Standardisation of legal documentation is always a tricky issue, but things are definitely moving that way. Given my support for Professor Richard Susskind's contentions on changes that will take place in the provision of legal services, I am starting to come across subtle changes to the legal landscape.
Richard Susskind's focus, as expressed recently in The Times is "on the extent to which some, much or all of what lawyers do can be undertaken more quickly, more conveniently and less expensively, and in a less forbidding way, by systems than by conventional work."
To that end, I noticed that Paul Graham, a US software developer who is both a prolific writer and a partner in Y Combinator talked about how Y Combinator was working standardise legal documents for start ups, when he spoke at the Future of Web Apps in London in the latter part of 2007.
In his essay, derived from the speech he gave, he talks about the importance of standardisation generally, and how Y Combinator has commissioned generic legal documentation:
One of the most important things we've been working on standardizing are investment terms. Till now investment terms have been individually negotiated. This is a problem for founders, because it makes raising money take longer and cost more in legal fees. So as well as using the same paperwork for every deal we do, we've commissioned generic angel paperwork that all the startups we fund can use for future rounds.
Some investors will still want to cook up their own deal terms. Series A rounds, where you raise a million dollars or more, will be custom deals for the forseeable future. But I think angel rounds will start to be done mostly with standardized agreements. An angel who wants to insert a bunch of complicated terms into the agreement is probably not one you want anyway.
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