I’m a Start-up: Should I Use Rocket Lawyer to Help Me with my Legal issues?

By: Rebecca Ney

The Moment of Truth in the Legal Industry, or Is It?

There are websites, such as Rocket Lawyer, Contractology, Avvo, LegalZoom, and Template Monster that allow entrepreneurs and companies to find legal templates and gain legal advice. These websites bypass the process of retaining the services of an attorney or law firm.

The relationship between the user and the website is akin to several other popular apps and websites: OpenTable allows the diner to make a reservation, instead of speaking to the hostess at a restaurant; Uber allows the rider to find a ride instead of hailing a taxi or speaking to the dispatcher at a car service company; TurboTax allows the tax payer to file taxes instead of consulting with a tax accountant; and WebMD enables a sick person to diagnose his or her ailments remotely instead of heading to the doctor’s office. The parallel is that these websites and apps remove the human element from the equation. Even David Byrne sees the parallels.

The legal profession, as with many industries, is in flux due to the “disruption” emanating from Silicon Valley. A recent New York Times article, “A.I. Is Doing Legal Work. But It Won’t Replace Lawyers, Yet,” provides an overview of this disruption. The article concludes that there are specific and niche legal services that businesses are willing to pay for, yet, some of the more routine legal work can now be completed by A.I.

Where does this leave the start-ups and entrepreneurs seeking legal advice? The below sections of this post outline both sides of the discussion, and provide you with answers to this question.

The Benefits of Legal Advice Websites

As a start-up or a small business, online legal resources are attractive options because googling, “how to form a C-Corp” and finding the answer with the click of the mouse seems more bearable and less time-consuming than contacting an attorney and paying legal fees.

There is a myriad of ostensible benefits to these legal advice websites:

·         Cost savings;

·         No need to be in direct with an attorney;

·         Clearer ownership and control over the process;

·         Provides entrepreneurs with foundational legal knowledge;

·         Free and direct access to legal resources;

·         And again, cost savings.

The cost may be the biggest reason that a young company would want to avoid retaining legal counsel. Especially, at an early stage, a start-up likely does not have the funds to hire a lawyer. Furthermore, these legal advice websites bring legal advice to the masses. Arguably, this creates a more informed body of entrepreneurs. Lastly, these advances also help lawyers: the websites enable lawyers to focus on the gray areas of clients’ issues, while allowing these websites to handle the rote drafting.

Through the advent of these websites, legal advice is a Google search away (and does not break the bank). The question becomes: why do I need a lawyer if Rocket Lawyer provides all the answers?

The Risks Associated with Legal Advice Websites

While these websites provide entrepreneurs with immediate access to legal resources, issues may arise during this process. An entrepreneur may not be versed in legal vernacular, and as a result, the information that the user inputs into the legal service website may be incomplete or inaccurate. In turn, the answer that the website automatically spits out may be wrong. This will place the entrepreneur at a disadvantage.

Furthermore, young entrepreneurs may not know that they may benefit from the services of a lawyer. As such, an entrepreneur may blindly follow the advice provided by these websites, without knowing the nuances that only a discussion with an expert could provide. Lastly, the websites may not be up-to-date on the most recent legal advice, or there may be different state requirements, and the website only provides federal information.

There Is a Balance to Strike

Lawyers are not going away anytime soon. According to a Massachusetts Institute of Technology (MIT) study, the authors, “estimate that automation has an impact on the demand for lawyers’ time that while measureable, is far less significant than popular accounts suggest.”

Instead, according to a McKinsey & Company study, the automation will transform, and not eliminate jobs. This type of change will enable certain tasks to become automated. Furthermore, according to a Harvard Business Review article, these automated systems will create consistent precedents, streamline documents, and allow for routine tasks to be taken on by machines. These developments will ultimately allow lawyers to focus on less menial tasks, and instead, focus their energies on “the tricky stuff that calls for judgment, creativity, and empathy.”

Proceed with Caution:

The Best Ways to Use the Legal Advice Websites

While the legal advice websites may have many benefits, there is a certain way to use them.

Below is a general step-by-step process to follow:

·         First, look at the various websites to get a lay of the legal land. If you are unsure whether you want to form a C-Corp or an LLC, look at the websites to inform you. You will be able to gain a better sense of the language and the issues relevant to your business.

·         Once you believe that you have hit a wall in your research, try contacting a law firm or one of the free local legal clinics listed below.

·         At that point, get the conversation started: you can provide the clinic or the lawyer with the information that you have at that time and let them know your future goals. You want to paint a clear picture so that the experts have all the relevant information.

·         Then, allow the experts to provide you with their analysis and advice.

·         In the end, you can combine your research in conjunction with the experts’ advice to help you land on the best results.

In forming your business, hiring employees, granting stock options, and selling your product, you have put in a lot of time and energy to create your business. Thus, you want to ensure that all your I’s are dotted and T’s are crossed.

In conclusion, this is not the reckoning moment for the legal industry. Lawyers can work in conjunction with automation; and start-ups can work in conjunction with lawyers. There should be a symbiotic and successful relationship amongst these parties.  

Next Steps for Entrepreneurs

If you are an entrepreneur or young start-up looking for free legal advice in the Boston-area, here are some legal clinics at the local law schools:

o   Boston College Law School Entrepreneurship & Innovation Clinic

o   Boston College Law School Community Enterprise Clinic

o   Boston University Law School Entrepreneurship & Intellectual Property Law Clinic

o   Northeastern University School of Law Community Business Clinic

o   Suffolk Law School Intellectual Property & Entrepreneurship Clinic

o   UMass Law Community Development Clinic

o   Harvard Law School Community Enterprise Clinic

o   Harvard Law School Transactional Clinic

Please make sure that the clinic’s type of legal service is relevant to your business.

We wish you the best of luck on the success of your business.