Starting my first business…
When I finished college, I didn’t know anything about business and came from a family of non-business people, but fortunately for me, a college professor inspired me to start my first venture in 2012.
I think it’s easy to underestimate the vastness of the unknowns when starting a business for the first time. I knew nothing.
Family friends of mine told me that if I structured my business incorrectly it could kill my business in the future.
So I fell into the age-old trap that most young founders fall into. I hired an expensive brand name law firm.
I did this for two reasons:
- I thought if I paid extra today, it would avoid issues in the future (this later was proven wrong)
- They offered to defer up to $15,000 of fees until we raised capital (this was the trap)
In the first 3 months, the law firm sent me a bill showing that we had surpassed our $15,000 in deferral and now owed them $15,000.
This BIG bill scared me. I thought I was going to have to close my business if I continued any further.
So I Googled around and found a lawyer for a fraction of the cost on UpCounsel who had 100+ 5 star reviews. Helen became part-time General Counsel of my company and saved me $80,000+ in fees over the years.
The Shutdown Announcement
In February, I received an email from UpCounsel announcing their imminent shutdown.
I was shocked.
I knew tons of my friends had hired lawyers from UpCounsel, so I assumed they had a good revenue stream. So why were they now planning to down?
Cracks in the Armor
Through the first 8 years of the business, UpCounsel had raised $20 Million in Venture Capital funding from prominent investors. They had built a fantastic reputation, software, and community of high-quality lawyers.
By late 2017 growth had slowed a bit, and they were locked in a prolonged lawsuit with shareholders. These two combining factors made fundraising challenging for the company which led to a series of layoffs in 2018, and ultimately the founders and remaining employees joined Linkedin.
When we saw the announcement, Xavier decided to reach-out to the founders.
We quickly learned that we had an opportunity to continue holding and growing this business while helping the founders get a favorable outcome.
The founders Matt and Mason had poured their hearts into the business for 8-years, and we wanted to help make sure their company lived on, while helping them earn a healthy payout in the process (read The Founder Code soon).
Things moved quickly from there — we were able to structure a deal with investors and founders for a positive outcome to what otherwise would have been a sad ending to a great business — 1 month later we are the proud owners of UpCounsel.com, which is used by over 1 Million customers a month for legal help.
If you need affordable, high quality legal help for your business give it a try.
If you’re the founder of one of the following, give us a call:
- A business that makes over $1 Million in Cashflow per year and is stable or growing
- A business that has over $10M+ in revenue but is burning too much cash
We always seek to buy the majority of a company, but we are open flexible arrangements. In our ideal situation, we buy a profitable business with a great team and help the owner get a financial windfall for their life’s work.