Startups in the Bay Area face a constant stream of demanding priorities. Whether it's product development, finding the right hires to grow your team, or raising the next round of funding, there is always something that demands your attention. 

But amidst this relentless drive to build your business, compliance is often seen as a hindrance—or worse yet, overlooked. The truth is that compliance is a vital concern, especially in your company's formative stages. Even a single regulatory misstep can derail a round of funding or invite a crippling lawsuit, grinding your momentum to a halt.   

For startups and technology companies that can't yet justify an in-house legal team, utilizing outside general counsel (OGC) services offers many benefits. 

SVTech, led by Thomas McKeever, has been helping startups and technology companies with general counsel legal strategies for growth and compliance for 25 years. Today, we'll highlight the advantages of outside general counsel for startups, including handling contracts and business agreements, and staying compliant with key industry regulations. 

How Startups Benefit from Outside General Counsel

The biggest organizations keep a costly in-house legal team, but startups or growing businesses likely don't have the budget for an entire legal department. That leaves many turning to law firms for help only when they need it. 

But this reactive approach is costly, and can leave you vulnerable in other areas. That's where retaining outside general counsel for your business offers a strategic advantage.

An outside general counsel attorney is an experienced legal professional who serves as a high-level legal contact and advisor for a company, but is not a full-time employee. 

General counsel services typically work on a fractional retainer model, providing continuous legal expertise for a predictable monthly fee. This offers startups and growing companies a cost-effective way to gain strategic legal guidance within their monthly budget. 

These are some of the key advantages of outside general counsel for startups: 

• Expertise on Demand: One of the biggest benefits of outside general counsel is access to specialized legal knowledge in areas like corporate governance, intellectual property law, and data privacy, in exchange for a fractional monthly retainer. 

• Cost Efficiency: Startups get the skilled knowledge of a senior outside general counsel attorney, without the overhead cost of salary, benefits, and office space for a full-time hire.

• Integration with Your Executive Team: Your outside general counsel attorney can attend board meetings, get to know your product intimately, and skillfully manage your legal risk. 

• Ensure Compliance: General counsel services can help you run a compliance audit, ensuring that you are compliant with data privacy laws like HIPAA, GDRP, and CCPA/CPRA.

• Preparation for Future Funding or Exit: A general counsel helps prepare a legal strategy for growth, making sure your cap table, IP assignments, and material contracts are pristine, helping preserve your company's valuation whether seeking funding or pursuing an exit strategy. 

Mitigating Risk: Handling Contracts and Business Agreements

From business formation to vendor and partner contracts, technology companies enter into a wide variety of business agreements and legal contracts throughout their lifecycle. Getting these contracts done the right way is the key to avoiding hidden liability risks and non-compliance. 

Using an outside general counsel attorney to handle contracts and business agreements offers significant advantages over using a traditional law firm on a one-off basis.

Because of this ongoing relationship, outside general counsel services can establish a central governance framework for key business documents that is both automated and scalable. 

An outside general counsel attorney helps with:

1. Standardization of Contracts: Development of a set of standardized, pre-approved templates for common transactions like SaaS agreements, NDAs, and employment contracts minimizes legal bottlenecks that can delay agreements. 

2. Risk Management: An OGC handling contracts and business agreements will adjust them to reflect your company's risk tolerance, focusing on high-impact clauses like indemnification, data security, and termination rights to protect your interests. 

3. Managing Compliance Obligations: Outside general counsel services can map your contractual and compliance obligations, giving your teams a clear picture of their responsibilities and keeping them accountable. 

4. Intellectual Property Protection: Your intellectual property (IP) is your core asset. A significant benefit of outside general counsel is ensuring the protection of your IP by reviewing employee and contractor agreements to guarantee that all IP created in their roles is assigned to the company. 

5. Mergers and Acquisitions: Outside general counsel attorneys keep your company M&A-ready, providing a clean legal slate that makes you significantly more attractive and valuable to potential investors and buyers.  

Staying Compliant with Outside General Counsel For Your Business

Partnering with an outside general counsel attorney is about building a long lasting relationship that can help you anticipate legal roadblocks and regulatory shifts before they become a liability. 

Outside general counsel services can help with compliance issues such as:

Data Privacy

California data privacy laws like CCPA/CPRA are constantly evolving. An OGC provides the essential legal experience to stay on top of the latest developments and keep your company compliant. 

Policy Implementation

General counsel legal strategy for growth focuses on drafting legally compliant privacy policies, terms of service, cookie notices, and other consumer-facing documents required for compliance. 

Internal Protocols

General counsel services also help organizations implement internal protocols for handling subject access requests (SARs), policies for handling data breaches, and for handling sensitive client or customer data in a compliant manner. 

Corporate and Board Governance

Corporations themselves have a legal obligation to document things like board resolutions and meetings. This ensures that major decisions are documented and formally recorded, protecting directors and officers from personal liability. 

Securities Compliance

Outside general counsel for your business offers advice on equity grants, option plans, and the filings required to gain compliance with state and federal security laws. 

Employment Compliance

General counsel services offer guidance in contractor vs. employee classification, an area where misclassifications under California's complex labor laws can lead to costly lawsuits. An OGC can craft internal employee policies and handbooks that comply with state and federal laws.

SVTech: Compliance with Confidence

The technology industry carries tremendous and unique legal risk. Without proper legal guidance, your company can quickly make a costly compliance mistake. 

That's why the benefits of outside general counsel for startups and growing businesses are too great to ignore.

Outside general counsel offers the ideal legal strategy for growth. With general counsel services you receive expert legal guidance and strategic foresight for a fraction of the cost of an in-house team, giving you the legal shield to grow your business in confidence. 

Led by Thomas McKeever, SVTech brings 25 years of experience helping startups and growth-focused technology companies in the Bay Area meet compliance requirements, handle contracts and business agreements, and define their legal strategy.

Don't let compliance issues derail your company's future. Contact SVtech today for an initial, no-obligation consultation and let us help your business stay compliant and ready for growth.

**Disclaimer**

The information provided in this blog post is for informational purposes only and does not constitute legal advice. Please consult with a qualified attorney to address your specific legal needs.