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Author - Associate Sanjani Shah

A startup faces a lot of legal hazards before becoming successful. Having a lawyer on board is an advantage. A lawyer can save your company from running into a conflict of complex law of states and central security laws. Disobeying of these laws can lead to heavy civil accountability or imprisonment. Even legal advisers who are not experienced in security law should know enough to understand and notice delicate grounds. For reviewing marketing materials and private placements memos can be done better by a lawyer as compared to the director of a company than outside counsel to mark possible misleading statements. This is an absolute essential in avoiding legal issues.    

With the right lawyer on board, your company can avoid potential hazardous risks, dentify and assist you to take advantage of prospective opportunities. Any lawyer who has been in private practice for quite some time are themselves business personnel. They can plan and direct many of your company‘s issues like operations management, customer accession and relationship building, and branding and public relations. Due to their instinct and insights, they have gained this aspect of their legal practice and it will coordinate well with your company goals and action plans. For instance, a lawyer generally has an ability to read between the lines and respond to a delicate issue that can make them an important addition key at outward-engaging meetings.

As generally lawyers are often dedicated newspaper readers who keep a track on local stories, litigation activity, and community perception of their customers.  In short, lawyers have an idea that which business is doing well, which one is facing remarkable challenges and where your company might have distinctive opportunities.

A lawyer also helps to take minute steps that can help a company to gain an advantage in all sorts of legal circumstances. It is important that the Company selects someone who will guide them in critical legal issues and identify positive favorable opportunities.

To appoint corporate counsel as a director who is an insider to the legal community is priceless. They will have insider knowledge which can truly aid a company in its functions. 

A lawyer is mainly qualified to read between the lines, and has the eye for picking out details that one would not necessarily look out for. 

For example, a company that has been using a transactional lawyer and whose web page showed almost three-quarters of his work was dedicated to litigation. So this suggests that he was perhaps modestly qualified to draft basic documents, he was not a transactional expert. Thus, having an in-house lawyer will help one find such minor details which can help the company continue to grow exponentially. Lawyers can suggest a company to an extremely capable transactional lawyer whose main focus was advising startups.

A company should make an offer to anyone, who is an ideal fit for the company board. The candidate should understand business professionals and who  perhaps has had other business professionals as clients and connections.

Lawyers are familiar with contingency fees and hence, offering them an equity package as compensation for sitting on board will immediately inspire their professional experience.  The company target will balance the risk of failure with the possible monetary reward in a contingency case. If the lawyer thinks that the company has a good future and promise, he will accept the company offer. A legal professional will likely see to company offers as not only an opportunity to bring equity in a promising company, but also make a path for connections that could lead to more business. Generally, without work, a lawyer won’t survive and, even in a large international company, promotion normally depends on bringing new business. 

Ask prospective lawyers about their experience during the interview. The more it interlocks with the company’s needs and goals, the better suitable lawyer he or she will be. However, this should not only be a consideration. Company discussions should be aimed at spreading awareness of whether the prospective candidate is likable, punctilious and has the apt skill set while filling any position. This type of lawyer – the director will be an asset to the company. They work hard to make it a success and will have the respect and admiration of past connections that may help in future endeavors.

Hence, it is important to have a lawyer as one of the directors in the Startup Company as it will help the company to overcome legal challenges.