4 ms·

The best part about this - Paul calls out the lawyers you should use. Thank you, thank you, thank you a thousand times for this. (We got standard corporate at

The best part about this - Paul calls out the lawyers you should use. Thank you, thank you, thank you a thousand times for this. (We got standard corporate attorneys - I've spent almost $60,000 on legal expenses between incorporation, option plan, and IP protection. Probably could have done it all for under $20K with the right attorney from the get-go.) I would love to see a sample convertible debt document in addition to the Series AA documents.

tptacek 18y ago
$60k on incorporation, option plan, and IP? You know more about this stuff than I do, but that sounds crazy high. Is the breakdown like, 10%/80%/10%? The one of these that I can see spending money on is the option plan.
- sachinag 18y ago
  10/10/40. I got bad advice. Everything's overbuilt because our guy, even though he's a member of the IVCA, didn't have standard docs.
  - tptacek 18y ago
    If $24k for IP is bad advice, what do you think the right number would have been?
    - sachinag 18y ago
      Yokum (one of the absolute best out there) quotes $5K as a barebones starter package. I'm sure he'd have helped us avoid overbuilding on the IP in addition to the overbuilding on the corporate stuff. http://www.startupcompanylawyer.com/faqs/ http://www.startupcompanylawyer.com/faqs/ I refuse to believe you could get half as good as Yokum for twice the price.
      - tptacek 18y ago
        He wouldn't remember it, but Yokum spent a good chunk of time on the phone with me and my cofounders when we started Matasano, as a favor for a mutual friend. I totally agree with you. Having said that, I guess I was weaseling my way around to the point that a boilerplate IP agreement would cost next to nothing, and would probably be all you'd ever need. People obsess too much about IP, and not enough about their own execution risk.
        sachinag 18y ago
        (I know it's uncool to say here, but we're applying for a patent on our transaction engine. Even in the patent process, we probably could have saved some cash.)
        tptacek 18y ago
        Uncool isn't the word I'd use. I've got patent applications from 7+ years ago, with reputable IP lawyers working for going concerns, that are still "pending". My snipe at you might be "pointlessness". ;)
        tptacek 18y ago
        (but I can see why you spent so much money on IP now; patents are expensive).
        sachinag 18y ago
        Chicago investors kept telling me they would only invest in a company with "protectable IP." Coming from a healthcare VC background, I didn't question it. That was a mistake. It is what it is at this point - so much money sunk into it that I want to finish it off.
        tptacek 18y ago
        The alternative approach to this is trade secrets law --- we've advised trading firms (for instance) that go through some formality to demonstrate controls on trade secret information for exactly this reason. But you'd probably have been screwed on lawyers either way. Best of luck with the project.
    - colins_pride 18y ago
      He's saying 10k for inc., 10k for options, 40k for IP Just to try & help clarify

tptacek 18y ago

$60k on incorporation, option plan, and IP? You know more about this stuff than I do, but that sounds crazy high. Is the breakdown like, 10%/80%/10%? The one of these that I can see spending money on is the option plan.

sachinag 18y ago
10/10/40. I got bad advice. Everything's overbuilt because our guy, even though he's a member of the IVCA, didn't have standard docs.
- tptacek 18y ago
  If $24k for IP is bad advice, what do you think the right number would have been?
  - sachinag 18y ago
    Yokum (one of the absolute best out there) quotes $5K as a barebones starter package. I'm sure he'd have helped us avoid overbuilding on the IP in addition to the overbuilding on the corporate stuff. http://www.startupcompanylawyer.com/faqs/ http://www.startupcompanylawyer.com/faqs/ I refuse to believe you could get half as good as Yokum for twice the price.
    - tptacek 18y ago
      He wouldn't remember it, but Yokum spent a good chunk of time on the phone with me and my cofounders when we started Matasano, as a favor for a mutual friend. I totally agree with you. Having said that, I guess I was weaseling my way around to the point that a boilerplate IP agreement would cost next to nothing, and would probably be all you'd ever need. People obsess too much about IP, and not enough about their own execution risk.
      - sachinag 18y ago
        (I know it's uncool to say here, but we're applying for a patent on our transaction engine. Even in the patent process, we probably could have saved some cash.)
        tptacek 18y ago
        Uncool isn't the word I'd use. I've got patent applications from 7+ years ago, with reputable IP lawyers working for going concerns, that are still "pending". My snipe at you might be "pointlessness". ;)
        tptacek 18y ago
        (but I can see why you spent so much money on IP now; patents are expensive).
        sachinag 18y ago
        Chicago investors kept telling me they would only invest in a company with "protectable IP." Coming from a healthcare VC background, I didn't question it. That was a mistake. It is what it is at this point - so much money sunk into it that I want to finish it off.
        tptacek 18y ago
        The alternative approach to this is trade secrets law --- we've advised trading firms (for instance) that go through some formality to demonstrate controls on trade secret information for exactly this reason. But you'd probably have been screwed on lawyers either way. Best of luck with the project.
  - colins_pride 18y ago
    He's saying 10k for inc., 10k for options, 40k for IP Just to try & help clarify