The Pomp Podcast - #1261 Constantine Karides on How To Use Your Lawyer To Win In Startups

Episode Date: October 14, 2023

Constantine Karides is a partner in Reed Smith’s Financial Industry Group, Office Managing Partner of the firm’s Miami office, and the co-lead for On Chain: Reed Smith’s Crypto & Digital Assets Group.  This discussion was recorded at the BUILD Summit in New York. In this conversation, we discuss what a startup founder can do to evaluate law firms, test their competency, and how to work with them in the early days of your company to ensure the greatest success possible. ======================= Auradine, a leader in web infrastructure solutions including blockchain, AI, and privacy, has unveiled the world's first 4nm Bitcoin mining systems, featuring breakthrough EnergyTune™ technology, setting new standards in performance and energy efficiency. The Teraflux™ product line from Auradine offers best-in-class performance, efficiency, and total cost of ownership (TCO), positioning it as the optimal choice for Bitcoin mining needs. With EnergyTune™, a patent-pending technology, Auradine's Teraflux™ systems enable rapid demand response and optimal energy usage, fostering a symbiotic relationship with electrical grids, and contributing to sustainable energy practices. Designed and manufactured in the US, Auradine's Teraflux™ product line not only ensures cutting-edge technology but also mitigates supply chain risks and provides increased supply chain resiliency. Visit ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠www.auradine.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ for more information the Teraflux bitcoin mining systems. ======================= Get Better Crypto Data: Do you want faster, easier crypto data? Sign up for Velo Data, a new product that we have been working on to solve this problem: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠velowaitlist.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ======================= Pomp writes a daily letter to over 250,000+ investors about business, technology, and finance. He breaks down complex topics into easy-to-understand language while sharing opinions on various aspects of each industry. You can subscribe at https://pomp.substack.com/

What's up, everyone? This is Anthony Pompliano. Many of you know me as Pomp. You're listening to the Pomp Podcast, which is my effort to find the most interesting people in the world and sit with them for hours while I ask questions in an effort to learn. So it would mean the world to me if you would subscribe to the show on your favorite audio platform, watch episodes on YouTube, and tell your friends and family about the podcast. My goal is to help millions learn from the world's most interesting people. So let's get into today's episode. The following episode is with Konstantin Kouridis. Konstantin is a partner in Reed Smith's Financial Industry Group. He's the office managing partner of the firm's Miami office and the co-lead for Onchain, Reed Smith's crypto and digital

assets group. In this conversation, Konstantin and I discuss what exactly a startup founder can do in terms of their law firm, both in evaluating who to work with, how you can test their competency, and then also how you can work with them in the early days of your company to ensure the greatest success possible. Constantine is a lawyer that works directly with all of my companies and someone that I've really enjoyed getting to know and someone that I trust when it comes to giving out advice in terms of how to work with a legal team. And so this conversation does the best we could during the Build Summit where 700 founders came together in New York City to try to unpack how you, as a founder of a company, can work with your legal team to ensure the best outcome.

Here is my conversation with Konstantin Karidis. Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only. new infrastructure, and that is where Ardine comes in. They just launched their first product line called Teraflux, which is a Bitcoin miner powered by the world's first four nanometer silicon chip

technology. These air cooled single phase and dual phase immersion cooling miners have unrivaled speed and efficiency. They have superior uptime and they leverage a brand new innovation called EnergyTune that allows miners to dynamically adjust the energy consumption and Bitcoin hash rate based on demand response needs of the electrical grids. Auradine is an ambitious company working on hard problems. I'm really impressed with them. And if you want to check out more, you can go to Auradine.com. That's A-U-R-A-D-I-N-E.com. Go check them out at Auradine.com today. Before we get into this episode, I also want to tell you about a brand new product called Velo. Velo is faster, easier crypto data. Everyone in the industry is always

looking for? What's the price? What's going on on the exchanges? Where are assets flowing or not flowing? How is things like open interest and derivatives actually playing out in the market? Well, that's where Velo comes in. It's faster and easier crypto data. You can go to VeloWaitlist.com today. Myself and a couple of friends, we invested in the business. We're advising the founder and we think it's pretty cool. This one is something that keeps me informed on a daily basis. So you should check them out at VeloWaitlist.com. That's V-E-L-O Waitlist.com. Our last speaker of the day is actually my lawyer, which before you get up, I want to tell you guys a quick story about Constantine. So Constantine works at Reed Smith.

Reed Smith is one of the top law firms in the country. And for many of you, you probably don't know this, but your lawyer, as you start to build companies is probably one of the most important people on your team that you don't treat the same way that you treat your employees. Like you go through a huge interview process and then you're just like, who's the cheapest lawyer? Like probably a stupid idea or way to do it. So I thought a great place for us to start is just when you are hiring your lawyer you're starting a company you need a lawyer you need to get incorporated you need to put all the documents together you want to be able to set kind of the groundwork of the business how should we grill you to make sure you're the right guy or

the right firm yeah thanks it's great to be with you all today and um uh good luck with all your ventures uh i've heard some really interesting um ideas and opportunities so uh i'm in the right place, I think. In terms of your question, Pomp, look, I think you shouldn't just go to the first person that you're introduced to. I think that would be unwise, unless, of course, Pomp makes that recommendation. But putting that aside, you want to make sure that your law firm and your lawyers know your business. They have to know your technology. They have to know your business objectives. They have to know how you like to work. And they should be able to be a sounding board to you as you consider your next moves. So I would say right up front, you want to talk to

your lawyers and make sure they have the technological range to understand the scope of your business processes and technology. Because if they don't, you're going to miss a bunch of things. Now, how can you test them? I think this is one of the most, as you and I have talked over the years, like testing your lawyer to literally be like, like, are you the savage that I need to, cause you know, a lot of people are looking at it like, Oh, put together my documents. Like how bad could you screw it up? Newsflash pretty bad. Um, but also as the business gets larger, you're going to deal with employee issues. You're going to deal with competition issues. You may deal with regulatory issues. Like it gets pretty hairy pretty quickly. And so how do you, how have

you seen maybe the best companies that you've walked away from the higher, like when they're hiring you guys and you're like, man, that company really kind of did their diligence and made sure we were the right firm? Well, I think the founders and companies that are the best to work through are people who are really confident in executing the strategy around what they know and being curious and inquisitive about the things they don't know. A lot of that tends to be in areas like law. And so being comfortable to ask questions that you're like, maybe this is a stupid question. It's not. And having a really thoughtful and engaging response from your counsel, I think, is critically important. So the best companies that we work with have leaders who, again, are really able and thoughtful about their primary business operations and processes,

but also can see the the larger playing field and know that there are a whole host of legal issues and legal traps and things they need to put in place um in order to be able to execute their strategies and i think the biggest thing i would say is at the startup level it's so critically important to build the foundation correctly because everything else layers on top of it as you go on to raising money to your next series into hiring people into giving out profit interest into considering the shape of your cap table etc and so i would be really it's really important to get that right when you're starting let's say that i'll start in a business tomorrow what are like the two to three big decisions that i have to get right

from a legal perspective in order to lay that foundation to be able to build a company and not have almost like legal debt later that i got to deal with yeah so i think first and foremost you have to have the right corporate form that fits your business objectives that corporate form needs to be right for a few reasons one is importantly maximizing your return on your time and investment in the business so things like usbs and and other notions around wealth creation and preservation are important even if you're like well i'm not really making any money right now you well you you you very well maybe and if you haven't set it up right you're probably gonna be in a position where you're i would say losing money but not really

getting as much um of the juice out of the business as you could and so on this specifically qsbs is the ability for people to get the first 10 million dollars or so tax-free uh on a sale or liquidation event but also things like getting equity from the business into a ria or an ira 401k anything like that and a law firm is able to help set some of that stuff up so there are a lot of there are a lot of folks who we partner with who are smart um to identify this space as ripe for people who will be great clients in wealth management or um m a or ipos down the the road we we do stuff with fidelity for instance um who runs this great cap table uh model that's the guy who runs the fidelity cap table clapping in the back um and so you can you can loop in

somebody who is really smart around uh wealth management trust and estate uh tax planning right up front for probably a really reasonable price because they want to grow with you they want to be sticky with you so that even though day one you know they're charging you a fixed fee that's you know appropriate if your company is a success well boy they're going to get to enjoy some of that success and properly so i would say so kind of combining those professionals right up front is really important and I think is available. And you may not know how to do that or how to go about doing it, but a good law firm or good lawyer will have those relationships and will bring those folks and their voices into play right up front so that you can really build the right foundation

for your business. Talk about litigation is something as companies grow. Usually, in my experience, startups don't go around looking to sue people. It's usually the opposite. People go around looking to sue startups. Sometimes it's incumbents because they feel like they can bully a smaller company with less resources. Sometimes it is people who have left the company, former partners or vendors. There's all kinds of different groups of folks who see specifically around times when they raise money and they're in the headlines and like, oh, you just raised $15 million. That sounds like I should get some of it. You guys are laughing. I've seen it literally tens of times. How should founders think about some of these in preparation? Make sure I'm

prepared for when this stuff comes. Then also, you get a letter. It's a demand letter. It's a cease and desist, et cetera. What does that look like from a communication standpoint to your law firm? Sure. The biggest source of disputes at the founder and early stages of a company is between the folks who were, quote unquote, technically part of the initial group who received some sort of equity allocation or some sort of profits interest that the founder either quickly figures out six months into it, well, this person actually can't function as a CTO. Now what do I do? I've given him or her 5% of the company, and that's a horrible situation to be in. So we see a lot of issues around that. Or you have folks who've resigned and somehow

think that their equity is worth something, even though the company's in the building stage, and start making demands or hire aggressive lawyers to deal with it. So it's important to have people who've been through that process and know how to actually engage. I would say Number one, be extraordinarily thoughtful about who you allocate equity to at the initial stages of your company. Apart from not wanting to dilute yourself, you also don't want to create stress or drama because that wasn't the right person to allocate it to. And so obviously there's ways to have people earn into equity, but because we sometimes take over clients after this initial setup, we're having to kind of go back and try to redo things that could have been done properly at the right time. On the litigation standpoint, you just have to have somebody who's got a spine and say, sorry, nothing's going to happen. You're not getting a penny. Goodbye. And deal with it that way.

So there are some law firms. I've got tons of companies who work with like my brother's best friend runs a law firm and it's like three lawyers. they're cheap um there's other law firms like you all where former federal prosecutors and just you know a who's who of people who have been in and around law and very experienced etc um is there a right time and a wrong time to engage a large law firm versus small law firm or like different type of work that you should work with one law firm over another or should you have just one law firm or should you have multiple that's a great question i think um first i'll start with your prior speaker talking about some big m&a that's where you want to bring in real experts and the outcome of that m&a is such that you're not really worried about what the legal fee is

you're worried about making sure the deal is done right and you're getting everything you're supposed to and not have any tail liability so you start there as a you know high maybe highest point in the process. But when you set up a company, there are firms, ours included, and others who look at the startup and founder world as a tremendous opportunity to onboard great potential long-term clients. So there are models of pricing that those firms have that I think are digestible by startups um but with both parties especially if there's a good fit um culturally and personally see this as a you know five ten year relationship ending with hopefully very exciting monetization event or longer um i think because the very first things you do in forming your company

are really important it's not necessarily has to be a large law firm but it's got to be a really competent firm that's done it a lot. And so a boutique firm that has the experience is just as fine as big law in that context. I wouldn't respectfully hire your brother's three-person law firm for that anyway. I'd bring him into maybe something else. So I think I would be, if I'm allocating resources at a startup level, I think I'm tipping a little bit more in the legal pile than in other piles because of the long-term impact of getting it right small companies 10 20 employees or less when they have a board meeting i try my best not to have to go but if i gotta go it's usually the founder and the other board members and that's it any startup

that is series a maybe b or beyond there's a lawyer in the room yeah why is the lawyer there and at what point should the lawyer be showing up to the board meetings the lawyer in that in that in that setting is acting as a secretary they're taking notes and they're transcribing those notes and circulating them should be as a courtesy to a larger relationship by the way if you're getting charged for that you shouldn't be just fyi um but that's why they're there and they're probably not there at an earlier stage because of the cost or disinterest in having them involved that early. You'll probably have less outside investors at that point. Once you start assigning board seats to your strategic investors, you got to have it all look and feel like they're

comfortable having it. So along these lines, one of the things that I appreciate about you guys, and I've learned over the years from great founders is a lot of times there becomes a decision to make. And the founder almost always kind of knows what decision they're going to make. And sometimes they just make the decision, which is fine. If it ends up being a bad decision, it becomes a lot of questions.

And the best founders I find, they know what decision they want to make, but they go talk to their board. They talk to a couple of investors. They may even talk to their lawyers and get feedback and then they probably still make the same decision they were gonna make anyways but what is the importance of uh kind of communication but also a little bit of like cover your ass and make sure everyone's on the same page and kind of how a law firm can play into

that i think you know the best relationships i have with my clients are where i'm acting sort of as a consularity to the ceo or founder that's simply the role i'll play in terms of our team And in that context, you can have really open conversations, all privileged, of course, about those types of decisions and how to execute them. And there's always a variation of ways you can achieve that. You can have the lawyer push it or bring it up. I mean, if it's not controversial, it doesn't matter, obviously. But we're talking about things that might have a little hair on it or may not be as popular as you would like it to be. And just to clarify what I'm talking about, I've seen how did you spend the money? Who did you hire? Why did you hire a specific vendor? Why did you want to buy that company? Why did you want to run a certain campaign? I mean, these are decisions that usually almost always involve money.

Yeah, right. For sure. Yeah, I think, look, I've been on some board meetings recently, actually, where the where the CEO was asked to reduce budget expenses, not a more common thing past year or so, as you know, and didn't really have a plan or a clue. and the board members were really really pissed and they basically told him that if he didn't have it done in a week he was fired right and so that's pretty heavy so my advice would be number one know exactly what you want to do and justify it completely especially in that context when it deals with money you're you're the one who knows your business best and the people on the board don't they know they don't but they also don't want to hear somebody who lacks confidence about their vision or their execution so if you hired somebody for something and it didn't work out own it i thought this would be great for these reasons it didn't turn out that way

now i know and we're gonna pivot to x y and z trying to hide stuff or kind of pushing the blame onto somebody else comes off really badly i think um and unless there's like a legal mess up in it you're fine you know that's you know if the business doesn't work it doesn't work but i think you need to have that kind of sense of vision and confidence when you're talking about difficult decisions you've made at what point do you hire a general counsel and bring someone internal and then what is their relationship or role in terms of working with external counsel so and and i hate to start an answer like like this but it kind of depends on the nature of your

business there are certain um companies that really can get away without an internal general counsel really for a long time right up until perhaps they're starting to contemplate an exit of some kind and that's because their business is commoditized maybe that's the bad word but it's a repetitive business. It doesn't really change that much. The documents and the agreements are fairly similar and the same. The revenue is the same. You know, they're building, building by adding customers. And, you know, if you want to bring in a GC at some point and take in the legal work because you might be saving money, maybe you start thinking about that at some point. So that's one type of business. But if you have a biotech business that's highly dependent on

patents, making sure they're in place, looking at the landscape around how those patents are prosecuted, or trademarks, or dealing with intellectual property issues all over the world, or you're constantly engaging with counterparties, whether they be potential new investors or contract partners where you're processing a high volume of documents, I might hire somebody internally at that point. I do think that once you reach a certain scale, you want to have a chief legal officer in place because it's not the highest and best use of your time to be dealing with that stuff. There are ways to kind of do it with outside law firms. They have programs called secondments where they lend you a lawyer and you pay them a fee and that lawyer works for you

exclusively, even though they're an employee of the firm. And that's one way to do it. And the interaction between a general counsel and a lawyer is that person is the funnel of all legal matters that come up. They kind of decide what requires outside counsel to do it and what they can do it themselves. And they should be building a relationship with the relationship partner at the firm you're working with. On that point, I think this is important for the audience to know is it's really important to have a really strong relationship partner at a law firm that you're working with because the way law firms work is depending on the cloud you have within the firm you can achieve certain outcomes for your clients that maybe other folks within the firm can chiefly around better pricing making sure the teams are you know have the best

lawyers on them delaying payment or in some instances or um you know bringing in third party relationships that they have because of their position within the firm. So that's an important part of your process too, as you consider outside counsel, is the person who's leading the relationship, somebody who is well-regarded and in a good spot within their law firm. So this conference is free for everyone to show up, but I'm going to save them all money? Yeah. How do they save money with their law firm? Well, I mean, it's a great question. I think there are certain functions and tasks that lawyers do that don't require five or six lawyers on them which you may see sometimes if you're dealing with law firms you're wondering well who's that person

up in the corner why is that person over there and am i paying for all these folks before we actually get to this uh some people may not realize when you get on a call with a lawyer you're getting billed for every person that's on the call so if you have little experience with lawyers, if you get on a Zoom call and there's five people, you're not getting billed on an hourly rate of one of those people. You're getting billed all five of the people. And so you're saying maybe you only need one or two instead of five. Well, I'm saying there aren't that many situations that require more than one or two lawyers on a law firm, especially if they know what they're doing, especially given the nature of your businesses. On these big deals that we

were talking about, yeah, there's going to be a lot of people on the deal, but you want that. so don't be afraid to ask why is this person on the account why is that person what is he doing what is she doing you'll quickly save money by asking those questions you know when you see a first-year lawyer on a deal you know first-year lawyers don't really know much they're learning they're training then you know if they're on your deal you're paying to trade them so that's not necessarily a great use of your resources so these are things that I would look to ask I think you can have a very direct conversation with your relationship partner and say here's the budget that i'm planning for this transaction this matter this litigation and just have an open

conversation more often than not you'll probably reach a place where it works for both sides but if you're wildly off you should know that right up front and whether or not this is the right firm for you so i think this is a really important point because most young founders specifically they get on with the lawyers and then there's always like the bill and when the bill comes they're like holy shit this is expensive right what you're basically saying is if you know that you need something whether it is i need help with this regulatory thing i need help uh we're buying a company whatever talking to the law firm up front and saying this is what i think i need can you guys give me some sort of ballpark as to what it's going to cost and therefore that prevents

immense shock there still may be some variability in the bill depending on the work done yeah i think it's a two-way thing especially when we're dealing with with um new companies or folks who maybe haven't engaged with a law firm like ours um that frequently we also know we also don't want to be surprised at the end of the day it's like well i'm gonna remember that uh so we like to kind of engage and say okay here's what we're thinking for a budget what are you thinking uh is your you know here's why we think you know just like any pricing um interaction with anyone so you we want to have that conversation as much as um you all do not every firm does though they'd rather surprise you sometimes and say okay well you owe us this money by the way not a good idea

to tell the lawyers i'm not paying that they're lawyers um let's talk maybe a couple of war stories like maybe don't scare everyone but like when you're starting a company you're ambitious you're excited you think you're going to get rich all the benefits of entrepreneurship can you tell us a story that will make people question whether they should start a company after understanding some of the complexities and challenges from the legal side uh yeah sure i mean you know it's it's rarer than not but you know we've seen companies that have been started by people who thought they were really great friends or were both going to contribute um very different but valuable services to the company and it turns out one or the other didn't or and these are

multiple horror stories uh or someone stole the code and you can't find the code and this is my brother-in-law and now we're going to sue them and these are not like mom and pop stuff these are really good companies we thought that fall apart because of those reasons and end up in horrible litigation. So I kind of come full circle. You really ought to know who you're going into business with if you're giving them an equity interest in what they're doing and make sure they don't end up in a place where you can't stand them. And I'm not saying that glibly. I mean, literally, we've had to be in the middle of conversations between the founder and the CTO or the CMO because they won't talk to each other because I didn't say I was going

do that and i feel like i should have more and that only happens by the way when the company is worth more is when you realize you you should have kept more for yourself um so a lot of that interpersonal stuff it can get really really ugly and we could probably write a book about it yeah um another key piece i think to a law firm is uh some law firms are what i would call like litigation hungry yeah at the drop of a hat they want to sue everyone it's like go scorch your earth and um in those scenarios obviously they're driving fees but also there's sometimes ego or intellectual you know uh kind of uh reward from going and doing this stuff but when you're dealing with corporate matters having a law firm i think that like

wants to avoid litigation but if gets pushed yeah can end the litigation sure for for sure the other war stories i would say before i address this is um arguments or just shock between you know founders and owners of their company and their um series a or series b investors who you know if you haven't really protected yourself in the right way you end up seeing founders like well why am i i feel like i'm working for so and so well i mean if we had been in here a little earlier we maybe would have been able to help you on the documentation but you kind of are and that's a horrible position to be in and you don't want to work right um the way you had envisioned and again this comes back to make sure your

documents are right make sure the people who are negotiating with your investors um are protecting you we we stepped into a scenario where the founder who's tremendously talented um fashion um person she was like is this she shows it is this right uh and then she was showing me the board composition. This is her company. She just launched it. She would have two seats and the person who gave her some money on the seat would have three seats. And I'm like, nope, that's not right. That's your company. And it sounds obvious, but it's not necessarily obvious because when you're starting a company and someone's going to write you a big check, you're like, oh, you should probably get something. And your lawyers really need to be out front on that issue for

sure. But then coming back on the litigation point, that's one of the biggest quicksands a startup or early stage company can have. It's super expensive. It creates tremendous uncertainty around your company. It obviously wards off potential investors because they don't want to invest in company litigation. So not being in one is a great idea, but knowing how not to be in one is an even better idea. And so if you get sued or someone's threatened to sue you, stay calm relax and don't be afraid to engage somebody just to say okay i'm going to call them and try to work this out as opposed to they just said this we need to hit back with that and we may get there and when we do we'll we'll hit them hard but kind of trying to negotiate mediate

and work through issues is really important we had a situation where where a client had a disgruntled uh executive i would call him president level who just up and left and then thought he had a put right on the equity he had which he didn't and hired some really nasty law firm to say we're going to sue you to collect this money and you know we were like well you just own shares you don't actually have any of these rights and threats and threats and threats and then just really oh we're going to go to the lawsuit we're going to sec and so you're going to stick we stuck with it had a bunch of conversations sent them a notice said you're a regular shareholder please

you know stand down and ultimately they just faded away when they realized we were going to go for their bluff you know someone less experienced might have wrote back a letter and started off a war which would have i think really hurt the company in that instance so it didn't hurt that the person on our side who was having those conversations as a former federal prosecutor to your point so they know there's some real teeth behind that if it doesn't fall apart um but by and large i think that you know you're gonna if you sometimes you gotta fight and you fight but again that's a real big distraction for your guys businesses so

avoiding that's probably a better idea if possible it's a classic sometimes the best way to fight is not to fight at all yeah that makes sense um before i let you go uh help folks understand i think um when you're evaluating the law firm can you try them out again i didn't hear what you said can you try them out and what i mean by that is um a lot of founders they may go through the process we talked about earlier testing and talking to a couple i find that they just hire the law firm and then it's like you're a law firm and many of the successful founders um hey here's a project you know work on that first and almost there's like a double opting into the relationship until eventually it's okay this is the law firm that we're going to go with for either all or

majority of the legal work like what have you seen on that front um that companies have done well you know it's fun excuse me it's a it's a funny um thing to watch sometimes where you can see especially last 18 months really smart people pivot the entirety of their business successfully and change a lot of what they're doing and yet when it comes to their lawyer who they don't like and it's just from personal experience find it like that you can't do that you know and it'll mess up the business it'll you know really um screw things up and that's just not true um to the extent you're not happy with your counsel you don't have to marry them forever In fact, the ethics laws that apply to lawyers require anyone who's been asked to stand down to be super helpful in transitioning work and deals and even sit with a new counsel to make sure they're fully up to speed.

So we have an obligation as a profession, if there's ever a change of course, to do that in a way that doesn't cost much money to the client and make sure the client's business is seamlessly moved around. And so just like you would change out, I don't know, a non-functioning internal resource, you can do that with a lawyer maybe in an easier way. Now, you don't want to get in the habit of changing your lawyer every few hours, a few months, because that will make a bad impression. One, that would cause disruption internally, but it would also not be a good look to the investor community. And I guess on that point, the big law firms, there's not many of them, and investors know most of the lawyers. The lawyers eventually meet most of the companies. And so there's obviously attorney-client privilege, but I do feel like a lot of investors understand what it means when certain law firms work with certain companies and then also if certain law firms are not being used. And so how does that play into either the law firm that the startup chooses or even potentially investors that you're actually going to raise from, et cetera?

So a couple of things there. One, you know, there's investment firms that you want to engage with that will have a certain expectation as to the counsel you're using, both in terms of quality and ability. and when it's with a firm they know or is within a bucket of firms that they deem is an acceptable segment of the industry um that's fine usually but i would you know this is a little counterintuitive to my my practice if you're a really good lawyer at a at a good firm i don't know they do necessarily have to jettison them without you know having an honest discussion with your investor if it's that important to you um because there are other lawyers who are very capable who aren't at a big law firm or at a you know highly renowned boutique that are you know

fine so that's a give and take between you and your investor um on that on that point in terms of you know you have to be very careful you can't obviously we we live by very um rigid conflict rules so we are not able to represent an you know investment firm into tech and then when we were representing company they invest into you know we have to get waivers from both sides and tell them oh we actually have a relationship over there and then they're all sorts of we can still move forward if everyone wants us to with very specific rules around you can't have the same people working on it you have to kind of set up some ethical walls between the accounts and that happens a lot and it's not necessarily you don't need to silly work look

over your shoulder and say ah they're telling your secrets to the investment firm that's that's not happening where can people find you or find reed smith if they want you on their side well thank you they can they can call you right thank you you can direct me uh but i mean reedsmith.com and my name is constantine caritas it's uh it's pretty easy constantine and i have a lot of fun because every once in a while i just call him when i say hey what do you think about this situation and after he gets done talking shit to me and telling me how dumb i am then he gives me really great advice so i appreciate you yeah no uh pop like as he said i know what i'm going to do pop is the epitome of i know what i'm going to do before i talk to

anybody and i'm not actually sure you're listening to uh anybody as you go through that process but you know you have to go through it and then you end up exactly where you started out but you're mostly right that wrong well and constantine gave me a thumbs up perfect all right constantine careers everyone We'll be right back.