Getting Legal Advice that Aligns with Your Long-Term Success
We take a slightly different route on this week’s episode as we sit down and have a chat with lawyer Jonathan Ip (Founder, Iterative Law). In this interview, Jonathan discusses the importance for B2B companies, entrepreneurs, and startups to seek legal counsel and advice at the start of their endeavors, what mistakes to avoid, and how it’s also vital for businesses to adapt changing circumstances as the law continuously evolves.
Topics discussed in this episode:
Christian Klepp, Jonathan Ip
Christian Klepp 00:08
Hi, and welcome to the B2B Marketers on a Mission podcast. I’m your host, Christian Klepp, and one of the founders of EINBLICK Consulting. Our goal is to share inspirational stories, tips and insights from b2b marketers, digital entrepreneurs, and industry experts that will help you think differently, succeed and scale your business.
Alright, Hi, everyone, and welcome to this episode of the B2B Marketers on a Mission podcast. I’m your host, Christian Klepp. And today I have the pleasure of having someone on the show, who has been practicing law for many years, has worked at some of the most prominent law firms in Canada, and like our podcast, has made it his mission to help entrepreneurs, startups and b2b companies.
So Mr. Jonathan Ip, welcome to the show.
Jonathan Ip 00:53
Thanks, Christian. It’s great to be here.
Christian Klepp 00:56
All right, awesome. So let’s get this started. And you know, just give us a little bit of background, tell us about yourself?
Jonathan Ip 01:01
Yeah, absolutely. So I’ve been a practicing lawyer for well over a decade. I started my career at one of the top business law firms in the country at Davies Ward Phillips & Vineberg, where I really cut my teeth on the transactional work. So doing the capital markets, the fundraising side of things, as well as the M&A so the mergers, acquisitions, buying and selling a business side of things. And I was really involved with both public companies, private companies, really got to cut my teeth on the transactional side of things. I ended up working after that with a company called exploiting communications, which is a Internet Service Provider based in Canada that provides internet to rural Canadians. So it’s areas where the large Telcos won’t or can’t spend the capital to pull out fiber to provide the services. And that’s where I started to get a better understanding of just how the work as a lawyer really incorporates and it’s a supporting role with the business. So working directly with the business on the day to day, working with sales, HR, IT, Finance on just helping the business grow and understanding very quickly that you have to be very, very practical when it came to providing services and in helping the business before.
So I kind of took those experiences, you know, worked also at under one another large law firm, the largest energy firm in Canada called Bennett Jones, where I worked with the technology group, and help sort of work with the entrepreneurs, startup, scale-ups, the tech side of things, again, sort of continued to work with them from more of a holistic business perspective. So looking at the legal but also looking at what kind of practical business solutions can we provide to help them with their business. Yeah, and so my current situation right now is I run my own practice. It’s called Iterative Law, focusing more on helping startups and scale-ups with their business needs, and looking again, at things from a corporate legal perspective, security, commercial, just helping the companies with growing their business, and helping them do it in an efficient and ultimately compliant manner. But again, business first, you know, helping them drive their vision forward.
Christian Klepp 03:24
Yes. All right. Wow. I mean, that hasn’t been an extremely impressive list of credentials. And thanks so much for sharing that. And Jonathan, you brought up a really good point, and it’s something we’ve discussed, like in a previous call, and even just like, a couple of minutes ago. It’s, if you look at it from a point of view of an entrepreneur or startup, it kind of is applicable across the board. And what I mean by that is, people don’t really think about the law or consulting a lawyer until it’s absolutely necessary. And there’s probably many reasons for that. And it’s interesting, and I’m sure you have your take on that. So, why don’t you tell us a little bit more about that?
Jonathan Ip 04:16
Yeah, well, that’s the reason why I started my own practice, which is that I saw a gap in or need rather for earlier stage companies to access or have access to legal business strategic advice in a way that helps their business drive forward. Because I think the traditional worries are one of the many reasons why companies are early stage companies don’t get the legal advice they need early on, is because they’re worried about the price at the end of the day. You can kind of go you can go to the big law firms and have access to lots of expertise right, hundreds of people with various expertise, whether it’s in business, corporate securities, tax, what have you, but then the prices are commensurate to them, right. You’re going to a full service law firm, and you’re getting services on an hourly rate for the services that you’re looking for. And typically, you pay cash, and you gotta pay as soon as the deal is completed, first time client, then they’ll often require a retainer. And so you got to put up a bunch of money that sits in their trust account, and they deduct from their fees over time. And for earlier stage companies, I think that’s a bit of an issue when cash flow is the biggest problem and I think the reason why entrepreneurs don’t go seek legal advice early on is they think that, oh, it’s going to cost a ton of money. And I’ll just do it myself. And we’ll figure it out later, it’s a luxury that we can deal with later on.
And what I want to provide is, is that kind of service, the Hey, let’s talk about these potential legal and business issues and strategy issues before you get yourself into trouble early on. I want to provide that kind of advice in a way that ultimately aligns my success with theirs as well. So what I’ve been trying to do with my clients is to scope out a particular project, if they’re looking for project based services, or, hey, they don’t have a lot of cash, they want to spend more of it on the development side and build their product first. That’s okay, let’s talk about, there’s ways of deferring the fees or if you want to pay equity, my experiences also include blockchain and cryptos. So I’ve taken crypto payments in the past as well. So just finding ways to make things as flexible as possible so that people do get that advice early on. Because I’ve dealt with a lot of clients, where they didn’t get the advice, they didn’t go try to talk to somebody about this beforehand. And they went off and start their business with a co-founder, everything was great until it wasn’t, and then because they don’t have legal documentation on who owned what and how they were going to deal with situation when things went bad, or someone want to leave the business, they didn’t really have an easy way out, it just became large and difficult.
First, it wasn’t a negotiation, it was more, a lot of hurt feelings and anger first, which ultimately resulted in negotiation, once people realize that they need to do it, but then they have lawyers involved. So then the cost of dealing with that situation, after the fact was, I’d say that’s at least 5 to 10 times more than it would have costed them if they’ve just gotten some advice first, and gotten some documents to put in place.
Christian Klepp 07:37
Right, exactly. And I mean, that’s such a great approach to this very clearly vibrant ecosystem that you’re focusing on, Jonathan, and it clearly I think the order of the day is prevention before detection, and that’s even applicable when it comes to the law, right?
Absolutely. And I look at that the reason why people don’t want to talk to lawyers much is like, Oh, well, getting life insurance, like no one wants to think about getting insurance, because it makes me think about all the potentially terrible things that could possibly happen to you. Why insurance, it’s when something bad happens, and it’s there to protect you. Well, I don’t want to think about the possibility of dying, or I go bankrupt or something, or have done something wrong with my business. But I think there’s a way to look at it as, like to your point, it’s not, it’s not that, hey, these are all terrible things that could happen. It’s let’s just spend a couple minutes to think about how we can prevent things from going wrong in the future. And from a legal perspective, in my view, it’s looking at, Hey, take that excitement of building a new business and building a product, and just think through the entire lifecycle, because it’s not just hey we’re excited, and we’re started and everything’s great. It’s, well, what if life gets in the way? What if someone gets tired of running this business after two years, they want to focus more on family or they need to move somewhere else, and they can’t devote their time to this anymore? What if, God forbid, one of the co-founders gets hit by a bus the next day? What’s the business continuity? Have you thought about that? And in an ideal situation, similar to insurance, you think about it once, you put the documents in place, throw it in the drawer, never look at it again. But if you ever do come across a situation where something has gone wrong, then at least you have a plan in place, and you can enact it, or at least look to it.
Exactly. Well, Jonathan, those are really some great points that you’ve brought up and a lot of what you said is also applicable in my world. It’s like, you can say it’s like, same story, different characters in the world of branding, because by the same token, entrepreneurs or b2b startups, um, they probably, you know, early on in the piece, they don’t really want to invest a lot of money developing a solid brand strategy and what have you. And there’s many reasons for that. And while I totally understand that there’s also the other side of the equation, to your point, it’s, um, you know, they need to think about, okay, well, what if they, what if they take this to market, and they’re not really sure what their target audiences are, they don’t know how to differentiate their product in such a way that attracts the right target group. Right. So it’s all of these things that, and, you know, just as you rightfully alluded to, it’s also these things where, why don’t we have this discussion early on in the piece before you make the mistakes later on? And then, and then it might become a costly investment or undertaking, right?
Jonathan Ip 10:43
Yeah, absolutely. And to that point, it’s also the, some of the entrepreneurs and founders I’ve seen, they, they’ve taken the approach of “we’ll build it, and they will come” and I don’t think that works in this day and age. You do have to kind of look at things from a very holistic perspective. So engaging in something like branding and customer targeting, I think you need to know who it is that you are targeting your product to, and that will actually help engage on the product development. Like if you’re developing a vacuum, you don’t really know why you’re building what you’re building.
Christian Klepp 11:22
Correct. All right. That’s absolutely. Right. So, Jonathan, you spoke about a little bit earlier, but what is it that motivated you to enter the world of entrepreneurship after having worked at all these big law firms or for such a long time?
Jonathan Ip 11:37
Yeah, so my last position before I started my own firm was with a Chinese Merchant Bank. So they hired me to lead their legal team, but more importantly, to build out their advisory services, and focus on business development in North America. So these services was to help companies in the blockchain space. So you know, a very fast moving, still nascent industry, that’s probably best known for a Bitcoin and Ethereum. And the everything associated with crypto, but the technology itself is actually quite interesting, a lot of interesting applications. But we were helping companies try to look at things from a legal perspective, in a global way. So legal and business advisory. So blockchain technology is global in nature, because it’s based off of internet technology. But the laws that govern the use of it, and what you can do with it is jurisdictional. So it’s based on the countries. And so because it was moving so quickly, you have countries that were looking at it and trying to innovate and adapt their laws and regulations, within the other side of the world, they were just taking more of a slower approach. And so what we were doing was helping companies try to understand what exactly could you do, or try to do in, say, the US or Canada versus doing something else in say Singapore and Switzerland. And what I found was that, when meeting a lot of these companies and a lot of these entrepreneurs, because it’s an early industry, there are a lot of earlier stage companies that weren’t really a right fit for the company I was working with. But they needed legal advice. And they needed business advice, someone to talk strategy, and they need someone that understood that in a fast moving industry, you had to be nimble, you have to be flexible, you had to really kind of understand just how to help them grow their business. And that’s how I end up starting my own firm. Because I wanted to work with these earlier stage companies, I want to provide good solid legal services, but also bring in the experience that I have from working with companies at all stages, to help them grow their business and to help them succeed.
Christian Klepp 13:58
That’s a really great story. And to your point about like working with companies that are in blockchain or cryptocurrency, I mean, obviously that’s a sector that’s still continuously evolving. So, exciting times ahead as well. I’m gonna say that right?
Jonathan Ip 14:15
Yeah, no, absolutely. And every year in some things are even less like I think the saying in crypto and blockchain is that one year and blockchain in seven years in any other industry, so things just move so quickly and part of the excitement like I work a lot with blockchain companies I but I’ve also had the opportunity expand more into AI, more traditional fin tech, software based companies as well. So that was part of my decision when coming to start my own firm was to be able to work with other companies, but I really enjoy working with companies that are trying to push the edge and when it comes to knowing that the technologies but the solutions, that does mean that, the existing laws and regulations may not be ready to handle what they’re about to do. And so helping them try to understand what the potential limitations might be. But also the opportunities is one thing that I really like working with them on. And also helping them understand as laws get more defined, as certain cases come out and interpretations come up, what they should be aware of, and how they should adapt their business to either take advantage of those new rules, or to adapt their business to avoid getting into trouble down the road, because others have.
Christian Klepp 15:34
Yeah, no, that’s absolutely right. And you brought up some really good points about like adapting to changing circumstances. And we’ll definitely get to that in a second. But before that, you’ve been a practicing lawyer for many years now. And you’ve worked at some of the largest law firms in Canada before you decide to set up your own practice. And, as you’ve rightfully described a couple of minutes ago, you focus on delivering legal services to entrepreneurs and growth oriented companies in the b2b space, as well as tech startups. So, as you’re well aware, there are many mistakes that startups can make, if they don’t do their due diligence, and by due diligence, obviously that involve some seeking legal counsel, not just when they need it, but also in order to plan ahead, right.
So just in your professional opinion and from your experience, name the top 5 mistakes that you’ve seen startups making, and what others can do to avoid making these mistakes.
Jonathan Ip 16:40
Yeah, I think one of the top mistakes is not formalizing the business arrangements with founders, the founders or the co-founders early on. So often, it’s a couple of people who maybe are friends or business associates who’ve worked together for a while, and now they want to go up and start their own business. And they’re focusing only on the positive, which is, Hey, I’m working with my friends, get along well, and we’ll build this business in no time, we’ll be super successful. Let’s not worry about the legal or the financial area that, yes, we need some money to get started. But maybe we’ll use our own funds, our friends or family to help us but, we’ll figure out the rest of it later. And then they start building and they keep building and then something happens, it could be one of the co-founders decides, this isn’t for me, I want to do something else, or life changes, and they have no documentation to help them extricate themselves from whatever that situation might be, the particularly when it comes to co-founders, 50/50 ownership, let’s say their business, assuming they’ve even spoken about that. There’s just, there isn’t an easy way for them to untangle that, if they’re not in a position to do so in the sense of the relationship. Often when someone wants to leave, the other person gets really hurt. And then they, it just turns into a fight. And I’ve seen that time and time again. And that’s, that’s probably one of the biggest issues.
Kind of around that is, another mistake that they can have is not thinking through early on how to set up your business from a legal tax business perspective. So, for example, do you want to incorporate? Or are you just going to run this on your own as a sole proprietor, if you’re by yourself, if you’ve got co-founders, and you don’t incorporate, the default is you’re in a general partnership, and that can be a bit of a problem, because general partnerships are everyone has unlimited liability for everyone else’s actions. So my advice to most people is, you should, if you’re working with more than one person, spend a few hundred dollars, set up a corporation, issue ownership, figure out how you want to divide up the assets and deal situations, as they move forward through the corporate side of things. The other aspect is keeping good corporate records, keeping just good records, generally, it’s so easy to fall behind on the documentation. But when you need that, particularly for a lot of companies who are looking to get external financing, you’re going to venture capitalists, angel investors, they’re going to want to make sure that you’ve got all the paperwork done properly, and then, it gives them that confidence that you’re running a good business.
Christian Klepp 19:32
Well just everything in black and white, correct?
Jonathan Ip 19:33
Yeah, absolutely. Right. And it’s not to say that you can’t fix a lot of these things, if you’ve forgotten to do some paperwork or anything like that, but it’s about perception. You get potential investors super excited about the business. Then they say, Okay, great, can I just do some due diligence, I’m gonna do some digging and just make sure that your business is running properly, that I believe in your projections and I understand what the ownership of the company. Is the documents and they I’d say in an organized and coherent manner. It just puts some doubt around that… Well, if they can’t keep their own internal documents up to date, how do I know that they actually know what they’re doing when they’re running the business. So it’s about trying to make things as smooth as possible and keeping good records is good, it is important that way.
The other sort of top mistakes I see is more on the HR side. So are you hiring somebody as an employee versus bringing them on part time as an independent consultant? Some of the concerns around you know, just the classification? Do you have the proper agreements to indicate what they are supposed to be with respect to the business? Do you have, you know, and then in those documents, do you have proper, say, termination provisions, if things don’t work out, or someone wants to leave? Have you included provisions around confidentiality, non-competition, non-solicitation, non-disparagement. So those are important, because the last thing you want is someone working with you deciding, hey, I’m not going to work with anymore, but hey, the idea that you have for this business, that’s great, I’m going to go do it myself. That’s the last we want, and I’m going to steal your employees too. I’m going to go and get them to join me because I’ll offer them more money or, I’ve got some twists to this idea that I think is a lot better than yours. And so just protecting yourself.
And then, IP issues, intellectual property. So just making sure that, if particularly on the tech side, if you’re a software based company, or a technology based company, that your business owns the intellectual property. So if you’re bringing in independent consultants to work, make sure that they’ve assigned all of all the intellectual property they’ve created to the business, because that’s an important thing, particularly for again, investors, people looking to buy your business down the road. But there’s, there’s also, for software, just be aware, and a lot of businesses use open source software, as part of building their business, and that’s great. But just take a look at the licensing requirements, some of the licenses will say, hey, you can use the open source, open source software. But in exchange, you’re, you have to, everything becomes open source as well, including what you’ve built. Others might require that the source code be available to all the users. So just, again, be careful about that. Because if that’s not what you want, and if that’s not what, say someone looking to invest in your business, or someone that might be looking to acquire your business once and it becomes a bit of an issue down the road.
Christian Klepp 22:40
Hey, it’s Christian Klepp here, we’ll get back to the episode in a second. But first, is your brand struggling to cut through the noise? Are you trying to find more effective ways to reach your target audience and boost sales? Are you trying to pivot your business? If so, book a call with EINBLICK Consulting, our experienced consultants will work with you to help your b2b business to succeed and scale. Go to www.einblick.co for more information.
Okay, fantastic, Jonathan. And thanks so much for sharing those observations with us. And of course the advice and I believe you really hit several nails on the head there. Certainly a lot of things that you’ve mentioned, that founders or entrepreneurs and their partners may or may not have thought about when they set out to start their own business, or intellectual property certainly is one of them. And the other one is about the formalization of the arrangement between the partners and division of shares. And the non-competitive and non-disparagement clauses and these are all definitely things that any company should take into consideration before they start in their venture, right?
Jonathan Ip 23:55
Yeah, no, absolutely. I do think so. And it’s often it’s just a conversation, it’s just worth kind of highlighting and say, Hey, well, what do we want to do in these situations? And by and large, I think most people will have broad agreement on what the approach should be if it ever happened. But if you don’t have that conversation up front, then you just don’t know what will happen if and when one of those situations?
Christian Klepp 24:20
That’s right. That’s right. And I think to a certain degree, you’ve rightfully alluded to it in the past couple of minutes. I mean, these are conversations that, like, Look, whether it’s difficult or not, I think these are conversations that are absolutely necessary to have, right. And especially like early on in the piece, you know, before the company / you start scaling it up and the revenue starts to come in and what have you.
Jonathan Ip 24:44
Yeah, and maybe one of the reasons why people don’t want to talk about is that they have this impression that, Oh, well, if I talk to a lawyer, they all charge by the hour. So that initial conversation costs money. I’ll tell you that most firms, most lawyers will be happy to do an initial consultation just to at least get a lay of the land, understand what it is that a potential client is looking for before formalizing some sort of engagement with them. And I certainly talked to a lot of people that are perhaps a little bit too early stage for me to get involved, or they’re actually looking for someone else with different expertise that I’m happy to recommend they talk to a different person for, but just having, starting that conversation, and just getting a sense of, well, what should I think about doesn’t mean, hey, I’m paying for it, right? You know, where we can help you at least get to start to think about what is you should worry about now, the immediate, and maybe the medium term, before you actually engage formally for the actual legal services.
Christian Klepp 25:48
Those are definitely incredible insights. And Jonathan, some of the clients that you work with, I believe, especially in the field of tech startups, they find themselves in areas that are, you know, and you’ve mentioned that I believe it was with blockchain and cryptocurrency, they are in areas that are constantly evolving. And as such, the challenges and the circumstances they might find themselves in, will continue to change as well. Right? So how would engaging a lawyer help these companies to adapt to the ongoing dynamics and when I say ongoing dynamics, it’s okay, as, for example, blockchain continues to evolve, or like now, with the current pandemic, and the ongoing economic crisis. So what kind of advice would you give them in order to adapt to these dynamics in the right way?
Jonathan Ip 26:42
You know, working with a good lawyer can help companies get the insights that they may not otherwise have on their own, because, I mean, they, they’re focusing on building their own business, their own products, going out to their own customer, and so they don’t necessarily have the time or the resources to sort of consider other factors that might be happening.
So as an example, the pandemic has forced a lot of people to not work in the office anymore, make some difficult decisions when it comes to employees and consultants, and just, from an HR perspective, what to do, from the short term to the medium term. And also, in Canada, we’ve had a lot of good subsidies or subsidy programs that were enacted, but very difficult to understand or to find the time to figure out how to apply for them, and how do you actually qualify? And when what do you do there? So, during the early stages in, say, sort of March, April, May, a lot of people I was talking to it wasn’t ‘Hey, how can I help you from a tech or business perspective?’ It was, ‘Hey, have you looked at the recent, say CEWS subsidies?’ right? Maybe that will help you with your payroll issues, and maybe that will help you keep your employees a little bit longer until you get over this? Because I was talking to more than one business where they were making those difficult decisions – Do we fire people and just give them their notice and pay them? And, let them hopefully give me the opportunity to find that position? Or do we try to lay them off and wait until things turn around? And so what do we do here? And so just giving them that insight, the information that they may not have the time to think about or look into. It, definitely, I think help them at least decide what they want to do in a more informed way.
When it comes to industries like blockchain, like you said, things move very quickly. So, someone like me, ’cause I try to keep abreast as to what’s going on from a regulatory side of things, and recent developments. And so trying to bring some of those insights into, hey, this is what the securities commissions in, say, Canada are doing now, when it comes to crypto exchanges, or this is what the SEC has just recently said about a token issuance that happened two or three years ago. And how they came down on that. It helps the companies get that insight into, well, if we want to do something similar, should we do it the way they did it? Probably not. But is there a way for us to do it in in a way that is hopefully more compliant or is completely compliant, so we don’t get in trouble with the regulator. So just be able to kind of bring those insights, I think, can be very helpful for businesses that are trying to navigate uncertain situations.
Christian Klepp 29:31
Yeah, no, I mean, that’s definitely fantastic advice. And I’d like to expand on that a little bit. I mean, you’ve talked about in the past couple of minutes, but, um, I’d like to get your take on, like some of the things that the trends or the changes that you’ve seen, at least from our legal perspective, as a result of what’s going on around the world now, because clearly we’re going through a crisis that’s of an unprecedented magnitude, and I’d just like to get your take what do you think’s changed, at least the legal landscape in Canada? And know, what kind of advice have you been given clients as they struggle with all this uncertainty?
Jonathan Ip 30:09
Yeah, so, you know, from as a result of the pandemic, like, like I said, a lot of people are staying at home. And so, I think there’s a lot of interesting businesses that have either pivoted or, or tried to build new products that take advantage of the changing landscape.
Christian Klepp 30:30
I’m totally with you on that one. And thanks for thanks for sharing that. And it’s definitely true that, now that everybody’s working from home and working remotely, I mean, chances are that moving forward, for the most part, at least, that there’s many people that are probably not going to return to the office, or it’s going to be a bit of a hybrid model, right, like they’re going to go in for a couple of days a week, and then they’re going to spend the rest of it at home. And the other one, as you’ve rightfully alluded to, is probably people that are, you’re going to work with a team that is based across different geographies, or even time zones, right, and it won’t really matter as much as it used to be anymore.
Jonathan Ip 30:30
So as an example, a few months ago, there was when, when people are still trying to figure out how to do contact tracing. A business I was aware of, actually pivoted their business, which was originally technology for payment in large group events, to using their product for tracing of employees, people come into the office just to get their information and collect it. So that, you know, tracing, you would have the information available. So that was an interesting change. Some of the businesses we’ve seen that have grown exponentially. Well, for example, Zoom is a really, really big one, right? You’ve seen a lot of people now using that, taking advantage of the online technologies to interact globally. I think one of the interesting things about this is that businesses are getting more used to having a global workforce, a remote workforce. And so a lot of businesses are probably, you know, when they originally thought this was gonna be a short term thing before everyone goes back to the office, are now thinking, well, this is going to be a long term perspective. So a) doing it the office space is the first question. And certain businesses have definitely come out publicly to say, well, maybe we don’t need that space anymore. And so that’s one thing, but then how do we maximize productivity for people working at home? And on top of that, well, do we need to be locally bound anymore? Because we needed originally to have a look for people only in say, Toronto, because our offices in Toronto. Well, if everyone’s working remotely, why should I get the best talent globally, or, at least, you know, say, in North America, so they’re in the same time zone? So I think those are some some of the interesting trends we’re going to see.
Yeah I think by and large, that’s probably true. I mean, I do remember reading a few articles about how having meetings with multiple people on Zoom is actually more fatiguing than doing meetings in person, because you have to, there’s like the, I think a lot, it’s more the focus issue, which is got all these faces that you have to focus on all at once on your screen, as opposed to when you’re meeting someone in person, you can focus on the person talking in a given time. And personally, I think that there is a collaborative dynamic that can only really happen in person, some of the spontaneous meetings, you run in some of the office on the hallway and say, Hey, I was just thinking about this thing, can we just have a quick couple minutes to talk about it, and then that turns into a completely new, say product or new development for the business, I don’t think we’re going to have that if all we do is have a purely remote, you know, remote situation, but I think we’re gonna end up with some kind of hybrid of the two, right? A lot of work can be done at home by yourself, or just by talking to people on the phone or through Zoom or other meetings like that. But those collaborative moments, those ‘aha’ moments that that group can kind of come up with, I think we’re still there’s still a place for that. And particularly in, like, say, the tech industry,
Christian Klepp 34:19
Yeah, no, I absolutely. I mean, it certainly will come with its own set of challenges, undoubtedly, but yes, I’m with you on that one that nothing necessarily is gonna replace on the dynamics or the energy that you’ll get when you’re having a face to face versus having a Zoom meeting where all you see is like different screens. I mean of course it’s going to be a completely different experience.
Jonathan Ip 34:46
Christian Klepp 34:49
So, Jon, we come to one of my favorite parts of these conversations that I have with people I invite on. It’s talking about commonly held beliefs. Alright. And like every other field of expertise, I’m pretty sure that the field of law and legal practice has its own set of conventional wisdoms and conventional, commonly held beliefs rather. So talk to us about one such belief. But tell us why you strongly disagree with it and why.
Jonathan Ip 35:22
I think one of the commonly held beliefs that permeate not only the legal profession, but also for a lot of clients is the perception that the whole point of a lawyer is to really just point out and assess, and all the potential risks that could happen to a business if they took a certain direction. So you’re just going to look at a situation say, Well, here are all the terrible things that could possibly happen to you. And that’s the job. But I think a lot of younger lawyers look at it from that perspective, because law school does train you to, in many ways, be a bit on the conservative side, when it comes to assessing risk, right, your goal is to protect your client is the focus. But protecting your client doesn’t mean just tell them all the terrible things that could happen. And as you get more, I think, more experienced, the more experienced lawyers take that and say, Okay, so we figured out all the potential issues that could happen in the situation. Now we’ve got pare it down to what would realistically could potentially happen. And, what are the real risks, and also, what are the minute risks that if it did happen would have a major impact on the business. So taking the experience and kind of assessing with that lens, but on top of that, you then have to, if you want to be a good lawyer, come up with the solutions, right? Propose how you get from point A to point B for the client and the business. And I think you get a lot of good lawyers that’ll do that. But the client wants even more than that. If you want to be a great lawyer, if you want to be that great advisor, that they’ll come back to over and over again, is helping them make the decision. So the clients ultimately decide which way they want to go with the business. But if all you do is prevent, provide them with, hey, here’s the three solutions, I could get you there, but I can’t tell you which one to take, that’s not entirely helpful. It’s I think, saying, going a little bit beyond that, and saying, hey, here are the three solutions. If I was in your shoes, based on my understanding your business, I’d probably choose A and here’s why. But you know, B is not bad either, because of x, y and z. C’s okay too. It’s still your decision, but I’m going to help you figure out which path you want to take. And I think a lot of lawyers aren’t willing to do that. Because they think that it puts them at risk that the client blames them for, hey, I chose path a because you told me to do and that’s not the situation, the situation is you help the client decide what they want to do, and they will tell you what they want to do.
Christian Klepp 37:59
Right. So if I’ve understood you correctly, in the past couple of minutes, you also see yourself or rather your role as a trusted advisor. Right? So it’s not just like you’re giving them a laundry list of solutions. But you’re actually like advising them of which course of action, you believe that they should take and what the reason for that action is.
Jonathan Ip 38:20
Right. And it’s again, it’s just advice, they don’t have to. I’ve had plenty of clients where I, you know, I that I know really well is who I go to, and I say look here, here are the two solutions, I think you probably want to do this one. But then they come and say, Well, actually, No, I’d rather take option B. And here’s why, here’s a few additional facts that maybe I didn’t tell you, or here’s my concern from a bigger picture down the road. And it but what it does do by doing that is it facilitates that dialogue. And ultimately, at least the clients that I work with them on a long term basis, that’s what they’re looking for. They’re not just looking for someone to give them facts, or solutions without context. It’s about bringing in that context being a part of their team ultimately, and like you said, be there trusted advisor, and help them try to figure out what might be the best move, not only today, but also for the medium and long term.
Christian Klepp 39:15
Exactly. So, Jonathan, if you put yourself in the shoes of a tech startup or a company of that nature, right, and some of the things that you’ve seen as you’ve been practicing law. I know there’s many things, but let’s just let’s just narrow it down to one thing, so what’s the one thing that you believe people should start? And what is the one thing that people should stop doing, when it comes to engaging a lawyer?
Jonathan Ip 39:46
I’d say the one thing that they should start doing is start talking to them as soon as possible. So when you’re at a position where you think you are forming that business, so it’s more than just an idea that you’re throwing around your friends, but it’s getting serious and you’re thinking about putting some real resources into it. You know, as I said before, like don’t leave until later. You know, the results of not having come up with the right approach to start the business can have some pretty bad consequences down the road. And like I said, most lawyers are willing to have that initial conversation not charging for it. So go talk to the people who are willing to, you know, just kind of put you on the right path and do that.
What I think people should stop doing is, is focusing on just the price. Yes, you can get lawyers that are very expensive, you can get lawyers that are on the cheaper side, I mean, historically, lawyers charge an hourly rate, and the hourly rate increases as you get more experience. So if you look at from that perspective, yes, you could get someone that was cheaper, but chances are, they might be less experienced, and perhaps you need that experience. And I would say, for people who are starting businesses, you do want someone with some experience, or perhaps a lot of experience to be able to give you some of the additional. A more junior lawyer just may not be able to do so. And, as an example, there are a lot of startup packages that the big firms are throwing around. And I think there’s a place for them. And, you know, for a good, you know, a fixed fee, they’ll set you up, set up your corporation, maybe do a shareholders agreement with you and your co-founder, and kind of send you on your way, which is great. But just be aware that a lot of that work, because they’re trying to give it at such a low rate is probably being done by someone who’s a bit more junior, who can do the documents, but may not have the insight to ask you some of the questions that should be asked before you actually go down the path of starting that business with your co-founder. So just keep that in mind. I’m not saying that you shouldn’t be working with big firms. Or, you should only work with sole practitioners. I think that there’s a time and place for big firms, medium firms, sole practitioners. There’s a space for everybody. And there’s a there’s a time and place to use.
Christian Klepp 42:18
Exactly. So there you have it, ladies and gentlemen, for all of you out there that are thinking of starting your business or already have a business going and some of the things you should start or stop doing before you engage a lawyer. And if you’re in doubt, or when in doubt, brother, um, please feel free to hit up, Jonathan Ip. Speaking of which, how do people out there get in touch with you?
Jonathan Ip 42:40
Well, you can find my website is iterativelaw.com. And I’m also available on LinkedIn. So please feel free to reach out to me if you have any questions.
Christian Klepp 42:50
Amazing, Jonathan, this session has been really informative. And I have no doubt that the listeners I mean, I, for one have walked away from today’s discussion, having learned something new. So thanks so much, again for your time. And we really appreciate it.
Jonathan Ip 43:07
Now, thanks for having me Christian. And look forward to doing this again soon.
Christian Klepp 43:10
All right. Well, thanks. Thanks so much, Jonathan. So you take care, be safe and talk soon. Bye for now.
Jonathan Ip 43:18
Yeah, you too. Take care. Bye for now.
Christian Klepp 43:22
Thank you for joining us on this episode of the B2B Marketers on a Mission podcast. To learn more about what we do here at EINBLICK, please visit our website at www.einblick.co and be sure to subscribe to the show on iTunes or your favorite podcast player.
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