Every Startup Needs an Attorney. Here’s Why.

Katie Fleming

Katie Fleming

Co-founder and COO of Owner Actions

A legal balance for startup attorneys

An attorney can be an invaluable member of your team, especially as you work through the startup stage of your business.

But for many, it can be tough to figure out which kind of legal practice you need, and further, which attorney in that realm has the right skills and experience to support you through the process.

In this guide, you’ll learn how to find a great attorney. Plus, you can find out about the kinds of tasks you should allocate to them—and the ones you can take on yourself.


Who do I need?

Most owners will need a small business or startup attorney who can file incorporation documents and trademark applications, draft employment agreements, review essential contracts (including lease agreements), set up terms sheets for investors, and provide guidance through early tax concerns.


How do I select the right one?

Your attorney will play an important role in helping you form your business and position it for growth.

Their role matters, so you need to be diligent in choosing one who’s a good fit for your business. Start by finding multiple attorneys who have experience with startups. Then, arrange a free in-person consultation.

Need help finding a startup attorney? Consider working with Contract Counsel. Check out their website here.


When you meet, ask about their experiences, strengths, and styles of communication. You can use this set of questions to gauge their knowledge and expertise with small business issues:

  • What is your experience with small business startups?
  • Do you have experience filing incorporation documents and trademark applications?
  • Do you have experience drafting employment and independent contractor agreements?
  • Are you able to provide basic small business tax guidance?


Then, ask about their practice, availability, and style of communication. Here are some questions that can help:

  • Who are the members of your legal team, and who will be handling my requests?
  • Could you refer me to another lawyer if an issue fell out of your realm of expertise?
  • What are your typical turnaround times for creating the documents I’ll need to file to start my small business?
  • What is your fee structure?
  • Will you have any conflicts of interest in taking on my business?
  • Can you communicate with me through my preferred medium (in-person meetings, phone calls, or emails)?


Pair what you learn with online reviews, verification of licensure, a review of the attorneys’ websites, and web searches to ensure you have enough information about your startup attorney candidates to make an informed choice.


What about payment?

Payment is a huge consideration, especially for owners looking to keep their upfront costs to a minimum. Be sure to ask your attorney candidates about their preferred payment arrangement and whether they offer any of the payment structures that could help you minimize or defer your legal costs. Here are a few that could be possible:


Flat fee

Your attorney may offer a flat rate for drafting standard legal documents. This setup can help you budget the initial costs of starting your business.


Discounts for multiple services

Your attorney may offer you a reduced rate for committing to using the firm for all documents and negotiations that’ll be required to begin operations.


Contingent fee

Your attorney may be open to receiving payment upon the approval of your incorporation documents or trademark requests rather than paying as services are provided.


Equity in the business

Your attorney may agree to accept equity in your business in exchange for the upfront and ongoing legal services he or she provides.


The attorney you choose may require an upfront payment or retainer. The retainer can be refunded if the value of the service is less than the retainer value. You may be billed for additional costs that exceed the value of the retainer.


Are there other ways to save?

Another way to reduce your legal costs is to do some of the work yourself. You can complete tasks such as obtaining a business license, filing business formation papers, or applying for an employer ID without a startup attorney’s help. However, other tasks, including drafting founder agreements, reviewing contracts, or setting up term sheets for investors, should be relegated to a legal professional.

You could also reduce some of your legal costs by using a legal form site. LawDepot is one option that offers standard legal forms and services for a low monthly or per-item rate. However, many owners prefer to work with a lawyer or legal team to make sure their legal documents are filed completely, accurately, and without any oversights.


Am I ready to get started with a startup attorney?

Finding a great attorney is an important step. Next, you’ll need to find a highly qualified accountant to help you create the financial statements and forecasts you need to attain financing. Check out this article for must-read advice for choosing a professional:


Ready to connect with an accountant? Here are a few of our favorite firms:


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Be Tax Ready All Year Long

With Xendoo, you can access a dedicated team of expert CPAs and accountants who provide monthly bookkeeping, tax preparation and filing, and tax consulting, three services that will help you stay on top of all your financial needs. Their team can also help you with your personal tax returns, too. You can explore their plans with totally transparent pricing by following the link below, and for a limited time, you can try their online bookkeeping service free for one month. Restrictions may apply. See Xendoo’s site for details.

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Business owners love 1-800Accountant. Here’s why. First, the service pairs you with a CPA who is an expert in your state and industry and can answer the tough questions you have about your business. Second, while many others charge by the hour, or worse, by minute, 1-800Accountant sets you up with an affordable, flat-rate pricing plan so you always know what you’ll be paying. Follow this link to try 1-800Accountant for 30 days with a money-back guarantee.


Starting a business is a complicated process, but we have articles and advice that can help you with every action you need to take. Log into your owner’s portal for free, personalized guidance that will help you make your venture a success.

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