A Lawyer and an Accountant
The two pros every company needs to hire
Starting Lickability 10 years ago was relatively simple on paper. As 19-year-olds, Brian and I hopped on LegalZoom, filled out some form fields, and presto—our company was born. If you’re thinking of starting a company today, tools like Stripe Atlas make it even easier. But at a certain point of seriousness and profitability, you can’t get away with outsourcing all of your corporate administration to a robot.
Once your company is off the ground, there comes a point when you need to hire professionals to help manage the bureaucratic mazes of contracts and taxes. Today, I’m going to tell you about the two most important professionals to hire, how to do it, and the folks we recommend working with in case you need a referral. 😉
Hire a Lawyer
Software is complex. As developers, it’s our job to wrangle that complexity and present something easily understandable to our customers so they can get their job done. A good lawyer will do that for you with a similarly byzantine system: the law. As Emily Croy Barker pointed out in her New York Times opinion piece in 2013, it’s not absurd to think of lawyers like wizards. She writes, “In the end, magic is another form of power, and lawyers understand power. That’s what they do. The law regulates the powers of different parties — of the state, of private individuals and of corporate bodies — and a lawyer’s task is to find ways to enhance, exploit or rein in those powers.”
Before Lickability had a lawyer, we were piecing our contracts together from Google searches, boilerplate template libraries, and favors from friends who were smart enough to have already hired a lawyer. That all changed when we watched this now-famous Creative Mornings talk by Mike Monteiro, one of the founders of Mule Design in San Francisco. In the talk, Mike appears with his lawyer (and friend) to answer questions from the crowd about how to get paid for their creative work. Mike says that he loves his lawyer because he saves them money. This was a lightbulb moment for us years ago. We always thought of lawyers as a costly expense, rather than an investment in the company’s bottom line.
If you have a great lawyer that understands software, I’d love a recommendation. Mentions and DMs work. Thanks!— Matthew Bischoff (@mb) July 31, 2015
After that, we asked Twitter for recommendations, had a few initial conversations, and eventually hired Greg and his firm Mavronicolas Law Group via our pal Kyle Bragger. Over the last five years, Greg and his team have helped us negotiate dozens of contracts, filed our trademarks, and kept an eye out for our interests in many ways throughout the years. We all sleep better and do better because of their partnership. As soon as your company starts facing even minor contractual or legal questions, invest in a great lawyer. It’ll pay off in spades.
Hire an Accountant
With the contractual out of the way, let’s discuss the financial. As your company starts to make some cash, you’ll need to maintain your books, file, and pay your taxes. If you’re like Lickability, with founders living in multiple states and clients all over the US, this can get complicated really fast.
We went through a number of accountants before settling on the one that makes the most sense for us. Andrew Carroll (aka CFO Andrew) was recommended to us by friend of the company, Sam Soffes. What’s different about Andrew’s model is that he isn’t just there for you at tax time; he partners with freelancers and companies year-round.
Andrew has taught us a lot over the years: the difference between accrual and cash based accounting, passthrough income vs. C corporations, and how much cash we should keep in the bank to run the business. And because he’s also a financial advisor, we can ping him in his Slack with random personal or corporate finance questions whenever they strike throughout the year.
If your company is already making a profit, it’s time to hire an accountant. You’ll be glad you did when they help save you money with tax credits, deductions, and avoiding fees by filing correctly and on time.
Bonus: Hire an Ops Person
If you’re at the size where you’ve already got a lawyer and accountant you love, consider all the administrative and operational stuff you deal with every week that makes it harder for you to run the company. If it’s enough work that it’s bugging you, it might be worth talking to someone who’s really good at dealing with operational and administrative tasks. Before we hired our own Operations Associate, we worked part-time with the wonderful and hyper-organized Kathy Campbell. Give her a ring, and she’ll sort out all your admin.
Your job as a founder or CEO is to run your company and make your customers happy, not to do every little thing by yourself. Work with the pros who will save you time and make you money. Hire a lawyer, hire an accountant, and (if you’ve got room in the budget) get some help with your operations. Trust me, you’ll be glad you did.