Choosing the Right Lawyer

In partnership with

SDS 062: Choosing the Right Lawyer

Hey! thank you for reading issue 062 of Startup Definition Sunday (SDS). You can read past issues here.

SDS is the only newsletter that is redefining support for Africa's emerging founders. Every other Sunday, we cut through the fundraising and ecosystem noise to bring actionable insights to 2K+ emerging founders.

Thanks to the folks at Republic for sponsoring today’s issue.

Love the newsletter?

This newsletter is made possible by sponsors like the advertiser below. Your support helps us keep it free for all our readers. Take a moment to click their ad before diving into the rest of the newsletter—thank you!*

Looking for Stability in a Volatile Market?

Private infrastructure has outperformed public market equivalents by 86% on a 10-year annualized basis*—it’s no wonder why wealthy investors choose private markets.

With its highly selective, data-driven investment approach, Hamilton Lane’s Private Infrastructure Fund offers real ownership in the assets that are powering our future:

• artificial intelligence

• clean energy

• logistics + trade

Hamilton Lane provides access to deals from the very best private markets funds in the world, and Class R of this offering has delivered 31.67% annualized performance since inception.*

Add these elite institutional-grade investments to your portfolio today for as little as $500. Learn more about Hamilton Lane Private Infrastructure Fund here.

Don't Miss Your Chance to Invest

_{*Source: Hamilton Lane data, Bloomberg as of January 2024. Past performance is not a guarantee of future returns.
All securities come with specific risks not limited to a total loss of your investment. Past performance is not indicative of future results. Please review the risks specific to this investment on the HLPIF deal page hosted on Republic.com/hlpif}

If you’d like to sponsor future issues of SDS, here’s a simple way to do it.

1 Week to Jasiel & Friends: Your Exclusive Access to Africa’s Future Trailblazers

I’m excited to be working on my new paid newsletter, Jasiel & Friends (J&F), launching in just 1 week!

If you’ve ever wondered what the next generation of African changemakers is thinking, building, and dreaming about – this is for you.

For just $1/month, you’ll unlock:

• Bi-weekly deep dives into candid conversations with my closest friends and peers who are shaping Africa’s future – from entrepreneurs to innovators you haven’t heard of yet but need to know.

• AI-enhanced storytelling: I use cutting-edge AI tools to transform real Zoom call conversations into polished, narrative-driven newsletters – making it easy for you to access the most valuable insights of the next generation of African changemakers.

Why J&F?
This newsletter captures the real voices and inspiring perspectives of Africa’s future trailblazers – with technology helping to amplify and deliver their stories straight to you.

👉 Reserve your spot today for less than the cost of your favorite coffee: Subscribe Now

Let’s explore the future of Africa, together.

It’s a rainy day in Nairobi, this mother’s day.

In our last issue, we talked about what to expect after signing a term sheet for a priced round. One key takeaway was the importance of appointing the right legal counsel to navigate the complexities of venture transactions.

But how do you choose the right lawyer as an African startup founder? Here are 3 critical factors to consider when hiring legal counsel for your transactions..

1. Expertise in Both Local and Delaware VC Transactions

African startups often have a dual structure: a local operating company and a Delaware-incorporated holding company (holdco). Your lawyer must have experience with venture capital transactions, not just locally but also in Delaware.

Why is this important? Poor experience in these areas can lead to costly delays and missed details, especially when dealing with SAFE conversions, cap table management, or Delaware law nuances. A lawyer who has worked on similar deals will anticipate potential pitfalls and proactively address them.

Pro Tip: Ask for specific examples of the VC transactions they’ve handled in your market and in Delaware. If they don’t have a track record in both, keep looking.

2. A Business-Minded Approach

Your lawyer shouldn’t just be a legal expert. They should also understand the startup ecosystem and your business goals. Look for someone who can balance protecting your interests with keeping the deal moving forward.

Some lawyers approach transactions with an overly adversarial mindset, which can create friction with investors and prolong negotiations. A lawyer with a business-minded approach will focus on finding win-win solutions while ensuring you’re protected.

Pro Tip: During your initial consultation, observe how they approach problem-solving. Do they suggest practical solutions, or do they get stuck on minor details? Their mindset in this conversation will likely reflect how they’ll handle your deal.

3. Transparent Pricing and Startup-Friendly Fees

Legal costs can add up quickly in a venture transaction, so clarity on fees is essential. Many experienced lawyers offer startup-friendly packages or deferred payment plans that align with your fundraising timeline.

Ask for a detailed breakdown of their fees and billing structure upfront. Are they charging an hourly rate, a flat fee, or a combination of both? Will they cap their fees for certain parts of the transaction? Transparency here will help you avoid unpleasant surprises later.

Pro Tip: If a lawyer offers deferred fees, confirm any conditions tied to the deferment. For example, will the fees become payable if your round doesn’t close?

My Two Pesewas

The right lawyer can make or break your transaction. They’ll save you time, money, and stress while ensuring your interests are protected. On the flip side, a poor choice could lead to unnecessary delays, legal complications, or unfavorable terms. By focusing on these three factors, you’ll be well on your way to assembling a team that supports your success.

If this resonated with you, share this newsletter with another founder navigating their fundraising journey.

That's all for today. As always, thank you for being an engaged reader. Let me know your thoughts on this issue. I’d love to hear your experiences or tips on navigating tough decisions in leadership.

Until next time,

Jasiel

Find me on X, LinkedIn or Book a 1:1 Call

Whenever you are ready, there are 3 ways I can help you:

1. Review your deck for investment: It takes less than 5 minutes to complete.

2. Improve your investor updates using these two templates.

3. Promote your brand to 1000+ early-stage and aspiring founders by sponsoring this newsletter.

^{*Ads are paid placements and not endorsements; we are not responsible for any actions or outcomes resulting from clicking or engaging with them.}