The best time to hire a lawyer, is before you need one!
We are often asked, “When do I need a business lawyer?” The easy answer is, before you need one. But you already knew that, right? So the next best answer is a lawyer’s favorite answer, “it depends.” In this article we will offer a few key points during the life of a business venture when we are most frequently retained by our clients. Of course, if it were up to us, every business would retain a lawyer from day 1 and remain in contact so as to avoid ever “needing one.” We are so passionate about this last part, that we created client friendly Subscription Plans that will fit most small business budgets.
At the Start-Up
There are many things a small business owner can do on their own, even in the legal context. However, just because they can do it, does not always mean they should. If you are on a very tight budget, one of the “form a business” websites will offer basic legal documents at a cheap price. While we do not recommend this for numerous reasons, it is an option.
Alternatively, you should be able to find a small business attorney that offers value priced, or fixed priced, business start-up plans. At a minimum, you will want to sit down with an attorney to discuss your business plan, your goals, and learn about how to protect your personal assets from your business liabilities. A typical start-up client has engaged in a lot of research, so they have a good understanding of what they need. A well-rounded business lawyer will confirm some of their research and add many valuable insights.
Typically, our business start-up clients come to us because they want additional guidance and peace of mind. We help them by guiding them through the business formation, selection of an entity type, future legal issues, and provide general business insights related to the legal aspects of business ownership.
About 1/2 of our business clients come to us when they first get started.
2 to 5 Years in the Biz
This is a turning point for many small businesses. Something magical happens somewhere between the Second and Fifth year in business. Business owners start seeing profits, hiring employees (or more), and noticing a never ending stream of liabilities. Which explains why nearly the entire other 1/2 of our business clients come to us during this time frame.
Now that the business has been moving, owners start to see that some of their boiler plate documents are not working. They also know that they have an investment that is returning profits and they want to protect that investment. Perhaps they have come across a few legal issues and want to make sure they are handling them properly.
When we first sit down with a business at this stage, we like to learn about the business and gauge what legal work has been done in the past and what we need to accomplish for the future. Once we have a decent picture of the business, we can start prioritizing legal work and help get the business on the right track.
5+ Years in the Biz
There is never a bad time to hire a business lawyer for your small business. A small percentage of our business clients come to us after they have been operating for over 5 years. These types of business clients tend to come in two main categories. First, businesses that have never (or almost never) used a business lawyer. Second, businesses that have never formed a relationship with their legal team.
The first type will typically come to our office in a very similar state as those in the 2-5 year category. Sometimes it is because they are just now, after many years of hard work, becoming aware that they need legal help. Others, for probably good reason, have avoided using a business attorney due to past bad experiences.
The second category, those businesses that have used attorneys in the past but are making a shift, are a lot of fun. Most of the legal basics are complete, so a quick inventory and assessment can get us up to speed quickly. The reason they shift, typically, is because they are ready to build an advisory team and want to continue building on their foundation.
We often point business clients or business owners searching for an attorney, to an article on Selecting a Lawyer for your Business to hopefully help them avoid this lawyer switch down the road. Although, admittedly, we are excited when we get the chance to show them the Welch Law difference.
When You are Ready
When do I need a business lawyer for my small business? When you are ready. There is no magical formula. While we may prefer to join your team at the onset, we also understand some business owners just are not ready yet.
When you think you are ready, check out our business law pages and learn about how we can help. If you know you are ready, give us a call at (636) 352-1222 to see if Welch Law is a good fit to join your team. You can also contact us here.