What Is It Like To Work As The General Counsel Of A Startup Company?
Words of wisdom from in-house lawyers at some of the country's most exciting startup companies.
Last week, Betterment and Above the Law hosted a great panel discussion about working as an in-house lawyer at a relatively young company. The event, hosted at Betterment’s spacious and airy offices in New York’s Flatiron neighborhood, drew a standing-room-only crowd of around 200 people.
How can you get a job as an in-house lawyer for a startup? And what’s life like once you’re there?
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Serving as panel moderator, I posed these and other questions to an all-star panel of five lawyers who are now working for some of the nation’s hottest young companies:
- Craig Abruzzo, General Counsel, Birchbox
- Eli Broverman, Co-founder & COO, Betterment
- Heather Dietrick, General Counsel, Gawker Media
- Jeremy Schwartz, Business Development Manager, Squarespace
- Chris Travers, Chief Business Officer and General Counsel, Bonobos
How can you land an in-house job at a startup company? Networking and connections are key, according to the panel. Compared to older companies, startups rely less on recruiting firms and formalized job-search processes, so knowing someone on the inside assumes greater importance. Sometimes lawyers help launch startups, as Eli Broverman did with Betterment. Sometimes lawyers have connections to non-legal personnel; Heather Dietrick, for example, had close ties to Gawker’s chief technology officer.
Conventional wisdom holds that there’s a certain “sweet spot” — a few years after entering the legal profession, but not too many years afterwards — in terms of when to move from a law firm to an in-house position. I asked the panel: is there an ideal time to make the move from a law firm to a startup? When they hire junior lawyers, are they looking for attorneys with a certain amount of seniority?
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On this question, the panelists agreed as well: in the startup world, your seniority matters less than what you can do, i.e., your range of skills — both legal and non-legal. Startups often have small in-house teams that cover, by necessity, a broad spectrum of issues, so generalists tend to be more desirable than specialists. And because startups are often leanly staffed even beyond the legal department, if you have additional non-legal skills — from accounting to coding to copy-machine repair, as Chris Travers joked — that’s great too.
What can you expect once you’re working at a startup? I asked the panelists to share their favorite and least-favorite aspects of their jobs. On the positive side of the ledger, Craig Abruzzo mentioned the fun of fundraising, Eli Broverman cited the ability to put your signature on a young and growing company, Heather Dietrick talked about the novel and interesting legal issues that constantly arise, and Jeremy Schwartz and Chris Travers discussed the satisfaction of coming up with creative solutions to challenging business issues.
As for the less appealing aspects of in-house life at a startup, Abruzzo said that the human-resources and employment-law issues aren’t always fun, and Broverman mentioned that startups can involve a lot of mundane legal work along with the exciting stuff. Dietrick noted that it can be tough working on a small team: compared to working at a law firm, there are fewer places to turn for guidance when you’re a startup lawyer. You can’t always ask a senior lawyer or a colleague in another department for their quick take on a problem, so it helps to have a good Rolodex (or lots of connections on LinkedIn) — you may find yourself calling up contacts to get their thoughts on various issues.
Schwartz and Travers talked about the business side when speaking about the best and worst aspects of in-house life. Schwartz mentioned that when a deal falls through, you feel it more acutely when you’re working at a startup rather than an outside law firm. Travers said that one of the toughest parts of his job is having to play the role of naysaying attorney to non-lawyer colleagues, explaining to them why a particular proposal won’t fly for legal reasons.
I asked the panelists to describe their relationships with outside firms — how they hire them, what they use them for, and some of their pet peeves with outside counsel. Most of the panelists said they hire individual lawyers, not firms, and that they are not averse to hiring small firms or solo practitioners over Biglaw shops, especially given the difference in cost. They turn to outside counsel typically for specialized matters — matters where, as Abruzzo put it, “you can’t make the call on a particular issue with confidence” — or for matters that are too big to handle internally.
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As for pet peeves with outside counsel, the panelists had a fair amount to say — much of it related to billing. Abruzzo doesn’t like it when law firms abuse the practice of passing through overhead expenses to the client. Broverman doesn’t like it when lawyers talk too slowly — understandable when you’re being billed by the hour. Dietrick doesn’t like it when outside firms “nickel and dime” her, charging for a phone call that takes just a few minutes. Schwartz gets frustrated by lawyers who doesn’t comprehend his company’s business and who don’t “get” particular deals and why they matter. Finally, Travers would like outside counsel to know that if you give him advice on an issue in a quick phone call, there’s no need to follow up with a 30-page memo restating that advice (and no need to bill him for that memo either).
During the question-and-answer session with the audience, one young lawyer aspiring to move in-house asked about risk — a topic that recurred throughout the evening, not surprisingly, given the key role that in-house lawyers play in helping to manage risk. This lawyer wanted to know: given the fact that many startups fail, how can you protect yourself against downside risk if you leave a stable law firm job to work for a company still in its infancy?
Trimming your expenses, living within your means, and saving as much as possible before you make the jump are wise moves. Not all startups are flush with venture-capital money, especially in the early stages; as Chris Travers of Bonobos joked, for the first few weeks of his employment he was paid in pants. Eli Broverman of Betterment noted that you can also mitigate risk by getting the best experience possible once you’re at your startup, to give yourself the widest range of legal and business-world exit opportunities in the event that the company doesn’t flourish. If you’re willing to take the risk, the rewards of working for a startup — interesting and enjoyable work, the excitement of building a new enterprise, and perhaps post-acquisition or post-IPO riches — can be great.
Once again, thanks to Betterment for sponsoring such an enjoyable and enlightening event. If you’d like to learn about how Betterment can help you improve your financial picture and manage your money in a cost-effective manner, click here for a special offer for Above the law readers.
6 Tips for Becoming a Startup Company Lawyer [Betterment]
Earlier: Innovative Lawyers: A Night With NYC’s Premier Start-Up GCs
