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Comment by ucdaz | Hacker News Reader

Thanks Paul. Oh and I know you like to eat cheese. Anyways, so should I be picky about which firm to go with? Does anyone have any good law firm recommendations in the Silicon Valley?

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http://www.paulgraham.com/angelinvesting.html#f2n

Any cons with large firms like Wilson Sonsini, meaning would they charge an arm and a leg once a startup gets funded?

Large firms have done a lot of business with a lot of companies. When we needed some urgent advice, our big firm couldn't give advice specific to the situation before a conflict waiver, which delayed things significantly.

We don't use them anymore, and I don't think there is much value added to justify the added cost of a large firm.

Do go with vanilla docs though.

The top firms are expensive, but worth it. It's usually not worth trying to economize on lawyers unless you really know what you're doing. Once a startup is established, it can make sense to try cut down one's legal bills by e.g. hiring an in-house counsel, but when you're inexperienced you don't want to be cutting corners in the legal dept. Better to overpay your lawyers than end up with some disastrous term in your funding agreement.

Isn't there a conflict of interest if a firm is introducing you to their investor network but then helping to craft the agreements? Or is this degree of cross-fertilization common and even necessary?

Still, if there's that prior relationship between the firm and some investors, how can we be sure our interests are being best represented?

If they're representing you, they're legally required to act in your interest, and they take that pretty seriously. I can't think of a case among all the startups we've funded where the startup felt their lawyers were selling out to the investors. There have been all sorts of disputes with lawyers (excessive bills, slowness, incompetence), but never that.

Technically, they are representing the company, not you personally. It is an important difference that doesn't really come up often AFAIK

You should be picky. I've had an instance where a lawyer ruined the prospects of getting a startup funded by acting in a very inappropriate fashion while "helping out" during fund seeking.

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