The Biggest Legal Mistake Entrepreneurs Make

By: Basha Rubin

Category: Blog, Freelancing, Get Hired

Entrepreneurs are always looking for ways to cut costs and maximize value.  Many think of legal services as an area of possible savings, trying to use DIY legal services to replace the advice and expertise of an actual lawyer. This strategy could lead an entrepreneur down a costly road.

While there are DIY legal services that entrepreneurs can use like customizable forms, documents, contracts or repurposing contracts from others, it is a mistake to think that DIY replaces lawyers. That said, you can there are certainly opportunities to leverage DIY options to save money while making sure you are also getting the benefit of quality legal advice.

The dangers of DIY.

There is a wealth of forms available via various online-document providers (and some are actually very good).  So often business owners believe everyday legal documents — employment contracts, leases, NDAs and terms of services — that can be adapted from a sample or template provided by a document service or colleague is sufficient. Think again.

Customizing documents without the counsel of a trained lawyer has serious pitfalls. Business owners can select the wrong corporate form, use a boilerplate contract with an employee or vendor that doesn’t account for the unique — and potentially troublesome — aspects of the business relationship or incorrectly file for a trademark or provisional patent.

Hiring a lawyer to remedy these errors or omissions after a problem has already occurred is far more expensive than getting it right the first time. Your business is unique, and so are your legal needs. While a majority of an off-the-shelf document might be applicable to you, the devil, as they say, is in the details. And lawyers are trained to issue-spot those details.

A good lawyer can understand what needs to be done based on exactly what your business does and how it does it. Even more important, your lawyer can make sure that your everyday legal documents make sense in the context of your broader concerns, hopes and long-term plans for your business.

Use DIY legal in conjunction with legal counseling, not instead of it.

There’s no question that DIY legal services (and the companies that have created them) have brought much needed innovation to the legal market.  The key is finding the right balance between cost efficiencies and expert advice.

DIY is generally best-utilized in conjunction with the advice of a lawyer. You can save money on tasks you execute while still protecting yourself with a lawyer’s counsel.  In the legal world, the word for this is “unbundled” legal services. Lawyers break down the representation into discrete tasks and only provide representation on certain tasks: It’s lawyers a la carte.

For example, an online document can provide a basis for a subsequent conversation with a lawyer — or even become the first draft reviewed by that lawyer. Using documents this way allows businesses to take advantage of valuable counseling without breaking the bank. Similarly, many services have automated and simplified legal processes (trademark filing and incorporation, to name a few). Businesses use these innovations to take care of execution — after working with a lawyer.

This blog post first appeared on

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