Dealing with a large number of SaaS agreements is just part and parcel of running a SaaS company. From SaaS sales contracts to DPAs, MSAs, Software License Agreements, Supply Agreements – the list goes on!
When a SaaS lawyer charges between $500 and $1,000 per hour, legal fees can burn through your SaaS company’s resources faster than Usain Bolt!
Fortunately, there are alternatives. Hooray!
We’re going to explore our top 7 ways you can save money on your SaaS legal costs.
1. Go to a Startup Legal Clinic
A number of law schools offer free or low-cost legal advice and help to early-stage business ventures, a great way to save money on legal services.
Some of these clinics can be found at:
- Duke Law School (Durham, North Carolina)
- Santa Clara Law School (Santa Clara, California)
- Cardozo School of Law (New York City)
- University of Colorado – Boulder
- University of Michigan Law School (Ann Arbor, Michigan)
- Northwestern Law School (Chicago, Illinois)
- University of Virginia Law School (Charlottesville, Virginia)
- Nebraska College of Law (Lincoln, Nebraska)
- University of Washington School of Law (Seattle, Washington)
- UC Hastings College of Law (San Francisco, California)
Check with your local law school if it’s not listed here.
Some incubators, accelerators, and universities also offer legal services to startups on a deferred payment model in exchange for providing an equity stake in the company.
But be careful about what you’re willing to give up in the long run!
2. Find a Law Firm Willing to be Paid in Equity
Lots of law firms have benefited from investing in their clients.
However, being a SaaS lawyer as well as a shareholder in a SaaS startup can create a conflict of interest.
Law firms can avoid this problem by creating separate funds to hold the equity and require their start-up clients to sign a waiver of any conflict claims.
Both the equity stake and the value of legal services to be provided in exchange can be capped. This is a potentially good way to save money on legal services in the short term.
But be sure you’re willing to give up some of your equity in the long run!
3. Defer Fees
Some SaaS attorneys are willing to defer their fees until your SaaS startup is more solidly established.
A growing number of law firms in Silicon Valley are willing to defer their fees until the closing date of your first round of financing.
The way it works is that the law firm takes on the risk that your financing may not close and therefore their lawyers won’t get paid.
Sounds too good to be true? Get your facts straight and read the fine print!
If your SaaS startup has income from an early stage, a law firm may be willing to get paid on a “pay as you go” model – providing all of your startup’s legal services in exchange for a percentage of your SaaS company’s monthly revenue.
This can be a useful option early on when revenue is still fluctuating significantly.
5. Hire a Lawyer Online
There are lots of online services out there to help you find a SaaS lawyer.
Some of these services are nothing more than directories, whereas others will show you references and rate the lawyers themselves.
But remember, online legal services can vary widely in cost, and you don’t want to sacrifice on quality!
For example, on a service like UpWork you can post your legal request and get bids from all over the world. You may even be able to find someone willing to work for less than $20 per hour.
However, this person may not be familiar with the US legal system or even be fully fluent in English.
You might also find a brand-new graduate of a US law school who’s willing to work very affordably.
But on the flip side, they’ll have zero or minimal real-world experience.
6. Get Free Custom Templates with Superlegal
Your SaaS agreements can be heavily negotiated over a period of months.
If your contracts contain terms that are:
-off market standard
-onerous on your buyers
-not necessary to include
You’re going to invite endless rounds of negotiation that will waste you significant time and money. (Money that you may not have at an early stage of your startup!)
So you want to get off on the right foot with an optimal template that reflects market standards and industry benchmarks.
Optimal templates are far more likely to align with your counterparty’s expectations and minimize the time it takes to seal the deal!
Superlegal has just launched its brand new Custom Template feature, creating custom templates based on your needs and market benchmarks.
That way you’ll save hours of negotiation time and thousands on legal fees!
These templates can be custom built and downloaded here as part of Superlegal’s free trial!
7. Get your Contracts Reviewed with Superlegal
Superlegal is an AI powered contract and negotiation solution that helps you speed up your contracts.
Superlegal reviews all the contracts your SaaS startup needs, including:
- Non Disclosure Agreements
- Data Processing Agreements
- Master Services Agreements
- Product Supply Agreements
- SaaS Agreements
- Software License Agreements
- Purchase Orders
Superlegal takes your contracts off your desk faster and cheaper than any lawyer, so you can get back to growing your SaaS startup!
We’re helping SaaS startups by replacing their need for outside legal counsel at a fraction of the cost of a SaaS attorney.
Just upload your first contract with a few clicks and get it back, completely free, in just 24 hours!
If you’d like to see how Superlegal can save you 90% on legal costs – click here to check our free trial!