Budget Your Business

Not Legal Advice, Instead Legal Strategy to Apply in Your Business from Chris Way

• Scott Geller • Season 1 • Episode 27

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Creating a legal strategy becomes relevant and real thanks to Chris Way with Way Law.  

The key is proper prioritization. Chris shares his approach of addressing clients and business partners first before moving on to other examples. 

Chris continues to help us understand how to incorporate legal into the planning process before wrapping up with how to engage legal advice. 


Find out more about Chris Way: 

www.waylaw.com

https://www.linkedin.com/in/chriswaywaylaw/ 

hello@waylaw.com

Instagram: chriswaylaw


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Chris Way:

Just like the rules of tic-tac-toe or any other game, they don't say what is the best or optimal strategy for the player. They're just possibilities of what can and cannot happen. So a lawyer is useful as early as possible, as early as you can get them in, to help you build your strategy of how do I actually navigate these rules in the best way for me, which? In business is even harder because there is no single optimal outcome of this is clearly winning the game. It's hard.

Scott Geller:

There's no right or wrong, there's a lot of graves.

Chris Way:

Yeah, yeah. So the earlier that you can bring your lawyer in or a lawyer in, the better chance you have of maximizing success and your ability to maneuver within those rules.

Scott Geller:

Welcome to Budget your Business, the podcast for small business owners who want to financially plan for every aspect of their business. Today I have Chris Way of WayLock.

Chris Way:

Welcome, chris hey thanks for having me. I am very happy to be here.

Scott Geller:

Absolutely, and this is a treat. We're doing this one in person. This is actually the first time that we've done it in person. We're here at the Enzo Media Firm studio in Richmond, Virginia, and it looks great. It looks a lot better than what I usually do just sitting behind my computer.

Chris Way:

I'm honored.

Scott Geller:

you rolled out the red carpet for me, that's right, chris, I'd love to know a little bit more about you and kind of how you got to Waylaw.

Chris Way:

Yeah, absolutely so, okay. So, yes, your audience doesn't know me. I'm Chris Webb, the managing attorney at Waylaw, and what we do is we use legal strategy as a way to enable business strategy, and what that means is that what I want to do is find a way to make someone's vision possible. I don't want to tell them what they have to do. I don't want to tell them what they should do, what they can't do. I want to know what are you trying to do and how can I use law as a tool to help you get there? And I think that that is kind of the organizing principle of my firm, because of the way that I came to law, which is a very non-traditional way. Both of my parents are entrepreneurs.

Scott Geller:

And so.

Chris Way:

I have had a business in one form or another since I was nine. Oh, I like that. Yeah, when I was nine I had a little comic book company with my friends. We would draw comic books and we'd sell them for a quarter a dollar, whatever we could get. Yeah, All sorts of different business ventures, but the one that got me into actually being a lawyer was some friends and I started up a. We were 11, we started up a record label and that is a very generous description of it.

Scott Geller:

11-year-old version of a record label. Yeah.

Chris Way:

But I very quickly realized I had no musical ability, not at all Like my friends. One guy could play piano, another guy could sing, like kids All sorts of musical ability. Me not a bit, not even a little bit. But what I was really good at were kind of two things. One was seeing how to fit different things together to make something that was greater than the individual whole, and the other thing was I really enjoyed like talking to the DJ at a school dance and being like, hey, let my friend get up here and do something. That led to me feeling like, okay, this is what I want to do with my life. I want to help creative people do a thing. What does that even mean? Somehow, when I was 11, I don't know how, because I am old enough that Google wasn't really a thing at this time I somehow found the job intellectual property attorney at 11.

Scott Geller:

At 11. That's interesting.

Chris Way:

Yeah, I don't know, I don't know how I got there, I don't know, I don't know what library book I was looking at, but I found that and I was like that is what I want to do. Over time, the vision changed and what I realized was I really enjoyed the creative process outside of just art. Business to me is a creative endeavor. You are inventing a solution to a problem in the marketplace. You are being creative, and so I really liked supporting that aspect of creativity more so than specifically artistic endeavors, and that's what I've wanted to do since I was a kid, and Waylaw is kind of the culmination of that. You have this idea in your head.

Chris Way:

I want to help you figure out how to make it work.

Scott Geller:

I like that because it really plays into the purpose of this podcast too, which is really not just finance but really planning for your business. In relation to that, I read one of your LinkedIn podcasts recently and it was all around being proactive. So maybe let's start there, like how do you use what ways can a business be proactive from a legal side?

Chris Way:

Oh man, that's a great question. The best way to be proactive is and this is going to sound, this is a truism it's really just to do it, just to start. Don't worry about getting things perfect, just start, like for small business owners. Legal strategy is incredibly important. I can go into why later but sometimes it can feel very overwhelming because there is so much that you don't know. And then, of the things that you do know, you're like how am I going to do all of that? That seems impossible. I am a solopreneur, or I am me and two partners, maybe we have an employee. How are we going to do all of these things? And so that can kind of hold people back. That sort of this is overwhelming. Where do I even start? So I just won't start, I'll just put this off until something happens. And the key to being proactive is don't worry about perfection, don't worry about getting everything, just do it. And so when people I can't speak for all lawyers, but when people call me small business owners call me often what I'm trying to do is help them shape where to get started. Like there are.

Chris Way:

There are many legal things that a person could be doing, but your starting point is not necessarily the same as someone else. So what I want to do is help you figure out what are the priorities and what's the right order to attack them in. And now, instead of having to look at this massive thing that we've, we've got to try to do 15 different things, or we are legally vulnerable If we have a plan and a sequence of OK, this matters now because of this. Well, I've talked to somebody and now I know this thing matters, but it really can't afford to wait six months while we address something else first. That sort of clarity can really help things become more approachable and just more doable than having to face that wall of okay, I've got to do a million things.

Chris Way:

So yeah, I think that's the big one is just commit to starting and find a starting point. What's a thing that is a priority right now? Maybe feels the thing that you know the least about. Maybe it's the thing that you hear some grumblings about from other people in your industry, or certain clients are all kind of having this same situation where they are bumping into a problem with the relationship, meaning that they are seeing that relationship differently than how you are seeing it. So that kind of should tip you off. There's a problem there that needs to be dealt with. There's all sorts of ways that we can identify where do we need to start and where is the where we need to be proactive yeah, and I think A lot of small business owners that I talk to or deal with.

Scott Geller:

They're excellent at their craft. They're not always excellent in the finance area. They're all lawyers you kind of started touching on it there but they have a hard time knowing where to get started and knowing how to prioritize certain way that they should be thinking about that, or maybe it's you or somebody that they can go to to help them understand X should be prioritized over Z or over F.

Chris Way:

Yeah, there is, and this is very general. This is not legal advice, this is very general. But, generally speaking, when we're talking about prioritizing where to get started, I like to look at things in terms of most likely friction, most likely pain point. And so, generally speaking, your customers or your clients are going to be the most frequently occurring pain point that you're going to have, like out of the hundreds of customers, thousands of customers that you may have, or the tens. If you're doing something really, really specialized, it's a lot more likely that there's going to be a misalignment of expectations between you and that person than anyone else. It's going to happen more frequently, whether they thought your service included something that it didn't, or they thought that you were going to do something in a certain way that you weren't thinking that's what you were going to do, or just they're like I can't pay you or I don't want to pay you.

Chris Way:

whatever it is, it's more likely in most cases that friction is going to come there. So that's usually one of the places that I like to start. Let's understand your customer, your client relationship, how it works, how you expect it to work, what are they expecting from it, and then create some sort of an agreement that captures those expectations and literally puts everybody on the same page. That being said, that's not the universal starting point. If you have business partners, friction between partners is less likely to happen than friction between you and your customers.

Chris Way:

Like it is inevitable at some point some customer will not like something you did.

Scott Geller:

Not everyone's always going to be happy. Yeah, he thinks everybody all the time. Yeah, exactly it's inevitable.

Chris Way:

But any single customer has a limited one customer. If they're upset with you, it's not going to sink the whole ship. It's going to be. It's going to cause some damage possibly, but it's not going to sink the whole ship. Friction between partners is less likely to happen because you wouldn't have gotten together to do business if you didn't like each other, if you didn't have some shared expectations around how you wanted to work together and do things. So it's a little bit less likely to happen. But if it happens it is incredibly damaging to the business. That's the one that sinks the ship. So if you have partners, I typically recommend that's actually the place we start before we worry about the customer, Because if something goes wrong there, where you two step on each other's toes, it has the potential to do tremendous damage to the business, possibly killing the whole thing before it really gets off the ground.

Chris Way:

Because what a lot of people don't understand is that most business disputes are not happening because one person's trying to get the other.

Scott Geller:

That certainly does happen.

Chris Way:

Like one example I just gave.

Chris Way:

Sometimes a customer gets the work and is just like, yeah, I just don't feel like paying for it and there's no good faith reason why they're doing that.

Chris Way:

But a lot of business disputes each side has an entirely good faith reason for why they think what they think, and that problem could have been avoided by being proactive and getting everyone to have a shared framework of expectations about how this relationship works, because without that, each side is bringing kind of their common sense in to fill the gaps of things that were not explicitly talked about. So, yeah, common sense it works this way. Common sense isn't actually that common Like each of us can have different perspectives of what we thought something was going to be. So with business partners that happens because one person thought this very reasonably, another person thought that very reasonably and they never talked about it, and either it comes to a head very quickly or it festers and there's a lingering resentment that builds when there's people who are just not directly talking about it. Maybe they're trying to avoid conflict or whatever it is and so partnership disagreement is an area to prioritize, preventing and being proactive about.

Scott Geller:

Yeah, yeah, I've seen that, chris, I've worked with some companies. That infiltrates the whole business right, if there's a little bit of that friction, it can really be felt across the business. So let me ask you, because a lot of times I see at least from what I see is people can go out as a partnership on something. I don't get everything put together correctly up front After they get into the business. Is it too late to kind of put some of those pieces together?

Chris Way:

No, that's a great question. It's never too late. As long as you get there before tensions build, you're great. If the tensions have already built, it's still not unresolvable. It's just a little harder now and maybe each side is a little farther down the road of thinking that their view was the right one, and now there's going to be a little bit more difficulty, kind of putting the toothpaste back in the tube and getting everybody feeling good and harmonious again, but it's still not undoable. Um, so there's no situation where it's just it's too late, the horse has left the barn. There's nothing you can do like, unless you guys are literally screaming at each other in the office. At that point. It's that point it might be a little bit too late to sell, but who knows, maybe it's that's youtube's love language screaming it can't be um so yeah.

Chris Way:

So there's if you, if you feel like you've missed the window because you didn't do the proactive thing at the outset, as long as you're still ahead of major conflict, you're still being proactive. It's maybe not as proactive as it once was, but you're still ahead of the situation. It is still manageable. It's still something that you can get everyone kind of aligned and on the same page.

Scott Geller:

How do you? I don't know, maybe you have a recommendation around how one business owner approach that topic with another, because, imagine, it can be somewhat tricky, right? I mean, there's a level of trust and you want to break that level of trust and maybe going to someone and say, hey, we need to go talk to a lawyer about putting something in place. Are there better ways, or maybe worse ways, of starting that conversation? The best?

Chris Way:

way. Well, actually, I'll say the worst way first. The worst way, I think, is to just come to somebody and say you're doing this, this, this and this and I don't like it and I want to get a lawyer in here to draft an agreement.

Chris Way:

That starts the conversation on a terrible foot because, again, most likely the this, this, this and this the person was doing were being done in good faith Sometimes not, sometimes not Sometimes that person knows that they are being a jerk, but oftentimes it is done in good faith and so you don't want that to be the opening salvo of the conversation, pointing the finger and you do this and you did that.

Chris Way:

A better way to frame the conversation is hey, I've been thinking about how we started this business and we just jumped into it because we had an idea and we didn't take the time to make sure that we had the same expectations, one of the same things, wanted to run the business the same way and before things, you know, we have some disagreement. I'd like to let's sit down and talk with a lawyer and kind of iron things out, because not because I don't trust you, but because I care about you I want to preserve our friendship. I don't want some avoidable spat to pop up because we didn't talk about something. So this has nothing to do with me not trusting you. This is me caring about you and I want to make sure that we preserve a relationship, create and preserve a relationship that is going to last for a very long time.

Scott Geller:

Okay, I like that. Yeah, that's a really good, much better way than hey, this is what you're doing wrong. Yeah, so you touched on a couple areas to keep in mind. Prioritization, I like that. As a company's going through, let's say, an annual planning session, an annual strategic planning, what should they keep in mind? What?

Chris Way:

else should they keep in mind regarding the legal aspects for their business? That is a very broad question.

Scott Geller:

There's so many different ways that I could go with that one.

Chris Way:

No, it's not a bad question, it's just, yeah, how best to frame, how to answer that. Well, the key things I think to keep in mind as you're doing your annual plan are well, one I always like a SWOT chart. I'm a huge fan of that. For anyone who's unfamiliar with that, it's basically mapping out strengths, weaknesses, opportunities and threats, threats and opportunities. Those are external Strengths and weaknesses are internal.

Chris Way:

When you look at those, you can start to see, even without a lot of legal understanding, you can start to see that some of these things may bump into some sort of legal outcome, and so that can be a really helpful way to identify where are particular pain points and opportunities. And I like to think very much in terms of opportunities. I like to think that a lawyer is a resource for creating opportunities and maximizing value, not just reducing risk and limiting loss. So the opportunities to me are in the strengths. Those are just as important as understanding the weaknesses and threats, because often there are moves that can be made within any of those boxes, that there's some move of legal significance that can tie to it, but before you can even know what they are. Or, hey, I'm facing such and such and such and such. How do we turn this into a legal strategy? You need to know what the such and such is, and so I'm a really big fan of just annually sitting down and making a SWOT chart.

Scott Geller:

I like that. Yeah, I like those as well. I like putting things on paper, yeah, yeah, and I feel like it makes it more real. And then you do something like that. You know, do, do or put together a SWOT chart. It makes you put some of those on paper, it makes you think about it Exactly.

Chris Way:

It's just the process of seeing it, because, you know, business owners, we're thinking about our businesses all day long, thinking about it on the weekends. But having a tangible thing to reflect on and the process of writing it down makes you take a moment and analyze it, maybe deeper than you would have ordinarily done, and you can start to see some things. Especially if you do the SWOT chart not as a one time thing Let me work on this as over over the course of a week, so I have a chance to step away and come back and see if I missed anything you can really start to see where there might be some things that OK yeah that even with my non-attattorney limited understanding of the law, that seems like that may have a legal implication there, or that there may be something that I could be doing better that I'm not exploring.

Scott Geller:

So when and this is probably another broad question. I apologize up front if it's too broad, but when should a business owner start thinking about? When do I bring a lawyer in?

Chris Way:

Okay, bring a lawyer in, and this is a very lawyerly answer. It depends, basically, but it's kind of as early as possible. There's no universal right time. There's no X event happened. It is time to lawyer up. Maybe you got sued.

Scott Geller:

That's kind of obvious.

Chris Way:

Yeah, that's obvious Going to court, you need a lawyer. Yes, yes, don't show up by yourself. It's a terrible idea, but for most business owners who are not in that reactive situation, any time is a good time and it's really important to have one and to bring one in as early as possible. The law is kind of like what are the rules to a game? Any game that we play has rules. So chess, checkers, backgammon, sorry, whatever it is, sports, basketball, football, baseball they all have rules. Those rules dictate what a person can and cannot do. They don't dictate what is the best or optimal strategy in general and they don't dictate what is the best or optimal strategy in general and they don't dictate what is the best or optimal strategy for a particular player and their skill set.

Chris Way:

So while the rules of basketball may say certain things about legal guarding position and what is a foul and what's not a foul, there are various strategies that one can use to optimize how they interact within those rules. So you know, easy, easy example tic-tac-toe. We all understand the rules of tic-tac-toe. You know turn-based I'm X, you're O. Yeah, we're trying to get three in a row horizontally, vertically, diagonally. Those are the rules, but those say nothing about what is the best strategy to succeed at tic-tac-toe? Knowing those rules, we can now go back and say, okay, within the, within these rules, here's the best strategy for me. And there are strategies in tic-tac-toe where, if you run them right, you basically never lose. Right, you'll always get somebody where you're going to get them to one of two ways.

Scott Geller:

They go here exactly I enjoyed beating my son for a long time because he didn't know those rules.

Chris Way:

The law is the same way the law says you can do this, you can't do that. There's areas of gray in other places and those are. There's both public rules in the law and regulation and there's private rules in terms of contracts that we create between two parties. Those rules that we create, or let's go back, let's step back the rules that we are following in terms of law and regulations. Those public rules just like the rules of tic-tac-toe or any other game, they don't say what is the best or optimal strategy for the player. They're just possibilities of what can and cannot happen. So a lawyer is useful as early as possible, as early as you can get them in, to help you build your strategy of how do I actually navigate these rules in the best way for me.

Chris Way:

Which in business is even harder because there is no single optimal outcome of this is clearly winning the game.

Scott Geller:

It's hard, there's no right or wrong. There's a lot of graves.

Chris Way:

Yeah, yeah. So the earlier that you can bring your lawyer in or a lawyer in, the better chance you have of maximizing success and your ability to maneuver within those rules and then within the private rule setting your contracts with customers, vendors, with employees. You're not even just having to navigate, you're getting to create the rules in a way that shapes is shaped by your skill set and your capabilities and your resources is shaped by your skill set and your capabilities and your resources. So the earlier that you can get someone incorporated into that process for you and help you find what's the optimal way to navigate, what's the optimal way to create for yourself, the more beneficial it is.

Scott Geller:

Okay, that makes a lot of sense and at the same time you know CFOs are expensive. I hear that all the time. Lawyers, I think, may be even more expensive. I hear that from time to time. How does a small business owner who can't afford a full-time lawyer? Where do they go? What are their?

Chris Way:

options. Yeah, this one is this is a very common problem, like it plagues every small business owner, even larger companies, even larger companies. I think that the first thing to realize there, or to think about and how to solve that problem, is understanding that your lawyer, your legal strategy, is an investment. It's not really an expense. So the first thing is mindset like, yes, you're going to have to pay somebody to do it, but the first kind of mental hurdle to get over is understanding this is an investment. When you start to think about how you're going to use what the lawyer is going to do for you and how it is going to open up opportunities for you, it becomes easier to get into the mindset of oh no, this is important and this helps me a lot, so I should try to afford this. Because if it's more this nebulous, it's kind of like, well, yeah, I don't know why would I, why am I going to try to stretch to afford this thing? Whereas if you understand why it's important and what it can do for you, it becomes a little easier to go OK, no, this is important, I need to set aside money to do this, I'll create the money to do this.

Chris Way:

So that mindset, I would say, is one of the first steps. Like is one of the first steps. Like, for instance, a good service agreement. It does cost money to write that, but you are going to use that as the bedrock, foundational relationship structuring tool with every one of your customers. You're going to go out and try to make $100,000 or a million dollars or more with this single agreement. When you look at it that way, it is worthwhile to invest 1% of that in this thing that you will use over and, over and over again to bring you your revenue and make sure that people don't have areas to undercut you within that relationship. So just framing it that way, I think, definitely helps. Another thing to do is, once you have that done, actually start to create a line item for it and budget for it and say okay, how much?

Chris Way:

let me look at my net income. Let me look at my living expenses, my business operating expenses. How much can I put aside per month? And when you actually start writing things down, you may find there's $3,000 a month that is not being used elsewhere for another project. It might be $300 a month. Whatever it is, you can start setting that aside towards the smaller it might be monthly, it might take a little longer.

Chris Way:

Okay, I'm going to set this aside, but actually mapping out okay, where is there available money? Are there any things that I can do differently that help create available money? Because this thing again back to mindset I understand that this thing is important and trying to save some money now, which might be pennies to me or might be huge to me, depending on what my situation is there's the upside of getting this thing and being able to use it is much greater than the sacrifice of having to tighten the belt a little bit now. Yeah, Once you have that and you actually start setting aside something in the books of, yeah, this is our monthly line item, and over time, it may build up to a point where now, okay, this is our monthly line item and you know, over time it may build up to a point where now, OK, we have set aside the funds we need for what I think this might cost.

Chris Way:

Let me go talk to a lawyer. You can talk to a lawyer up front and, depending on what it is, we'll be able to tell you oh, yeah, this is about what that would cost. So you know what number you need to. You need to try to budget for and save to With me, my firm. One of the things that we really pride ourselves in is transparency. I never want someone to get a bill from me and be like the side of the envelope says I hope you're sitting down because you don't know what this is going to say. When a person calls me, as part of the initial consultation, I want to be able to clearly tell them this is, this is about what this runs. Here's kind of an estimated range, so they have a number in mind of what this is going to look valuable to you, and socking away money a little bit at a time or creating a specific budget item for it, and then it's doable.

Scott Geller:

And I would add, if you don't mind a little bit of that is, if you don't spend it in March, that doesn't mean it's a savings. If you're budgeting $10,000, or let's say $12,000 for the year, so $1,000 every month, just for example, and we're three months in it's like oh, we just saved $3,000. No, no, no, you just want to push that out. You want to keep it $12,000 because, more than likely, you're going to end up needing it.

Chris Way:

Yes, yes, I completely agree with that.

Scott Geller:

Well, Chris, this has been great. You've walked us through kind of how to prioritize, so some areas to think about, how to budget for a lawyer, as we kind of. I don't want to take up too much of your time, but as we wrap this up, what are you know? One to three takeaways that our listeners could, you know, as soon as I get off this podcast, walk away with maybe something you've already mentioned, and that's fine, but one to three takeaways in their planning process or something legal that they should keep in mind.

Chris Way:

OK. So Number one takeaway with legal strategy, just commit to doing it. Understand that this does benefit you. It doesn't have to be perfect. Good is not the enemy of great, but it is better to do something and start building out protection. You don't need to get all areas of the business covered at the same time. We can prioritize. We can start slowly and ramp up as we need in different areas. So I think that's a major takeaway. Somewhat related to that is that in law and business it's pretty much it's always better to be proactive rather than reactive. I have been beating the drum of being proactive for many, many years and it is so much easier to control cost, stress and outcome on the proactive side of things than on the reactive side of things when we are reacting.

Chris Way:

We are locked in. Our options are incredibly limited at that point. But if we're proactive, the world is our oyster. We can make a lot of things happen that are blocked off and we're kind of already behind the eight ball. So I definitely think that being proactive is going to be much better for people than being reactive.

Scott Geller:

Thank you, because that's everything I love. I love that being proactive. Again, that's the whole point of this podcast. So thank you for that, yeah, so tell us a little bit more podcast. So thank you for that, yeah, um. So tell us a little bit more. Um, if somebody wants to get in touch with you, chris, or maybe reach out to you, where can people find out more about?

Chris Way:

you? Oh, absolutely waylawcom. You can always go there. Um, but lately, uh I don't know if you can tell I like to talk. I have a lot of fun talking about business and law.

Chris Way:

Lately, iately, I have been doing a lot of LinkedIn and Instagram, just having fun kind of answering legal questions and thoughts and ideas that either I have during the day or that maybe I was talking to a friend or a colleague and they had some kind of generic question that a lawyer would never I would never bill somebody to answer that question. But I'm like, oh, this is actually something that might be really helpful for people to know. And so, yeah, I'll just kind of come up with a few thoughts about it. And, yeah, go, my LinkedIn, my Instagram, is Chris Waylaw, very easy to remember. But yeah, go, you can go see that it's a lot of fun stuff.

Chris Way:

I kind of goof around a little bit. I'm a naturally very silly person. So, yeah, those are the best places to kind of see me and what I'm doing. Yeah, later this month we will be launching a YouTube channel because that's going to give me a little room to explore some longer form content on these areas. That is also going to be Chris Waylaw. Yeah, that'll be launching end of this month, maybe early April. We'll give you a little bit of time to.

Scott Geller:

It's only a week away. I know Time is flying. Well, thanks, Chris, and I'll second the LinkedIn. I like seeing your posts come out. As I mentioned in the beginning, there was a really good one that helped kick us off. Well, Chris, thank you for coming on and thanks for being my first in-person at the Enzo Media Firm Studios here. These look great and I really appreciate you coming out.

Chris Way:

This is my pleasure. Thank you for having me. This is great.

Scott Geller:

Well, thank you everybody, and if you like the show, please text someone else and let them know and recommend that they take a listen. Thank you for listening and join us next time for Budget your Business.