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Raising Money
Episode 512th January 2024 • In The Bunker • Joshua Maddux
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Summary:

In this engaging episode of "In The Bunker," we welcome Matthew Lopez, a fractional startup General Counsel. Matthew brings unique insights into helping early-stage startups navigate legal complexities, with a focus on avoiding legal pitfalls, fundraising, and scaling. He shares his experience in offering diverse payment structures for his services and his approach to working with investors and startups from a legal and financial standpoint.

Our episode highlights:

  • Matthew's innovative approach to providing general counsel services fractionally.
  • Challenges faced in raising funds and scaling startups, with specific legal perspectives.
  • Practical advice for startups on finding advisors and asking for help.
  • Matthew's unique methodology in helping startups set up legal structures and make informed decisions.

Bio:

Matthew Lopez specializes in assisting early-stage startups as a fractional General Counsel. He adopts a venture capital approach to his practice, understanding the constraints startups face in affording quality legal assistance. With a background in both law and accounting, Matthew has a comprehensive understanding of the legal and financial challenges startups encounter. He offers various payment options, including equity and monetary compensation, aligning his services with the needs of startups.

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Transcripts

Joshua Maddux:

Welcome back to in the bunker.

Joshua Maddux:

Every business owner has faced challenges and we love to share those stories.

Joshua Maddux:

Today.

Joshua Maddux:

We have Matthew Lopez in the bunker with us.

Joshua Maddux:

Matthew helps early stage startups avoid legal issues by providing them general

Joshua Maddux:

counsel, but he does it fractionally.

Joshua Maddux:

And he's going to explain a little bit that in a minute, there's so

Joshua Maddux:

much to learn from this conversation.

Joshua Maddux:

I'm super excited to jump in, welcome to the show.

Matthew Lopez:

And it's great to be here, looking forward to having this

Joshua Maddux:

conversation.

Joshua Maddux:

Awesome.

Joshua Maddux:

Let's get to know you a little bit.

Joshua Maddux:

Let's get that 92nd background.

Joshua Maddux:

Who are you?

Joshua Maddux:

How'd you get here?

Joshua Maddux:

What do you do?

Joshua Maddux:

Technical issues.

Joshua Maddux:

I love it.

Matthew Lopez:

Sorry about that.

Matthew Lopez:

Every time someone calls me, it cuts off my your headset, and it's

Matthew Lopez:

the most annoying thing it's yeah.

Joshua Maddux:

I love it.

Matthew Lopez:

My name is Matthew Lopez.

Matthew Lopez:

I'm a fractional general counsel.

Matthew Lopez:

And what that kind of it looks like is I work with lots of different

Matthew Lopez:

startups as their general counsel and I work part-time for them, but it's

Matthew Lopez:

being able to be this in-house role with being this outside position.

Matthew Lopez:

So what I do is I have a lot of.

Matthew Lopez:

And we have different attorneys at different levels paralegals.

Matthew Lopez:

And so what we do is we create a fractional legal department for

Matthew Lopez:

businesses at all different sizes.

Matthew Lopez:

So depending if you're a startup to a midsize company or whatever, we plug in

Matthew Lopez:

the resources that you need, and then you get to use it as much or as little.

Matthew Lopez:

As you really need.

Matthew Lopez:

And so as the general counsel, I go in there, I organize it all.

Matthew Lopez:

And I make sure that you have one point of contact to be able

Matthew Lopez:

to utilize all these services.

Matthew Lopez:

And then for other companies that may already have a general counsel, we

Matthew Lopez:

actually just plug in the legal department and then they have the ability to

Matthew Lopez:

use as much or as little as they want without without having a GC in place.

Joshua Maddux:

Got it.

Joshua Maddux:

So the nice part about the fractional aspect and for those who are

Joshua Maddux:

listening like this, isn't just for an attorney who is general

Joshua Maddux:

counsel with inside the business.

Joshua Maddux:

This is also for maybe it's a CMO or a CFO, or, all those different

Joshua Maddux:

types of roles where you want to flush out a a more leadership.

Joshua Maddux:

Docket, but you don't necessarily have the financial ability to go out

Joshua Maddux:

and just hire eight different C-level executives at their full salary.

Joshua Maddux:

This allows you to not only hire someone at a considerably less rate than a full

Joshua Maddux:

salary for a general counsel, but it also gives the aspect of you're not just

Joshua Maddux:

hiring, they're not just hiring just you.

Joshua Maddux:

Part-time they're hiring you and your full team part-time, which

Matthew Lopez:

is pretty cool.

Matthew Lopez:

Yeah.

Matthew Lopez:

It's pretty nice because a lot of the times most businesses

Matthew Lopez:

don't need a full-time GC.

Matthew Lopez:

They don't have enough work to demand that because the reality is

Matthew Lopez:

the GC is a very high level person.

Matthew Lopez:

They should only be reviewing a certain amount of stuff.

Matthew Lopez:

It's more about strategy.

Matthew Lopez:

Whereas paralegals, senior attorneys and associates.

Matthew Lopez:

I can handle a lot of the grunt work at a lower price point for the

Matthew Lopez:

business, but hiring all of these different people to create a law

Matthew Lopez:

firm or to create a legal department in a business just doesn't work.

Matthew Lopez:

And it's the same thing for CFOs and CMOs.

Matthew Lopez:

A lot of the people that I work with have these exact same kind of structures where

Matthew Lopez:

you can plug and play a whole department.

Matthew Lopez:

And you only utilize what you want.

Matthew Lopez:

And so it's a much better model to be able to get that high-level experience

Matthew Lopez:

that you just wouldn't be able to afford if you went out onto the market.

Joshua Maddux:

Yeah.

Joshua Maddux:

Yeah.

Joshua Maddux:

Which is really cool.

Joshua Maddux:

And then allows the business to grow over time.

Joshua Maddux:

And like you said, maybe.

Joshua Maddux:

Down the road as that company does grow, they do hire, maybe a general counsel

Joshua Maddux:

or someone internal, which is fine.

Joshua Maddux:

And then after that, company has hired the general counsel.

Joshua Maddux:

Then you guys are still there to support, to be back office,

Joshua Maddux:

to do some more of that stuff.

Joshua Maddux:

As that company continues to grow, to flush out, potentially having a

Joshua Maddux:

full legal department, if they're able to pay for that as needed.

Matthew Lopez:

And the love of the times we encouraged, like a lot of the

Matthew Lopez:

times these companies want to hire the actual one of the people that's working

Matthew Lopez:

on their cake, like on their business.

Matthew Lopez:

So they usually will find that they'll take the senior associate

Matthew Lopez:

and that's their first legal.

Matthew Lopez:

So because they know the business, they know everything about it, and

Matthew Lopez:

they're comfortable with that person or they're like, and so it's a really nice

Matthew Lopez:

transition for them and we encourage it.

Matthew Lopez:

It's one of those things where we help find talent for our clients.

Matthew Lopez:

And we're constantly hiring people to replace those people, train them and get

Matthew Lopez:

them into the, because it's about, we're encouraging our people to grow internally

Matthew Lopez:

and then go find the right opportunity.

Joshua Maddux:

That's really interesting, super backwards from

Joshua Maddux:

a typical contractor agreement.

Joshua Maddux:

Normally there's a, you can't hire anybody on our team for, 12 months

Joshua Maddux:

after our agreement ends or something like that, where you guys are literally

Joshua Maddux:

doing the opposite where you're like, Hey, as you guys grow, we encourage

Joshua Maddux:

you to take the employee that's on our team and hire them internal.

Joshua Maddux:

as You guys grow and obviously there's some placement fees

Joshua Maddux:

and stuff associated, but yeah.

Matthew Lopez:

Exactly.

Matthew Lopez:

And that's one of those things is like, it's one of those things.

Matthew Lopez:

Like we helped find these people for you.

Matthew Lopez:

We help develop them.

Matthew Lopez:

So there's an, it cost for extracting them from our team.

Matthew Lopez:

But it also, then that cost goes into us being able to replace that

Matthew Lopez:

person and being able to train the next generation of attorney for it

Matthew Lopez:

because it's one of those things.

Matthew Lopez:

A lot of our companies really.

Matthew Lopez:

That we're very business-minded.

Matthew Lopez:

We are not a, we're not like a lot of lawyers that are, in-house getting

Matthew Lopez:

a bad reputation of being the know.

Matthew Lopez:

And we very much don't say, no, we say, here's your what is it that

Matthew Lopez:

you're actually trying to solve for?

Matthew Lopez:

Okay.

Matthew Lopez:

The way that you're going about that, isn't the appropriate way.

Matthew Lopez:

Most likely here's a couple other options.

Matthew Lopez:

Pros and cons of each one of these, you get to pick what

Matthew Lopez:

you want, which one you want.

Matthew Lopez:

And if you want to sink your company, by all means, go for it.

Matthew Lopez:

It's not my problem.

Matthew Lopez:

bUt it's one of those things where we have a very different approach

Matthew Lopez:

to being your partner and being a business, like being a part of their

Matthew Lopez:

business, rather than being this outside service that you're utilizing.

Matthew Lopez:

We want to.

Matthew Lopez:

In house as much as we can without you having to pay the cost of employee.

Matthew Lopez:

And that's that's why a lot of companies really like our model and we are

Matthew Lopez:

swamped with new clients every month,

Joshua Maddux:

not a bad problem to have.

Joshua Maddux:

I will say.

Joshua Maddux:

So many times, like we deal with attorneys like clients, attorneys,

Joshua Maddux:

as we're sending a contract to sign.

Joshua Maddux:

And the client's attorney wants us to put a stipulation that, as a digital agency,

Joshua Maddux:

the website's going to be online 24, 7, 365, a hundred percent guaranteed up time.

Joshua Maddux:

And I was like, have you ever used the internet before?

Joshua Maddux:

Yeah.

Joshua Maddux:

And just that hap aspect, I feel like sometimes there's attorneys

Joshua Maddux:

that are out there, that they have so much of a CYA policy that there's

Joshua Maddux:

no way you could get business done.

Joshua Maddux:

And there's no way where what you guys are explaining is the aspect of you still

Joshua Maddux:

got to give business time, but what's the, how can we make sure we're not going

Joshua Maddux:

to get in trouble instantly prophet.

Matthew Lopez:

Exactly like that's at the end of the day, it's okay, this

Matthew Lopez:

deal is going to get done one way or the other, how can I best protect my client?

Matthew Lopez:

How can I make the pie bigger for everyone?

Matthew Lopez:

Because a lot of the times, most attorneys they'll send red lines

Matthew Lopez:

back and forth and nothing gets done.

Matthew Lopez:

It takes weeks to get contracts done.

Matthew Lopez:

My policy is that I send out a contract for one of my clients,

Matthew Lopez:

or I receive a contract I red line and I'm like, Hey, let's jump on a

Matthew Lopez:

phone call to discuss because now we have now we have an understanding.

Matthew Lopez:

What we need to discuss and how we can resolve, let's get on the phone so we

Matthew Lopez:

can resolve these issues and find some way for our two companies to do business

Matthew Lopez:

because they want to do business.

Matthew Lopez:

My job is not to stop them from doing business it's to help them.

Matthew Lopez:

And it's yeah, a lot of people, a lot of attorneys don't see it that way.

Matthew Lopez:

Yeah,

Joshua Maddux:

frustrating.

Matthew Lopez:

Very it is.

Matthew Lopez:

And that's especially when I come into a new business, like right

Matthew Lopez:

now, I'm actually having this problem with one of my clients.

Matthew Lopez:

I redline line these agreements and I don't get, they're not including me on

Matthew Lopez:

the emails before I get the red line.

Matthew Lopez:

So I have no contacts.

Matthew Lopez:

Then they take my red line and they send it out without, including me.

Matthew Lopez:

So I have no ability, like I'm just sitting there in the ether

Matthew Lopez:

and eventually I was like, no, this is not going to happen.

Matthew Lopez:

And after it happened like twice.

Matthew Lopez:

I am not going to gum up your thing.

Matthew Lopez:

I actually saw make these problems go away much quicker if there is issue, because

Matthew Lopez:

I know how to handle this properly.

Matthew Lopez:

And so right now we're having that meeting to and like over

Matthew Lopez:

email, he's yeah, you're right.

Matthew Lopez:

We probably, we need to do this.

Matthew Lopez:

Let's get on a phone call and discuss how we want to implement this.

Matthew Lopez:

A lot of, there's a lot of hesitancy to include attorneys in negotiations a lot

Matthew Lopez:

of the time, because we muck shit up and it's no you shouldn't be mucking it up.

Matthew Lopez:

You should be helping clarify and be able to protect the client.

Matthew Lopez:

And the, sometimes it's about having a mutuality of closets and having really

Matthew Lopez:

fair agreements that go both legs.

Matthew Lopez:

Yeah,

Joshua Maddux:

that's true.

Joshua Maddux:

anD that's where I feel like so many businesses.

Joshua Maddux:

And, or, just business owners in general, any time that they don't understand

Joshua Maddux:

something, it's I don't understand it.

Joshua Maddux:

I don't want to deal with it, and it's that aspect of, just not

Joshua Maddux:

wanting to touch it because it's something that's not understood.

Joshua Maddux:

And that's where I think oftentimes sadly, there's a lot of attorneys.

Joshua Maddux:

Don't make it easier to understand.

Joshua Maddux:

And I've seen websites where their terms and conditions is 12 pages

Joshua Maddux:

long, and you can't understand it.

Joshua Maddux:

Then I've seen other websites where it's a two column in the left column, has all

Joshua Maddux:

the legal speak at the right column as the English interpretation of, or whatever.

Joshua Maddux:

And it's oh, okay.

Joshua Maddux:

At least we're trying to make this accessible to the general public.

Joshua Maddux:

And that's good.

Joshua Maddux:

It's just, it's crazy.

Joshua Maddux:

As you're working with these businesses and chatting through, just these issues

Joshua Maddux:

and helping them, in that early stage of startup, what are some of those

Joshua Maddux:

challenges that you help them overcome?

Joshua Maddux:

So the issues that they are facing.

Matthew Lopez:

Yeah, there's a lot of different issues that startups deal with.

Matthew Lopez:

I think one of the biggest things is how do you set up the corporation, like the

Matthew Lopez:

business and what are the implications of kind of an LLC versus a corporation.

Matthew Lopez:

And that's a big decision that a lot of business owners need to understand,

Matthew Lopez:

and it's not just a legal decision.

Matthew Lopez:

It's also a tax decision.

Matthew Lopez:

And if you don't have.

Matthew Lopez:

If you don't have the right people talking, you can get

Matthew Lopez:

mixed messages from people.

Matthew Lopez:

And then it's like a business owner doesn't know how to interpret both

Matthew Lopez:

sides because both sides are speaking different languages and don't

Matthew Lopez:

know how to understand each other.

Matthew Lopez:

And so the real key is having someone that you can advise you on that understands

Matthew Lopez:

the whole gambit of stuff, not just legal, not just tax and business.

Matthew Lopez:

And you need to have that congruency because it's everything.

Matthew Lopez:

And so a lot of the times that's one of the big things that I help with is

Matthew Lopez:

because I have a masters in accounting.

Matthew Lopez:

I have RA I raised, I ran a startup and I raised money on that startup.

Matthew Lopez:

Like it's a very different beast to be able to then advise someone

Matthew Lopez:

on all of these and be able to listen to all the professionals.

Matthew Lopez:

So that's one of the major areas.

Matthew Lopez:

And then the other one is for founders is if there's more than one.

Matthew Lopez:

guEss what, something's going to go wrong between your relationship at

Matthew Lopez:

some point, and or someone going to want an exit or who knows what it is.

Matthew Lopez:

So you need to be able to, you need to prepare for those things, because

Matthew Lopez:

I had one startup where the founders had known each other for years.

Matthew Lopez:

They're their best friends.

Matthew Lopez:

One guy had a mental breakdown during the startup because he was working too much

Matthew Lopez:

and was sidelined for two or three months.

Matthew Lopez:

And because of their, the way they set it up before I got

Matthew Lopez:

in, they couldn't do anything.

Matthew Lopez:

The other founder literally couldn't sign anything so hired both of

Matthew Lopez:

their decisions because they were both 50, 50 pack partners.

Matthew Lopez:

Jeez.

Matthew Lopez:

So for three months, we were trying to figure out how to

Matthew Lopez:

deal with this situation.

Matthew Lopez:

And then after he got out of it, the guy was still a little loopy.

Matthew Lopez:

And so we had to exit him from the startup and separate the company.

Matthew Lopez:

And so if they had done good agreements at the beginning,

Matthew Lopez:

this would have solved this.

Matthew Lopez:

And it's one of those things where you don't ever think

Matthew Lopez:

of that's going to happen.

Matthew Lopez:

Oh, that's not going to be me and my co-founder known each other for 10 years.

Matthew Lopez:

We've been childhood friends.

Matthew Lopez:

When there's money involved and there's decisions and there's emotions, all of

Matthew Lopez:

these things come into play, stuff goes wrong and you have to be able to have that

Matthew Lopez:

understanding of who makes the decisions.

Matthew Lopez:

Who's the tiebreaker.

Matthew Lopez:

And in a decision or who is going to if it's a financial decision who makes it,

Matthew Lopez:

if it's a legal decision who makes the tie it, like you can break it all up.

Matthew Lopez:

There's lots of cool ways that you can do it.

Matthew Lopez:

Or maybe it's just flip a coin.

Matthew Lopez:

And I've seen that done before and it's random.

Matthew Lopez:

I'm like, okay, that's what you want.

Matthew Lopez:

Cool.

Matthew Lopez:

But you never know what how you want it.

Matthew Lopez:

You need to put.

Matthew Lopez:

Process in place

Joshua Maddux:

for it.

Joshua Maddux:

Yeah.

Joshua Maddux:

And that's the key to anything, really?

Joshua Maddux:

Any business decision, if there's a process or some sort of analysis that's

Joshua Maddux:

been done, if everybody agrees on the process and whatever the outcome is,

Joshua Maddux:

Resulting in the company filing for bankruptcy or closing or whatever the

Joshua Maddux:

process like if the process was agreed upon and everybody in the decision-making

Joshua Maddux:

aspect is like yeah, we followed the process and that's what we all said to do.

Joshua Maddux:

And yeah, everything went belly up.

Joshua Maddux:

So there's less of a.

Joshua Maddux:

For lack of a better explanation, but hurt feelings and emotions.

Joshua Maddux:

And there's a little bit less of that.

Joshua Maddux:

I've been a part of a startup weekend and man in three days, it's insane.

Joshua Maddux:

The amount of ideas they can come out and stuff that happens.

Joshua Maddux:

And, these are just conceptual elements that don't typically

Joshua Maddux:

end up going anywhere.

Joshua Maddux:

Now, granted, there are companies and products and apps and websites

Joshua Maddux:

that have all come out of a startup weekends that are incredible.

Joshua Maddux:

And, but 90, over 90% of the ideas that go into a startup weekend never go anywhere.

Joshua Maddux:

But still even concept ideas and seeing.

Joshua Maddux:

hUrt people get over, oh, this person changed my idea to do this instead.

Joshua Maddux:

And it's.

Matthew Lopez:

Yeah, most people want to think that they're extremely logical

Matthew Lopez:

when it, the reality is we're extremely emotional creatures and it's one of those

Matthew Lopez:

things where you have to take that in consideration when you're doing all of

Matthew Lopez:

these things and having the emotional intelligence to be able to put the

Matthew Lopez:

process in one of my favorite books is the five dysfunctions of a team.

Matthew Lopez:

And it lays out how you get buy-in from people.

Matthew Lopez:

And the team, and that's really what it comes down to when you're

Matthew Lopez:

making these decisions is you just need to be able to allow people to

Matthew Lopez:

express their minds and then make the decision, make sure that they're heard.

Joshua Maddux:

Yeah, for sure.

Joshua Maddux:

Yeah.

Joshua Maddux:

And that's, what's hard in a situation like you were mentioning

Joshua Maddux:

earlier where, the co-founder was on the sideline for a few months.

Joshua Maddux:

It's hard because even if decisions were made during that time, unless they're.

Joshua Maddux:

Process or an element in place that says what to do in that situation.

Joshua Maddux:

wHen that person does come back, it's hard because what, what decisions may have been

Joshua Maddux:

made may not have been those, the ones they wanted or, there's all those aspects.

Joshua Maddux:

But at the same point, if you're.

Joshua Maddux:

Starting a company that has employees and has investors

Joshua Maddux:

and has all that type of stuff.

Joshua Maddux:

Like you have to, you can't just park on the side of the road for three months.

Joshua Maddux:

Like you got to keep moving for you're going to burn through your cash.

Joshua Maddux:

You're going to, gonna end up having to shut it all down.

Joshua Maddux:

Yeah, it's crazy.

Matthew Lopez:

Cool.

Matthew Lopez:

No, and it's one of those things where, oh, go ahead.

Matthew Lopez:

No, I was just going to lead into maybe another topic.

Matthew Lopez:

Yeah.

Matthew Lopez:

Go for it.

Joshua Maddux:

Go for it.

Joshua Maddux:

That was going to transition as well.

Matthew Lopez:

I think one of the more important things that a lot of

Matthew Lopez:

founders are always asking questions from me is about fundraising.

Matthew Lopez:

And it's one of those, it's an extremely complicated area.

Matthew Lopez:

There's so many laws about it and.

Matthew Lopez:

There's certain ways that you do things and there's founder-friendly

Matthew Lopez:

ways and there's investor friendly ways to do stuff.

Matthew Lopez:

And I've seen like companies get forced into different buckets based on it.

Matthew Lopez:

And it's one of those things where if you don't have a clear plan of how

Matthew Lopez:

to raise money or know that process, your first time, you're going to

Matthew Lopez:

mess it up because it's not just business, it's legal, it's accounting.

Matthew Lopez:

It's everything that goes into that process.

Joshua Maddux:

So you mean to tell me there's laws about buying

Joshua Maddux:

people, giving companies $10 million and there's things you should do.

Joshua Maddux:

Imagine that

Matthew Lopez:

I know like the sec and the IRS might want to know about you

Matthew Lopez:

doing all of the, to handling all of this.

Matthew Lopez:

Yeah, just

Joshua Maddux:

maybe.

Joshua Maddux:

And if there's, the business, if the business makes money, they're

Joshua Maddux:

probably going to want that report.

Joshua Maddux:

And I guess as well nowadays

Matthew Lopez:

it's a crazy world.

Matthew Lopez:

The government's asking for all of these things.

Matthew Lopez:

I don't know.

Matthew Lopez:

Yeah,

Joshua Maddux:

no.

Joshua Maddux:

And I will say, I've been in business about 15 years now and.

Joshua Maddux:

Looking at some of the paperwork that has to be done now versus

Joshua Maddux:

even 10 years ago, it's insane.

Joshua Maddux:

Just the amount of more and more paperwork and more filings and more stuff and more

Joshua Maddux:

annual reports that have be submitted.

Joshua Maddux:

And it's crazy.

Joshua Maddux:

And I can't even imagine, when you get into the realm

Joshua Maddux:

of a startup, that's doing a.

Joshua Maddux:

a Campaign for 5 million, 10 million, $50 million, there's definitely some

Joshua Maddux:

legal aspects, some federal compliance and then the whole aspect of, okay, cool.

Joshua Maddux:

What happens if everything falls apart and the money goes away, like who's liable,

Joshua Maddux:

who's responsible for that, is it back on the co-founder now the co-founder.

Joshua Maddux:

Oh, those are the founders owed that investor $10 million.

Joshua Maddux:

That's going to be a lifetime to repay.

Matthew Lopez:

Yeah.

Matthew Lopez:

And generally no investor, thankfully is looking for that because they

Matthew Lopez:

know that these guys are broke.

Matthew Lopez:

That's why they're looking for money.

Matthew Lopez:

So it's thankfully we very rarely have that as an issue come up, but it's more

Matthew Lopez:

of putting together all the pieces.

Matthew Lopez:

To be able to find the right investors to get in front of them.

Matthew Lopez:

Because I was talking to a lot of my investor friends and one of the

Matthew Lopez:

firms that I work with, they did an analysis on who they've actually fund.

Matthew Lopez:

And the stat was about 85 to 90% of their deployed assets went to warm introduction.

Matthew Lopez:

So if you had just sent a cold pitch deck into their venture fund, guess what?

Matthew Lopez:

You have a 10 to 15% chance of getting funded, where as if someone that can make,

Matthew Lopez:

just to be like a nice little intro and be like, Hey, I know like this is a really

Matthew Lopez:

cool company astronomically, better on.

Joshua Maddux:

aNd I know I, the startup weekend, that was a part of, we had a.

Joshua Maddux:

A concept for an app that would allow you to basically invite five or six people

Joshua Maddux:

to an event, it would connect everybody's calendars through Cal or Google or

Joshua Maddux:

whatever, and then find available times then there's systems out there.

Joshua Maddux:

Now that do this we had this concept and idea 10 years ago.

Joshua Maddux:

Never did anything with it.

Joshua Maddux:

Never went anywhere at the time, trying to get.

Joshua Maddux:

Like iPhone calendar and Android calendar to work together was a

Matthew Lopez:

nightmare mess.

Joshua Maddux:

Yeah.

Joshua Maddux:

And so we actually sat down with a venture capital fund firm, and one of

Joshua Maddux:

their biggest things was, the developer who was playing with some concepts

Joshua Maddux:

with it He's we don't know if we're going to go with this platform or that

Joshua Maddux:

platform, the venture capitalist company, the guys were like, we don't care.

Joshua Maddux:

You're like give us concept because we don't care what it's built on.

Joshua Maddux:

If, if we invest a hundred million dollars into this.

Joshua Maddux:

yOu guys can rebuild it six months from now.

Joshua Maddux:

We just want to see it work.

Joshua Maddux:

We want to see things, we want to see the potential it has.

Joshua Maddux:

And so that's where, you get company people who walk into like shows

Joshua Maddux:

like shark tank and they're like, I've got this million dollar idea.

Joshua Maddux:

It's okay, cool.

Joshua Maddux:

What's the product.

Joshua Maddux:

It's you don't have a prototype.

Joshua Maddux:

You don't have anything.

Joshua Maddux:

Great.

Joshua Maddux:

You're not getting a dime

Matthew Lopez:

as.

Matthew Lopez:

As I say, I talk to people all the time that have million billion

Matthew Lopez:

dollar ideas and fantastic.

Matthew Lopez:

My big thing is, do you have the team that can execute this?

Matthew Lopez:

And most of the time it's no, it's just me.

Matthew Lopez:

I have this idea.

Matthew Lopez:

I'm trying to find people like Oh, come back to me when have

Matthew Lopez:

that team, because otherwise you have an idea it's worth 5 cents.

Matthew Lopez:

That's what anyone's going to pay you for it.

Joshua Maddux:

Yeah.

Joshua Maddux:

Yeah.

Joshua Maddux:

We get projects every now and then we're companies

Matthew Lopez:

an execute.

Joshua Maddux:

Yeah.

Joshua Maddux:

Yeah.

Joshua Maddux:

We get projects every now and then where companies are super concerned that we're

Joshua Maddux:

going to steal their idea and run with it.

Joshua Maddux:

And I was like, yeah, it's going to cost $100,000 to build that.

Joshua Maddux:

I'm not going to take my team off of paid work for the next, six to 12 months

Joshua Maddux:

to focus on building this project.

Joshua Maddux:

Then I'm going to have to dump another hundred thousand dollars into marketing

Joshua Maddux:

or more to maybe make my money by.

Joshua Maddux:

Three to five years down the road.

Joshua Maddux:

I'm like, eh, no, thank you.

Joshua Maddux:

I don't want it.

Joshua Maddux:

I don't want that.

Joshua Maddux:

Yeah.

Matthew Lopez:

As about to say I advise my startups, like you can

Matthew Lopez:

talk about the generics of your idea.

Matthew Lopez:

Like pretty much everyone, except someone that is a competitor.

Matthew Lopez:

Don't go tell your competitors what you're doing, but pretty much everyone

Matthew Lopez:

else is not going to steal your idea.

Matthew Lopez:

They have more important things to do, nor do they have the

Matthew Lopez:

expertise to execute on it.

Matthew Lopez:

So who cares?

Matthew Lopez:

Yeah.

Matthew Lopez:

Like the basic idea of your thing is not confidential.

Matthew Lopez:

It's not like I had these south companies always get me.

Matthew Lopez:

I'm like, okay.

Matthew Lopez:

Unless you're like, there are certain circumstances where it

Matthew Lopez:

makes sense, but most of it's Nope, no, one's going to steal that.

Matthew Lopez:

No, one's going to do anything about that.

Matthew Lopez:

And no, one's going to even know about it.

Matthew Lopez:

One of the, one of the Lawyers that I work with on a regular basis.

Matthew Lopez:

He works with a satellite company and I was, I got approached

Matthew Lopez:

by this manufacturer, like a satellite manufacturer.

Matthew Lopez:

They manufacture this piece and they're a startup and they're, they've

Matthew Lopez:

done prototypes and all this stuff.

Matthew Lopez:

And I thought it would be a great connection because I thought the satellite

Matthew Lopez:

company might want to invest in it.

Matthew Lopez:

They'd never even heard of this company.

Matthew Lopez:

And they're like, this is perfect.

Matthew Lopez:

Like we want to invest and all of this stuff.

Matthew Lopez:

And it's like most companies that are even in your space have never even heard of

Matthew Lopez:

some of these startups, because it's just, they're too busy doing their own thing.

Matthew Lopez:

Nope.

Joshua Maddux:

Yup.

Joshua Maddux:

Yeah.

Joshua Maddux:

Yeah.

Joshua Maddux:

And that's just, it's crazy when you look at all the startups and oftentimes

Joshua Maddux:

there isn't necessarily a unique idea.

Joshua Maddux:

Maybe a unique execution of the idea or a unique marketing elements.

Joshua Maddux:

We look at things like, Uber and Lyft and all the competition in that market.

Joshua Maddux:

And you look at food delivery apps and you look at, at the end of

Joshua Maddux:

the day, it's, they're all similar smalls, all very similar set up.

Joshua Maddux:

It's just different execution and who marketed it better.

Joshua Maddux:

And, there's some different elements to me learning like customer service.

Joshua Maddux:

That's a huge element.

Joshua Maddux:

You've got crappy customer service.

Joshua Maddux:

You're not lasting long.

Joshua Maddux:

Yeah.

Joshua Maddux:

Awesome.

Joshua Maddux:

As we wrap up, what is your sort of biggest advice your big

Joshua Maddux:

piece that you would give as a takeaway for someone who is.

Joshua Maddux:

Maybe in the startup stage or a small business who is facing the challenge of

Joshua Maddux:

what do I do from a legal perspective?

Joshua Maddux:

Whether that is they're looking to file for an LLC or they're looking to

Joshua Maddux:

figure out, legal setup or they just have no clue what the heck they should.

Matthew Lopez:

If it's time to reach out to an attorney and a lot of

Matthew Lopez:

attorneys will give you at least a little bit of face time and kind of

Matthew Lopez:

point you in the right direction.

Matthew Lopez:

At least for me, there's a lot of startups that approached me and they

Matthew Lopez:

asked me for help and they want me to, they want me to come on board

Matthew Lopez:

and it's no, you guys are too early.

Matthew Lopez:

I will point you in the right direction and kind of.

Matthew Lopez:

Talk you through some of this stuff and maybe do a monthly meeting with you.

Matthew Lopez:

And that's kinda, you want to start finding advisors and that

Matthew Lopez:

applies to all of the areas.

Matthew Lopez:

Your Rolodex is your most important asset that you own as a business entrepreneur.

Matthew Lopez:

And so being able to just go talk to people, don't be afraid to start

Matthew Lopez:

a conversation or ask people for help experts, love giving help.

Matthew Lopez:

That's why they do what they do.

Matthew Lopez:

And so just ask for help is the best thing you can do.

Matthew Lopez:

I think as you're in that spot.

Joshua Maddux:

Yeah, that's good.

Joshua Maddux:

That's good.

Joshua Maddux:

Yeah.

Joshua Maddux:

It's.

Joshua Maddux:

One of the things I would say not to do that I did when I started

Joshua Maddux:

my business was I used what the attorney, who I hired to fix it all.

Joshua Maddux:

He called it legal doom legals, and

Matthew Lopez:

do not use that.

Joshua Maddux:

Yeah.

Joshua Maddux:

It cost me more money to fix all of my filing than it did

Joshua Maddux:

than it would have to do it.

Joshua Maddux:

The first time.

Joshua Maddux:

yeAh.

Joshua Maddux:

And I know a business

Matthew Lopez:

owner, correct.

Matthew Lopez:

I know a

Joshua Maddux:

business owner who did something online service similar, and they

Joshua Maddux:

messed up the filing and they went back to them and said, Hey, can you fix this?

Joshua Maddux:

And the company was gone like, and so it was just like fly by night disappeared.

Joshua Maddux:

Finding the right attorney, who's going to do the due diligence.

Joshua Maddux:

Do some research if you're filing an LLC to make sure that there is

Joshua Maddux:

no the business, I just mentioned that there was actually a another

Joshua Maddux:

company under a similar name and the company sent them a cease and desist.

Joshua Maddux:

They need to change their name because they're operating in the

Joshua Maddux:

same space and all that mess.

Joshua Maddux:

And finding an attorney, who's going to be there for the long haul, the business.

Joshua Maddux:

Not just someone who's going to give you advice once and leave, as you

Joshua Maddux:

were saying, finding an advisor who may be, you can have a monthly or

Joshua Maddux:

quarterly or annual meeting with, even an hour of an attorney's time, once a

Joshua Maddux:

year, once a quarter is so beneficial just to, get the basic aspect.

Joshua Maddux:

So we're good and avoid legal zone.

Matthew Lopez:

And I don't want to bash, I don't use legal zoom, but there are good.

Matthew Lopez:

I was going to say legal sites out there.

Matthew Lopez:

Yeah, there are for sure.

Matthew Lopez:

Like right now, a lot of the times when I have companies that want

Matthew Lopez:

to do LLC filings or C corporation filings, I don't want to do it.

Matthew Lopez:

It's going to cost them too much money for me to touch it.

Matthew Lopez:

They're really good websites out there that.

Matthew Lopez:

But you have to know which ones to go to like legal zoom is not one of

Matthew Lopez:

them they're not built for doing that.

Matthew Lopez:

It's you have to know exactly what you're doing in order to use it.

Matthew Lopez:

And it's not a, it's not a friendly service.

Joshua Maddux:

The challenge that I had with legal zoom specifically was

Joshua Maddux:

the fact that you get this page and says, do you want option a or option B?

Joshua Maddux:

I don't know what the heck the difference is.

Joshua Maddux:

And then you get a one sentence description.

Joshua Maddux:

B Gas.

Joshua Maddux:

Sure.

Joshua Maddux:

And what you really need is you need to hop on a call with someone, even if

Joshua Maddux:

it's for 15 minutes to 30 minutes and explain your business, what the legal

Joshua Maddux:

entity that you want to set up, are you planning on having a thousand employees

Joshua Maddux:

or one, walk through some of those things?

Joshua Maddux:

And what the next five years, the business looks like, because what you

Joshua Maddux:

don't want to do is file as an LLC and then 12 months later, change it to an

Joshua Maddux:

S-corp and then 12 months later, change it to that just gets to be a mess.

Matthew Lopez:

Yeah, but there are reason, like I have advised startups to do LLCs,

Matthew Lopez:

to turn into as corporations, but you have to understand why you're doing it.

Matthew Lopez:

And that's really where it comes down to.

Matthew Lopez:

I you're completely right.

Matthew Lopez:

Is go talk to an attorney for just at least 30 minutes, let them understand your

Matthew Lopez:

business and then advise you on how to do.

Matthew Lopez:

Then you can go do it yourself with the different resources, because

Matthew Lopez:

there's great resources out there.

Matthew Lopez:

You don't need to have the attorney actually do all of the filing, unless

Matthew Lopez:

it's a complicated business structure, but when it just comes to this basic

Matthew Lopez:

stuff, like there's great stuff, but you need to know exactly what.

Joshua Maddux:

Yeah.

Joshua Maddux:

Awesome.

Joshua Maddux:

For those who may want to reach out to you, I do have your LinkedIn or

Joshua Maddux:

include that in the show notes below.

Joshua Maddux:

That's probably, is there other another great spot to

Joshua Maddux:

connect with you or that's it

Matthew Lopez:

thAt's a great spot.

Matthew Lopez:

Like we're a referral only.

Matthew Lopez:

We don't do any marketing where a boutique law firm that handles this space.

Joshua Maddux:

Awesome.

Joshua Maddux:

So if you're an early stage startup looking for a general counsel or

Joshua Maddux:

a fractional general counsel yeah.

Joshua Maddux:

Reach out.

Joshua Maddux:

Sounds like you guys.

Joshua Maddux:

I know at the beginning of the show or pre show, I think it was, we were

Joshua Maddux:

actually chatting and you guys were pretty busy right now, which is good.

Joshua Maddux:

It's good to hear.

Joshua Maddux:

Yeah.

Matthew Lopez:

Where we're swamped.

Matthew Lopez:

We're taking on a new client pretty much every week.

Matthew Lopez:

We're hiring extensively.

Matthew Lopez:

And if anyone's an attorney that's watching this feel free to reach out if

Matthew Lopez:

you're a corporate attorney or hiring.

Matthew Lopez:

But yeah we work with all different sizes of businesses, so just not startups, but

Matthew Lopez:

anyone that's mid-sized will we help and work with, so it's a really cool space.

Joshua Maddux:

Awesome.

Joshua Maddux:

Perfect.

Joshua Maddux:

I appreciate having you on the show.

Joshua Maddux:

And for those who want to reach out, like I said, LinkedIn, a

Joshua Maddux:

URL will be in the show notes.

Matthew Lopez:

Awesome.

Matthew Lopez:

So thanks for being on, appreciate the time.

Joshua Maddux:

Thanks for listening to this episode of, in the bunker.

Joshua Maddux:

As always we can be found on Instagram, Facebook, and Twitter

Joshua Maddux:

at, in the bunker podcast.

Joshua Maddux:

Be sure to share this episode and what you're going to apply from it.

Joshua Maddux:

And how that can affect your business, make sure to tag us in that post so

Joshua Maddux:

we can highlight your journey as well.

Joshua Maddux:

But before you go.

Joshua Maddux:

I have a quick personal ask.

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