
The premise is that travel is wasted time by the lawyer - that he could have used for another client or family if he did not have to travel. If they can bill another client during travel, then it wasn't wasted time for them after all.
Two, some of these practices described would raise eyebrows with state ethics committees. Double billing travel time, rounding up your billable hours, it all amounts to padding your bills. Lawyers have been disbarred for such practices, and this typically happens when people start wondering how they can be billed greater than 24 hours per day by the same attorney.
Lastly, if you are a start up, you have no business going to an attorney that is going to charge you $600.00 per hour. A rate that high should be reserved for some specialties, like perhaps patent litigation. If you are paying an attorney $600.00 to incorporate for you, you probably will not be in business for long.
"You’ll have a conference call scheduled and they’ll invite additional attorneys to sit in. And they’ll charge you for it, even though they may not say a word during the meeting.
Add a clause to your contract that says, “We agree not to bill you for any more than one attorney on any conference call with you.“
As an additional tip, you may be able to save some money by doing some of the legal research yourself. Google works surprisingly well for some things, as does the local public library, which may have a subscription to Lexis Nexis or Westlaw. Facebook is a great resource for family law issues. There are also free law-specific resources like nolo.com (e.g. http://www.nolo.com/legal-encyclopedia/small-business) or avvo.com.
If you want to bill on some other basis, fine, but you are not entitled to tell your clients you're billing them an hourly rate and then make up the hours based on the value you think is being provided. That's fraud.
The law industry is a service business. You pay them for their services. The service you get is much less than what you pay for. This mismatch = an opportunity to do better and make a lot of money.
"If you use your lawyer, you’ll get charged way more than if you used a regular lawyer"