Start-Up Lawyers

29 01 2010

Mark Suster, an entrepreneur who is now a GP at GRP Partners in 2007 as a General Partner, has a very informative blog post (How to Work with Lawyers at a Startup) over at his blog, Both Sides of the Table.  He discusses the importance of a start-up finding the right lawyer, and provides some useful tips when doing one’s search. 

Being a lawyer for many start-ups, it’s always nice to see a non-lawyer emphasize the need for the right legal representation.  As I continually tell potential start-up clients, when thinking about legal representation, start-ups should consider it a part of its team-building efforts, just like getting the right management.  In addition to Mark’s advice, I would add:

  • Make sure the lawyer “gets” what your business/product is trying to do and how it works.  A good start-up lawyer will have some understanding about the current marketplace, or, at the very least, has the ability to understand the jargon that you’re throwing at them.  A good sign is for the lawyer to be asking you as many questions about your product and business as you’re asking them about legal issues.
  • A lawyer should fit your company’s culture and attitude, and complement it rather than conflict with it.   Really, a company can only figure this out after working on a few projects with a lawyer, but, during the course of such work, your lawyer doesn’t start to anticipate what your concerns will be, it may be time to start the search for a new one (or, at the very least, broach the subject with the lawyer to see if he/she changes).
  • Mark mentions in his blog that most start-up lawyers secretly want to be entrepreneurs, and I think this is spot-on.  I know that I tried my hand at a couple of start-ups before moving to law full-time.  When searching for a lawyer, start-ups should keep a look out for lawyers and firms that have fostered, and continue to foster, this entrepreneurial attitude.

- Gregg J. Lallier


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LaunchCapital Small Business Product

6 11 2009

LaunchCapital is a Cambridge, MA-based firm focused on early-stage financing, with offices located in New Haven, CT.  It has recently unveiled “LaunchCapital Small Business” (LCSB), which is a lending product for small businesses (See description from LaunchCapital here).  LCSB lends up to $150,000 to early-stage, small businesses that are within six months of gaining revenue.  Because of the high-risk nature of such loans, LaunchCapital will receive a small equity stake in the businesses rather than charging high interest rates.

Another innovative way that LaunchCapital is helping to keep entrepreneurship going in the marketplace.

-Gregg J. Lallier


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Categories : Start-Ups, Technology, Venture Capital

Alternatives to VC Financing

6 11 2009

Start-ups should give a read to a recent Mass High Tech article entitled Cleantech tries on corporate funding and expertise in lieu of venture capital.  It talks about cleantech companies like, A123Systems Inc., looking at strategic investments from other operating companies as an alternative to venture capital investment.  Although the article centers around cleantech, it has validity for most hi-tech start-ups.  Given the tight VC market, start-up tech companies need to be creative about sources for the capital needed to get to their next stage of product/business development.  Furthermore, larger companies have significantly cut back on their R&D departments, and may be looking for these types of strategic investments as an alternative to their in-house R&D. 

-Gregg J. Lallier


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Lowdown on LILO’s

16 04 2009

Very interesting article in this week’s Time magazine regarding LILO start-ups (“The New Internet Start-Up Boom: Get Rich Slow“).  “LILO” stands for “little in, little out”, connoting the low overhead (“little in”) and slow, steady growth (“little out”) of internet-based start-ups. 

The LILO business model, much like the virtual company business model (which I discussed in an earlier post, here), takes advantage of the high-bandwidth broadband connections that are widely available now to put a valve on various costs and expenses (e.g. office space, administrative help, etc.).  This handling of costs allows for companies to take a more viral approach to growth (as opposed to the boom-bubble, volatile growth that we witnessed during the dot-com boom of the late ’90s).  Further, it means that LILO do not need to rely on heavily valued venture capital money (which will dilute a founder’s share).  Finally, much like virtual companies, LILO start-ups, with their low overhead structure, can survive (and even continue to expand) during the market-downturn, making it all that much better position to take advantage of exponential growth when the market picks back up.

Just another innovative way that tech entrepreneurs will help turn the tide.

- Gregg J. Lallier


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Categories : Intellectual Property, Technology

REvolution Computing on the Watch

15 04 2009

REvolution Computing of New Haven, CT made this week’s “Startup Watch:  Five you should follow” at MassHighTech.com.

According to REvolution’s website:

REvolution products provide performance optimization, scalability, and commercial support of the open source R language for statistical computing.  The REvolution R product suite enables analysts, statisticians and scientists to derive meaning from mission-critical data in record time and to deploy analytics in research, production and regulated environments.

- Gregg J. Lallier


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Google Launches New VC Fund – Google Ventures

1 04 2009

 

Google never ceases to amaze me. 

Get it straight from the horse’s mouth at Google’s office company blog where Rich Miner and Bill Maris, Managing Partners of Google Ventures, post:

At its core, Google Ventures is charged with finding and helping to develop exceptional start-ups. We’ll be focusing on early stage investments across a diverse range of industries, including consumer Internet, software, clean-tech, bio-tech, health care and, no doubt, other areas we haven’t thought of yet. Central to our effort will be our fellow Googlers, whom we view as a critically important resource to help educate us about potential investments areas and evaluate specific companies.

Pretty interesting idea to leverage Google’s army of “Googlers” for its VC business development….as always, Google being creative.

- Gregg J. Lallier


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The Need for Seed

26 03 2009

As anyone who works in the VC/start-up tech space knows, the availability of seed financing for start-ups in the area has been dwindling in recent years, and such scarcity has only become more pronounced in the current tight market conditions.  This is especially true for start-ups in Connecticut, where, outside of the Seed Investment Fund of Connecticut Innovations, seed/angel investors are hard (if not impossible) to find.

Given the scarcity of seed, it is great to hear about the new seed financing initiative being started by Spark Capital called “Start@Spark” .  According to the initiative’s website, Spark Captial started the program because:

[w]e believe that providing entrepreneurs access to early stage capital is critical in building a vibrant eco-system of innovation.  Unfortunately, as our economy works through this time of economic difficulty, normal sources of early stage funding have been reduced.  Fewer angels are investing aggressively and many top tier institutional investors are turning their attention to their existing portfolios.  In this funding environment, Start@Spark is an important source of both capital and acceleration for entrepreneurs.

Start@Spark will initially focus on companies in the Boston and New York areas within their focus area of technology, media, and entertainment.  Their investments “span the full value chain in this sector, including gaming, technology platforms, mobile, advertising, consumer applications, infrastructure, and hardware”.  More details of the program can be found here, and their on-line application for funding can be found here.

It will be interesting to track the activity and success of Start@Spark, as its success may be able to not only “spark” the building of new businesses, but also “spark” the creation of new, much-needed seed sources.

- Gregg J. Lallier


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