Expert Network Services Help Entrepreneurs Conserve Cash and Establish Ongoing Provider Relationships
Susan Rector, partner at Ice Miller, is an engaged service provider in the Expert Network (EN) program working directly with TechColumbus clients on specific legal issues as well as providing excellent feedback and ideas for the Expert Network (EN) program as it continues to evolve.
TC: In the last year or so, the Expert Network program has really taken hold with our entrepreneurial clients. What is it about EN that attracts service providers?
SR: Now that the entire entrepreneurial ecosystem is under the umbrella of TechColumbus, a program like Expert Network can be much more effective. There are a couple of things that distinguish this program and make it an effective way for us to contribute to the entrepreneurial community.
TechColumbus sees a wide variety of deal flow and performs an important screening function. They send us companies that have made progress, have met milestones, and have the promise of future growth. That lets us spend our time helping companies that have a realistic chance of moving forward.
TechColumbus also sets realistic expectations with entrepreneurs and encourages them to prioritize their legal needs as they work with us.
TC: What types of work do you perform through Expert Network?
SR: We provide services in four general areas. We perform intellectual property analysis to determine the best means of protecting startups’ proprietary property, including doing the necessary research to find out if the process or technology is patentable. We also help with obtaining patents, trademarks, or copyright registrations.
Second, we assist companies with their legal needs in conducting business online.
A third area is corporate finance, for example structuring terms for accepting investments from friends and family that will not preclude additional funding from outside investors at a later date.
Finally, we also assist entrepreneurs with labor and employment issues. The legal issues with hiring people aren’t always intuitive. One specific example that we’ve dealt with is wage and hour implications of engaging interns; not all students can work without pay, even if in this job market they are willing to do so.
TC: How does an Expert Network engagement with Ice Miller begin?
SR: During an initial consultation, we ask the entrepreneur to tell us what he or she wants to accomplish. We go through the client’s list of priorities and the timeframe for each. We also take the time to ask about their business and understanding their operations because there are legal needs that they don’t necessarily know to tell us about.
At the beginning, we really emphasize the company’s intellectual property strategy. The company is always going to get questions from investors about IP. Even if there may be no way to patent the technology, there is usually trademark registration available to protect the product or service name.
TC: You also focus on company structure, right?
SR: Absolutely. The entrepreneur needs to be sure that the company structure, for example LLC or C corporation, matches the company’s investment and financing objectives. If a change needs to be made in the company structure, it’s always easier to do earlier than later.
Another thing is to make sure that the company from the beginning is formed with a legal structure that protects the founders from personal liability and gives the owners the desired tax consequences. We can help entrepreneurs to be mindful of the very basics of how they get started and form a company.
TC: What about in the area of software development?
SR: Whether development is being done by an employee or a subcontractor, just because the company is paying, doesn’t mean the company will necessarily own the software. We have seen even established companies be tripped up by this point.
TC: The Expert Network program helps entrepreneurs up to a point, but eventually every successful company will incur legal fees.
SR: Yes, and we talk with the entrepreneurs about that up front. Through Expert Network we typically provide a generous, but limited about of legal services pro bono. We’ve done this enough now that we have a sense of how far an entrepeneur will get with those funds.
One of the ways we’ve worked successfully with some clients to continue doing billable work as they progress and have further legal needs, is for them to pay a portion of the fees as we go and the balance at the company’s first funding event or other predetermined future date.
TC: Would you comment on the importance of ethics and trust in business.
SR: Entrepreneurs need to be open and honest in dealing with all their professional advisors. Word gets around quickly in the community about who is trustworthy and who is not. Saying what you intend to do and doing what you say is all-important. We can serve as a sounding board for entrepreneurs who have questions as to what is proper or expected.
TC: We’ve found that the connections that entrepreneurs make through Expert Network are beneficial beyond the services they receive.
SR: We have extreme enthusiasm for what TechColumbus is doing. In addition to helping clients through in-kind services, Expert Network was been a good resource for clients, connecting them with other professional resources, customers and funding. There’s no easy way to make these connections, particularly when a company is so small. The work that TechColumbus is doing with startups by being the connector in the community is a great illustration of the additional value TechColumbus brings to entrepreneurs in the Expert Network program.
Susan D. Rector is a partner at Ice Miller LLP representing companies in business transactions and all aspects of intellectual property ownership and information technology transactions. Susan assists startups and established companies with commercializing technology and conducting business online. She is a remarkable resource to the entrepreneurial community in the Columbus region and beyond.