Category Archives: law

How to Build a Killer Team

Nothing is more exciting for founders than that first moment when they take their destiny into their own hands. After putting in the hard work and research using the Lean Startup Model, and determining that the product or service you have developed is really desired by customers, it’s finally time to bring your vision to life.

Now it’s time to identify who you need to join you to grow and protect your business. There are well defined as well as unexpected challenges ahead that are beyond the scope of just one person, and it’s up to you to identify the kinds of people you need behind you – those with the right experience and expertise – to face those challenges. You also need to know when you will need them.

Facebook’s CEO Mark Zuckerburg recognizes the power of a good team. “The most important thing for you as an entrepreneur trying to build something is … to build a really good team. And that is what I spend all my time on.”

What Skills Do You Outsource?

At the very beginning, you probably did a little bit of everything in order to put your plan into action. However, a few more people with specific expertise will be needed to help you go beyond the nuts and bolts of creating the business. These are the types of people you will need to make sure your business has the right financial and legal footing to hit the ground running:

  • An experienced startup accountant
  • An experienced corporate lawyer
  • A banker – Finding a banker that is willing to dig in and understand you and your business will be a valuable resource for the future. By winning this person over, you won’t be viewed as another commodity and source of a fee. Instead, you’ll have a valuable partner that will more likely be a source of financial support to help grow your business.
  • A reliable outsourced bookkeeper
  • Product Development – This is an area that can be outsourced as well. However, be sure you control the vision and the strategy. If you have the skills and experience in house, keep it there.

All Hands on Deck

Next, as the founder, you need to assess your own competencies. Be brutally honest about acknowledging your strengths and weaknesses, and the type of person you will need to fill the gaps in terms of both skill and time.You should have a very strong vision and clear goals for the company after defining and redefining them with the startup model, so you can proceed to identify the skillset you will need to make your business a success.

Identify what you need, from product or service development, sales, marketing, project management, to operations, and who be responsible for these things. Sometimes that person will be you, the founder, and other times, you will have to evaluate who to bring onto your team.

Finding someone with the right experience and expertise isn’t the only only criteria you need when vetting a potential teammate. A candidate could be the best in the business, but if you can’t stand him or her, it’s probably best not to lay down an offer. Here are some things to consider when looking at future teammates for your business:

  • Vision – It’s important to look for candidates that are passionate about the vision you have for the company. Founders must communicate the big-picture goals they have, and provide a potential teammate with an opportunity to make a difference.
  • Diverse Knowledge – Find candidates with knowledge and skills different from your own, so that your team is well rounded and prepared to deal with any challenges that arise.
  • Continuous Improvement – Look for evidence of learning ability. Someone who has learned from the past and will adapt their knowledge to future challenges at your company is a prime candidate for your Lean Startup Model mindset.

If you have found people with the right experience, expertise, and characteristics, you will have a found the right players to join your killer team to bring your business to life.

Written by: Judson Sutherland, Founder & CEO

Sutherland, PLLC –

5 Characteristics Every Entrepreneur Needs To Crush it

The light bulb went off. You have an idea that you sincerely believe will launch you to success; the only thing left to do is to take the leap and start your own business. But do you have what it takes to succeed?

Starting a business is a courageous feat. It’s attractive to be your own boss and call all of the shots, but it is also comes with challenges like having the tough conversations and the weight of success or failure on your shoulders. Entrepreneurs must possess a few unique characteristics in order to achieve success. If you are thinking of beginning your own entrepreneurial journey, ask yourself if you have these 5 crucial characteristics that will help you propel your new business to the next level:

1. A bizarre sense of optimism. Entrepreneurs are pathologically visionary and believe that their ideas will work, no matter what. They believe that everything will ultimately play out for the best, and they will reach their targets with smashingly successful results.

Optimism not only drives entrepreneurs forward, it also helps them recover quickly from disappointments or failure. According to Barbara Fredrickson, author of Positivity and professor of psychology at UNC-Chapel Hill, “When people are able to self-generate emotion or perspective, that enables them to bounce back. It’s not just that you bounce back and then you feel good – feeling good drives the process.” It also helps to have a short-term memory, making it easier to leave the mistakes in the dust and focus on the bright road ahead.

2. Grit and perseverance. Entrepreneurs have a superhuman strength of character that allows them to handle every situation that comes their way. That passion, perseverance and stamina is grit, and it sets them starkly apart from the general population. Entrepreneurs with this trait are fueled with motivation and a strong work ethic that leads them to pursue their goals until they become a reality.

Muhammad Ali once famously responded to a reporter, “I don’t count my situps, I only start counting when it starts hurting, when I feel pain, ‘cause that’s when it really hurts.” Winners push through the pain to achieve their dreams. That stick-to-it-iveness and willingness to face both the ups and the downs is what gets entrepreneurs ahead.

3. Comfort taking calculated risks. For entrepreneurs, uncertainty and ambiguity are necessary to discover possibility. Smart entrepreneurs assess which risks are worth taking with hopes of a high reward – they enjoy the thrill of exploring the unknown.

Even a big risk-taker and well-known founder like Richard Branson believes in devising a worst-case scenario when evaluating if risks are worth taking. While planning the launch of Virgin Atlantic, Branson convinced the board of Virgin Records to start an airline by demonstrating that the company would lose only six months of profit if the plan failed. Entrepreneurs succeed when they can minimize risks while being open to crucial decisions and opportunities.

4. Life-long learners and innovators. Entrepreneurs are always conceptualizing ways to make things better. By refining their skills and continuing to ask critical questions, they are able to create efficiency and make the biggest impact wherever they go. Founders focused on growing stable companies seek knowledge constantly: they read, brainstorm, and share their experiences with other entrepreneurs. That thirst to learn keeps them fresh and on the edge, ready to generate new ideas.

5. Charisma and conviction. JFK had it. Successful entrepreneurs like Steve Jobs had it too. Entrepreneurs possess a rock star quality that can be used to inspire devotion from others in a way that is compelling and attractive. They radiate authentic enthusiasm, and can convince both customers and business partners to share in their closely held convictions and help their cause.

According to Nolan Bushnell, founder of Atari and Chuck E. Cheese’s: “The critical ingredient is getting off your butt and doing something. It’s as simple as that. A lot of people have ideas, but there are few who decide to do something about them now. Not tomorrow. Not next week. But today. The true entrepreneur is a doer, not a dreamer.”

So do you have what it takes to be an entrepreneur? If the answer is yes after identifying with these crucial traits, take Nolan’s advice and start doing something about it today!

Written by:  Judson Sutherland, Founder & CEO

Sutherland, PLLC –

FoundersGuide: What is Private Placement?

When a company sells shares of its stock (or limited liability company membership interests or partnership interests) to third party investors, an offer and sale of securities has occurred. The general rule both under US federal law and state securities laws is that all securities must be registered unless the offer and sale qualifies for an exemption from the US federal and state securities laws registration requirements. Registration is a costly process that requires extensive interaction with the SEC and generally is a task undertaken by companies with larger capitalizations. Legal fees alone can range into the hundreds of thousands of dollars. An example of such a company would be any company whose securities are freely tradable on a public stock exchange, such as NASDAQ or NYSE.

A securities offering exempt from registration with the SEC is sometimes referred to as a private placement or an unregistered offering. Generally speaking, private placements are not subject to some of the laws and regulations that are designed to protect investors, such as the comprehensive disclosure requirements that apply to registered offerings. Private and public companies engage in private placements to raise funds from investors. Hedge funds and other private investment funds also engage in private placements. The transaction costs (i.e., legal fees) for a private placement almost always will be substantially lower than with a publicly registered offering.

As an individual investor, you may be offered an opportunity to invest in an unregistered offering. You may be told that you are being given an exclusive opportunity. The opportunity may come from a broker, acquaintance, friend or relative. You may have seen an advertisement regarding the opportunity. Keep in mind that private placements can be very risky and any investment may be difficult, if not virtually impossible to sell. On the buy side, while you are buying a bona fide interest in the company, you may not know all of the implications associated with the investment, and that is why it is so crucial to engage an attorney to represent your interests.

If you are a company that is interested in selling its securities to raise capital, it is very important to understand what your specific obligations are to your investors so that you can avoid the risk of liability for securities fraud. Selling securities in a private placement can be a great tool to raise capital for your company, but it is a substantial undertaking and should not be attempted without the advice of an experienced securities attorney.

Written by:  Roland Wiederaenders

FoundersGuide: Advertise Your Securities in the Newspaper

If you ever raised money for your business through the sale of securities, you probably are at least somewhat familiar with United States federal and state laws governing the sale of private securities.  Specifically, these laws provide for exemptions from the general rule that all securities must be registered (i.e., publicly-traded) before they are sold to investors.

Historically, Rule 506 under Regulation D (of the United States federal Securities Act of 1933, as amended) has been the most commonly used exemption from the U.S. federal securities registration requirements.  Nearly all states have an exemption that corresponds to this federal-level exemption.

Recent changes to Rule 506 have added a new exemption, Rule 506(c), that is very similar to the old exemption with a key distinction: an offering of securities under Rule 506(c) may employ advertising and general solicitation.

Previously, no advertising or general solicitation was allowed in connection with sales of private securities.  Consequently, it was not permissible to buy advertising space in a newspaper or magazine to notify the world that you were attempting to raise money through the sale of interests in your business.  Importantly, this prohibition against print advertisement meant that companies also were not allowed to use the internet and their websites to sell their private securities.

While Rule 506(c) allows for general solicitation and advertising, it imposes an additional requirement from the old Rule 506 exemption that ALL investors participating in the offering must be “accredited investors”.  Whether an investor is accredited differs for individual investors and investors that are business entities.  Individual investors may qualify as accredited investors either by having a net worth of at least $1 million (excluding the value of their principal residence) or an annual income of at least $200,000 (or $300,000 together with their spouse) and a reasonable expectation of earning at least those amounts in subsequent years.  Business entities generally qualify by satisfying a $5 million minimum net worth requirement.

Under the old Rule 506 exemption (and continued under the Rule 506(b) exemption in effect now), an issuer may rely on self-certification that an investor was accredited.  This typically was obtained by asking the investor to complete and sign a questionnaire. The SEC specifies now that under Rule 506(c), the reasonable steps the issuer must take to verify that its investors are accredited include reviewing documentation, such as W-2s, tax returns, bank and brokerage statements, and credit reports.  For individual investors, tax returns, pay stubs and W-2s readily document that the investor satisfies the accredited investor minimum income requirement.  If an investor is not willing to provide this type of information (and many are understandably reluctant to, particularly because self-certification has been the standard for so long), the issuer should rely on self-certification and not use advertising or general solicitation in connection with the offering.

Advertising and general solicitation can be powerful tools for your fundraising efforts.  Please let us know if you are considering using advertising in connection with your securities offering.

Written by: Roland Wiederaenders

FoundersGuide: Make the Most of Your Time

Communication is key to most successful interactions. It is especially important when your attorney is charging hourly rates, or more importantly, trying to distill all necessary information from you in order to best represent you and your interests. Face to face meetings are a rewarding and essential part of the attorney client relationship. In person interaction develops the bond that breeds the trust necessary for open and clear communication to take place and move a founder or business owner toward their goals.

As attorneys, we are counselors, but we are constrained by time when meeting with our clients. First and foremost, we respect our client’s time, but even if we spent an entire afternoon with a client, effective communication requires both time and thought. Unclear communication can cloud the attorney client relationship and impede our efforts. The best thing we can do, and our clients can do, to prepare for any meeting is to think about the meeting and what we want from it.

So how do we prepare? How should you prepare? Beforehand, dedicate time to thinking about the upcoming meeting. Clarity around the following questions helps us, your attorneys, zero in on what we need in order to better understand your needs.

  1. What do you care about most? Write down what you really value.
  2. What is your goal? Do not try to create a laundry list, but try and clearly describe the goal that you need help on from the person you are meeting.
  3. What are your biggest threats around that goal? Again, no laundry list needed, just try and narrow it down to the key threats and try to identify what is keeping you from accomplishing your goal.

Answering these 3 simple questions will not only help you prepare the development of your better communication in any meeting, but also helps us, as your advisors, focus on where and how to guide our strategy. Taking quiet time and space to prepare for meetings is important because communication is the foundation of relationships. It not only gives you clarity, but helps us better understand your needs, and better cue in on what questions to ask, and information to seek. Through these efforts we aim to understand your needs, and best serve you.

Written by:  Santiago Diaz

3 Tips on Winning Top Talent for Your Startup

Contrary to what many budding entrepreneurs think, a business start up can compete and win top talent in the market without much cash. Here are three tips for attracting and retaining the best talent.


In your search for top talent, pay attention to high potential workers who are looking for a new adventure. Many large corporations tend to stifle talent and many top performers feel restricted in such environments. With a good pitch, you can offer a restless employee a new lease of life by offering them a position in your business start up that will give them the freedom to fulfill their career aspirations. For instance a talented middle level manager will seriously consider a VP post in your startup if you find that this is one of their career aspirations.


Facebook and Google both used equity to retain top talent when they were still startups. They offered stock options to some of their initial employees. Even the most talented employees have the desire to own something more than their generous paychecks. Many big corporations do not have this option. Dedicate a percentage of your equity to retain your top talent if you realize that this is what will secure for you the best talent in the market.


The third way you can attract and retain top talent for your starts up is by focusing on people who have an entrepreneurial mindset. In other words, find fellow entrepreneurs who are yet to launch, maybe because they are held up in an eight to five job, and give them an opportunity to test their wings. A business start up not only needs employees who will stay with it until it matures, but it also needs a set of entrepreneurs who will take the risks needed for it to grow.

Written by:  Judson Sutherland, Founder & CEO

Sutherland, PLLC –