This is the second post in a two-part series about How the Right Legal Team Can Help Your Startup Grow & Prosper with Switch.co’s General Counsel, Marlo Stroud. Previously, Marlo worked at CTIA-The Wireless Association as well as a law firm specialising in telcom, energy, water and transportation regulatory compliance.
In Part 1, we finished up by talking about how these certifications help us stay competitive, but is it always easy to convince people that they are worth pursuing?
I think that’s a question to which any general counsel at a startup would have an interesting answer. It can be tough, at a growing startup there are a million things that need doing all the time and things like legal compliance are not realistically going to be a priority when there is a focus on getting a product out, acquiring customers and users, etc. That being said, it's still important to keep an eye on things, because it can very easily come back to bite you at a later time.
Whether you’re going to go public or get acquired, if there are unsavory things that come up during the due diligence process it can have a significant impact on your business. You might have the best product in the world but if you get hit with a high fine by the FTC, it can really make things tough on you. A lawsuit or a fine will leave a black mark on your company, and possibly your own reputation. In some cases, a mark on your company will even cause some states not to approve your application to do business inside of their borders.
How do you choose what to prioritize?
Well, it really just depends on what’s going on at any given time. With a lot of the regulatory and government side of things there are deadlines which make it pretty easy to tell when they absolutely must be done.
On the customer side of things though it gets a little trickier. I don’t get involved with most of the deals that we do, but whenever we deal with our big enterprise customers there’s a lot more back and forth in hammering out the details of the contract. Things also get exponentially harder whenever you are dealing with an international agreement due to the unique challenges that each market provides. Our customers from big companies really keep us on our toes because they are always happy to tell us how we can improve and what they’d like to see. This also has a sort of trickle down effect on our smaller customers because things like stronger security benefit everybody.
Given that your job includes so many moving parts, how do you cover your bases?
It’s tough, there isn’t any way to cover everything internally and in many situations there is a lot of nuance involved that just can’t be handled by one person, so you’re going to need good outside help.
What advice do you have for startups in general about how to approach getting legal help?
The best advice I can give is fairly straightforward when it comes to finding good legal help: use your network. If you’re lucky enough to be in a place like San Francisco or Silicon Valley, you’ll hopefully know a few people who have gone through the process in the past. Attorney referrals are very helpful and often it’s a matter of capacity and budget whether to handle a matter in-house or to seek the help of outside counsel.