*This blog post was written by Chandler Holsapple, who is an amazing lawyer for entrepreneurs. Her website and social media pages are linked at the bottom of the page* 🙂
If hearing the word “lawyer” automatically makes you want to run the other direction because dollar $igns (CHA-CHING!) pop in your head, keep reading.
When starting and operating a business, there are many roles you must play and branches you must build, including: branding, marketing, administrative, finance, and legal. So when you tackle a project in one of these branches, you have two options: DIY or delegate.
Some things you can handle yourself. You may be really creative, so you can hone in on your brand colors and vision. You may be a pro marketer and can sell anything, so you have that on lock. But unless you’re a licensed lawyer, this is where it’s necessary to delegate. Working with an attorney shouldn’t be deemed optional—but lucky for you, it can be cost effective. but it can be cost effective.
Law firms are changing and adapting to meet the emerging needs of the online world. Many firms, myself included, operate virtually. This means we don’t pay rent for some big office and fancy board room. In turn, we lower our overhead costs and charge clients less for legal fees.
So how much moola we talkin’? I’m going to provide you with two scenarios.
Carly decides she wants to start a life coaching business. She talks with an attorney and determines how to lay a solid legal foundation to protect herself, her business, and her brand. Carly and her lawyer determine she needs a LLC, a customized service contract, a few contract templates, and a trademark for her brand name. The cost of working with an attorney to accomplish this would likely look like this:
LLC registration: $400-600
Customized service contract: $800-1500
Non-disclosure agreement template: $200-400.
Independent contract agreement: $200-400.
Trademark registration: $1200-2000.
On average, the overall investment would be around $4,000. Keep in mind, with this full package approach, Carly is setting a solid legal foundation for a successful business, and she will be able to scale with peace of mind knowing she is protected because she covered her legal bases in the beginning.
Sam started her life coaching business on a whim and never worked with an attorney to create a solid legal foundation. She didn’t ACTUALLY think anything bad would happen, so she took the risk. She built a very popular six-figure brand in just under a year and still doesn’t have an LLC, contracts, or a trademark.
Sam just found out she’s being sued. The person suing her won the case, and since she didn’t have an LLC to protect her personal assets, they were able to take her house AND her car, together valued at $350,000.
Sam was just relying on her clients to pay her but never had a contract in place detailing the terms of payment. 20 of Sam’s $2,500 clients found out about the lawsuit against her and decided to stop paying her even though Sam ha already provided them hours of coaching. Sam has no recourse because she didn’t have contracts in place, so she is losing out on $50,000.
Sam had 2 $5,000 clients sign a contract that she downloaded off the internet from a random site, and decided to enforce the contract in court because they weren’t paying up. Unfortunately, the contract wasn’t solid so she lost her case. Not only did she lose $10,000, she spent $75,000 in litigation and attorney’s fees.
Oh, and just when Sam is thinking things can’t get any worse, she discovers that someone is duplicating her courses and selling them for profit. But she didn’t copyright her intellectual property, so she is S-O-L (shit out luck). And Sam’s big popular brand? Turns out she was infringing on a company’s trademark. Even though it was an accident, she’s still on hook and the company is suing. If only she would have worked with an attorney from the start, Sam could have protected her intellectual property and ensured she wasn’t infringing on anyone else’s.
All of Sam’s issues could have been prevented had she worked with an attorney. The cost that Carly invested to create a solid legal foundation is minimal compared to the grave costs Sam faces because she failed to do the same.
Your business isn’t something to play with. It’s simply not worth the potential costs and liability you face by failing to cover your legal bases. You never think these things are going to happen to you, until it does. Be proactive and invest in an attorney to protect yourself, your business, and brand.
Moral of the story: Carly is smart. Be like Carly.
A Note From the 21 Year Old CEO
If you loved this blog post as much as I did, please go visit her site at https://www.chandlerjlaw.com/! Chandler is aboslutely amazing at what she does and was even a guest on the podcast where she gave some super juicy legal information.
You can also check out her social media here —-> https://www.instagram.com/lawyerchandlerj/