Lawyers are very skilled at creating legal documents and one of the values they provide to their clients is quality documents based on research, precedent and experience. So most of the time, a client would be in no position to suggest anything about the form of the legal document or the required language in a legal document. But there are some sophisticated clients and groups of clients who might have some opinions along this line. The link below just came across my Twitter feed today. I don't know any of the background. But allow me to paraphrase in a very unapproved and irreverent way what this particular group of investors seems to be saying about their posted online resource.
We at the National Venture Capital Association close many rounds of venture capital deals each year. We understand legal advice and paperwork is required. But we would love not to pay our lawyers so many millions of dollars to generate the paperwork for these deals. Because so many of these documents are organized differently based on the precedential documents from the various law firms, they are then very time-consuming for everyone to review. We have compiled these “best practice” documents and are making them available to everyone online—for free. If all the VC community would just use these as a starting point, think how much we would save in legal fees and how much easier it would be for us to review the documents. Oh, and, let us also note, with a bit of snark, that we think some of these form documents are better than some of those that some lawyers are generating for you now.
OK, before you become upset with me and want to shoot the messenger, please go to NVCA Model Venture Capital Financing Documents and decide for yourself what this group is doing and saying.
The Money Quote from the page: “By providing an industry-embraced set of model documents which can be used as a starting point in venture capital financings, it is our hope that the time and cost of financings will be greatly reduced and that all principals will be freed from the time consuming process of reviewing hundreds of pages of unfamiliar documents and instead will be able to focus on the high level issues and trade-offs of the deal at hand.”