Most weekends I buy the FT newspaper for all sorts of reasons. One of them is a general interest in the Business Entrepreneurial section. Going back through a few old copies, before I chucked them into the recyling I came across a very helpful question and answer in the Business Questions section.
I could link to it, but the FT requires registration (free) and I thought it might be easiest if I simply reproduced it here. (It's September 10/11 2011). It addresses the painful and often expensive issue of how best to get basic corporate documentation sorted out for a start-up business.
"I'm the managing director of a start-up manufacturing business. We're in the process of preparing a shareholder agreement, supplier contracts and employment contracts for our staff and are worried about the costs involved in hiring a law firm. I've come across a numer of online legal documents that purport to fulfil our needs but I am unsure of their quality and whether they carry the same weight as bespoke documents."
The response is from Grahame Cohen, chief product and technology officer of Epoq which provides technology solutions to the legal sector.
"There are an awful lot of confusing options out there, so I'll identify them, highlight their differences and then suggest a best fit for you. I suspect what you have come across so far are the various services scattered throughout the web that allow you to download pre-written templates, commonly in Microsoft Word.
These are often very low cost but come with a significant downside, as you have to essentially act as your own lawyer and try to edit them to ensure they suit your purposes. These services generally exclude all liability, so you're not covered if something goes wrong. This is a risky option which you should avoid unless you simply can't afford anything else.
There are more advanced services that use online questionaires to interview you in a similar fashion to a solicitor. Using your answers, they create comprehensive documentation based on your circumstances. These are often a little more expensive but a far better option as the documentation quality is likely to be on a par with bespoke drafting. As you are looking to draft agreements vital to your company I suggest that a solicitor reviews them to ensure you don't fall foul of any compliance regulations. Ideally, what you want is a blended service - which certain forward thinking law firms now offer - combining online questionnaires with their trusted advice, so you get the best of both worlds at a more affordable fixed fee. A useful resource to find these firms is www. OnlineSolicitorsDirectory.co.uk."
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