Students in Professor Lipson’s Lawyering for Entrepreneurship (LE) class recently had the opportunity to pitch a panel of investors and alumni business lawyers in order to raise millions of simulated dollars. LE is an experiential course at Temple Law School developed by Professor Jonathan Lipson and Lex Nova attorney Matt Devine (LAW ’16) that seeks to incorporate theory and business-transactional practice by requiring students to work their way through four stages in the life of a startup: (i) formation; (ii) first financing (a convertible note purchase agreement); (iii) venture capital financing (preferred stock purchase agreement); and (iv) a strategic sale of the company’s assets.
The business plans pitched by the students were developed at the beginning of the course, with each student giving an “elevator pitch” on the first day of class for a business that they envision. After the class collectively votes on their favorite pitches, the winning students are designated as “founders” and CEOs of their respective companies. Students who do not become founders join the founders’ teams in a variety of other roles through a variety of other exercises.
The simulated pitch—held on April 1—was part of the third stage in their simulated companies’ lives, when teams of students pitched a panel of venture capital investors in order to raise capital through a preferred stock round (of course, no money actually changes hands). Student Brent Hackett pitched the startup “Virion Technologies,” a producer of point-of-care diagnostic devices, Paul Green pitched “Planet Music,” a chain of performance-based music education centers for children and teens, Jackie Dansak pitched “SweetSpot,” a parking solutions app for high-net-worth individuals, and Jordan Robbins pitched “JurisData,” a website that simplifies and aggregates online terms and conditions contracts so you can track how your data is being used.
This year’s pitch panel included Jessica Laderman (LAW ’19), Terence Noonan, Kim Perell, Richard Roskell, Greg Seltzer (LAW ’03), and Chris Yaracs (LAW ’15).
The panelists, and Professor Lipson and “Coach” Devine, were all impressed by the students’ performances. “This was probably the best set of pitches we’ve seen,” Devine observed later. “Which would be impressive at any time, but especially in COVID.”
The panelists also had advice and feedback for the students, some of which may be more generally applicable:
- Jessica Laderman, a corporate and transactional attorney at Ballard Spahr who counsels publicly traded and privately held companies on a broad spectrum of corporate law matters, cautioned students not to miss the “differentiating factor” that can distinguish their companies from “neighborhood mom and pop stores.”
- Terence Noonan, a nationally recognized television producer and actor, stressed the importance of developing a “human-interest” story that will connect the company’s product or service to their everyday consumers, inviting the students to consider, “how does it affect . . . a regular person that shops at CVS?”
- Kim Perell, a bestselling author, successful entrepreneur, and angel investor in over eighty startups who started her first company from her kitchen table, was impressed with the students’ pitches and specifically appreciated LE’s classroom component on women in business, telling the students “my job is to lift more women up and empower them to take a seat at the table and have an opinion because they have the experience and they have the knowledge.”
- Richard Roskell, a founder and Chief Strategy Officer for United Veterinary Care, reminded the students that the most effective lawyers are those with an ability to “minimize their [client’s] weaknesses,” and who “know their audience.” As Roskell explained, many startup founders have high expectations, but might be intimidated by the prospect of negotiating with sophisticated private-equity or venture capital investors.
- Greg Seltzer, a Partner at Ballard Spahr in Philadelphia and Chair of the firm’s Emerging Companies and Venture Capital Group, advised students not to neglect the ramifications of utilizing a business plan that relies on real estate leases in the current climate, explaining “if you’re doing brick and mortar . . . you’re in the real estate business.” Furthermore, Greg mentioned that any startups utilizing a brick-and-mortar approach in the age of social distancing should have a good justification for their in-person operations, “if anyone is doing anything brick and mortar right now, you need to explain to me why you’re doing brick and mortar and not virtual.”
- Chris Yaracs, an attorney at Royer Cooper in Philadelphia focusing on corporate & business transactions including startups and restructuring, warned the students about the legal troubles that might be associated with entrepreneurs who were involved in previous transactions and had to sign restrictive contracts like PIIAs (Proprietary Information and Invention Assignments), saying “there’s a lot of room to argue over those” and that a PIIA “could ultimately determine how involved you could be in scaling up a concept.” Yaracs also stressed the importance of scalability for early-stage companies in the accessible legal services space, “this is taking . . . a knowledge advantage and trying to scale that knowledge advantage.”
“This is probably one of the hardest classes in the upper level,” Professor Lipson observed later. “We ask these students to come in and try to see the world from the clients’ perspective while also learning how to plan, counsel, negotiate and document these deals.” “It’s a tough class, but they came through like champs, as they’ve done every year we’ve run it.”
Michael DiPietro (LAW ’21) is a proud
survivor graduate of Professor Lipson’s Lawyering for Entrepreneurship class, as are attorneys Laderman and Yaracs.