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Ep 73: All Things Contracts with Laura Frederick, CEO of How to Contract
44 Plays3 days ago
How do you avoid common mistakes in commercial contract negotiation? What about in drafting? And how can you get better at and find more joy in commercial contracting?
Join Laura Frederick, Founder and CEO of How to Contract, as she goes deep on all things contracts—everything from how to avoid common mistakes to tips for supercharging your negotiating skills.
Listen as Laura talks about her career in contracts working for top energy and renewable companies like Tesla and SolarCity, making the leap to start her own law firm and training business, establishing a yearly conference about all things contracts, and more.
Read detailed summary: https://www.spotdraft.com/podcast/episode-73
Topics:
Introduction: 0:00
Why Laura chose contracts as her core practice area: 5:52
Drafting contracts for energy and renewables: 10:17
Laura’s favorite types of deals: 13:54
Contract drafting tips and tricks: 15:39
Considering a more generalist role: 17:50
Common mistakes during contract drafting: 23:19
How to negotiate more effectively: 25:10
Tips for breaking a negotiating log jam: 27:59
Lessons from mentors: 33:03
Founding How to Contract: 36:39
Leaving Tesla to make the leap to business owner: 40:06
Focusing on mental health: 44:19
Finding Laura’s businesses online: 51:10
Rapid-fire questions: 54:08
What Laura wishes she’d known as a young lawyer: 55:12
Connect with us:
Laura Frederick - https://www.linkedin.com/in/laurafredericklaw/
Tyler Finn - https://www.linkedin.com/in/tylerhfinn
SpotDraft - https://www.linkedin.com/company/spotdraft
SpotDraft is a leading contract lifecycle management platform that solves your end-to-end contract management issues.
Visit https://www.spotdraft.com to learn more.
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Transcript
Common Contract Mistakes
00:00:00
Speaker
For me, the number one mistake I see more than anything, especially with people who don't have a lot of contract experience, is saying things multiple times. Saying things that are very similar, but saying them in different ways. So one of the first contracts I ever worked on as a you know new lawyer, the the partner gave me this contract and said, we want to terminate This contract they were a franchise or they want to determine a friend is he I was supposed to review the contract and advise and so when I looked through the contract I found three different places that talked about termination and each one was worded differently ah and I go to the partner and I'm like but it says it three different ways which one's the right way and the answer is nobody knows.
Laura Frederick Introduction
00:00:52
Speaker
How do you avoid common mistakes in commercial contract negotiation? What about in drafting? And how can you get better at and find more joy in commercial contracting? Today, we are joined on the abstract by Laura Frederick, founder and CEO of How to Contract.
00:01:15
Speaker
She helps lawyers and professionals master real world drafting and negotiation skills. She's also the host of ContractsCon, which is an annual in-person and virtual contract training extravaganza. I think that's my word. I don't know. In Las Vegas. Laura has more than 25 years of experience working on commercial contracts. This is really her passion. It's what she lives and breathes. She's worked on commercial legal teams at companies like Tesla and Solar City, a variety of other companies in the renewable energy space. We'll talk about that today. And she started her career at Morrison and Forster and K&L Gates working on, you guessed it, technology transactions.
Career Journey in Asia
00:02:01
Speaker
Laura, welcome to the podcast.
00:02:03
Speaker
So happy to be here. Thanks for having me. Okay. So I actually want to start today with a non-contracts-related question. I was looking at your background. I noticed that you when you were at MOFO early in your career, you spent some time working in Asia, ah in Hong Kong and Singapore, like living there and working there. I guess, like why did you want to practice in Asia? and Tell us about that experience. That seems so cool.
00:02:29
Speaker
It was. It was the coolest. so i was By that point, I was, I think, around a fourth-year lawyer. I was living in Austin. I loved Austin. I said I'd never leave Austin, but I wanted to go in-house, or I was actually looking for an in-house role in Austin. and I would get these recruiters, and none of them were great. This was in 1999, and it was I was one of the few technology lawyers who had this kind of experience at this time. So anyway, suddenly a call came from a recruiter that said, how about London? And I was like, oh, okay. I didn't have any kids. My husband at the time was very flexible, ah started talking and it ended up being Morrison Forrester. And ah through the conversations, I ended up getting an offer, but the plan was they wanted to send me to one of their foreign offices, but they first started at San Francisco.
00:03:20
Speaker
So I went to San Francisco work for nine months and then London wasn't the right fit. So they said, how about Hong Kong? And I said, sure. And so I went to Hong Kong. The craziest part was I went, when they sent me, I was already pregnant. I was ah due in, the I went there right around New Year's Eve and we arrived in New Year's Eve and I ended up having a baby in May. And I told, yeah, and I even said to Mofo, I was like, you know what, it's okay, we can wait. it's I don't have to go right away. they are They were just the most amazing firm and still are. They just said, no, no, we you know we and still need you there. So I moved to Hong Kong, had the baby in Hong Kong in May. And then
Transition to Contract Law
00:04:04
Speaker
um after a year there, they said, you know what, we really need someone with your skill set in Singapore. So they moved me down there. I worked there for about a year and a half and then moved back to the San Francisco office. um but
00:04:16
Speaker
It was just an amazing experience. I just really loved working overseas. I had been an exchange student in high school, done a semester in Broadway, in college, and even a summer program in law school. So I've always had that interest in international and it was really the opportunity of a lifetime and and has shaped a lot of how i how I live, just with a better connection to people around the world um from having that experience.
00:04:44
Speaker
Absolutely. I mean, I'm sure it also also teaches you to think about doing business with different people from different places with totally different backgrounds, right in in a new way. I mean, I spend a lot of time working with folks in Asia and I had a little bit of experience with Europe and it just it teaches you to I think be a little more open minded and give people the benefit of the doubt and question like the way that you've always done things may not be the right way in every circumstance.
00:05:13
Speaker
Exactly, exactly. Yeah. And I think accepting what I'd say is for me, it was also learning to appreciate that what they're bringing to the conversation instead of it just being about me. And so even in contracts,
00:05:29
Speaker
you know, I have my way I want things done. um If I'm negotiating with other US lawyers, most of the time we're generally in the same area in terms of approach. But when sometimes when I negotiate with counterparties overseas or get their form contracts, it's just such a different approach. And you're right, it's that open mindedness and learning to appreciate different approaches. So when in your career did you feel like you really started to work with contracts? And what do you think it was that drew you in to focus on that sort of practice area? like Did you explore other areas first? Tell us a little bit about
The Appeal of Contract Law
00:06:08
Speaker
that. Sure. So I actually my first job out of law school was with a franchise firm. I had I had come out of law school as you can tell from me talking about the international experience. and That was my passion. I was international economics undergrad.
00:06:24
Speaker
I wanted to do something international. The only job I could find at a law school that had anything international was a ah firm that had both US and international franchise clients. So I did that for about two years before I moved to check transactions. Doing the franchise work, it was a combination of regulatory, compliance, disclosures.
00:06:46
Speaker
and contracts. I hated the regulatory compliance. There were too many rules. They didn't make sense. They weren't intuitive. it was There was no creativity, or at least you know to my young first year lawyer perspective, it didn't have that. But the contract side was just so challenging.
00:07:07
Speaker
I remember working on my first contract and it was, I had no clue. I thought, here I am, I'm you know a graduate of college, I'm a humanities major, I can write 50 pages you know in a couple hours if needed. And here I was having so much trouble just constructing a simple sentence that could fit in a contract.
00:07:28
Speaker
And i I loved that challenge. And then I also love the flexibility of it, that it's really a business document. It always has been. And when you're doing these commercial contracts, it's not for you're not aiming for perfection. You're aiming for reasonable protection of risks. And if there's a typo here, typo there in your normal day-to-day contract, as long as it's not a big material, meaningful mistake, it's probably fine.
00:07:57
Speaker
And I always like that. I think it it makes it more, I can enjoy it more when I'm not so stressed out all the time that I'm going to make one little mistake. Sure. So, and maybe that's, you know, not the best thing to admit, but it's, I just love the flexibility about it. I love how it's a business document. I love the strategy. I love the words and learning how to write the language and speak the language of contracts.
00:08:23
Speaker
and then use that knowledge to help my clients and achieve their outcomes. So I just think they're the best.
Communicating with Non-Legal Teams
00:08:30
Speaker
Yeah. I mean, you strike me as someone who's very focused on, and not just because you're a founder, but very focused on business outcomes and you understand, I think, you know, i Oftentimes, actually, the not lawyers, that the business development people or the product people. ah ah That's a hugely important input, I think, to the contracting process because they're the ones who are trying to drive some sort of business outcome and the contract is the thing that makes it makes it possible.
00:08:55
Speaker
Yeah, no, absolutely. And that was one of the things I always did well with, which was talking with business teams, product team, engineers, quality teams, logistics teams, flight chain teams. Because I talk like a regular person, or at least that's what I think of myself. And people have said that to me. I sound like an ordinary person. i don't I've never had that kind of polished way of speaking.
00:09:22
Speaker
and I always saw that as a detriment that you know I wasn't as good as the other lawyers because I couldn't sound amazing on demand. I was so intimidated by those lawyers who would just open their mouths and it would be beautiful language coming out. and Here I am like, yeah, it's totally sucks that we got to do this. but you know let's admit so I have this informality about me that I had even when I was doing mega deals,
00:09:51
Speaker
But I think it works really well in terms of putting the business people at ease, putting my counterparties at ease. And I think sometimes, you know especially before people knew who I was, I could fly under the radar a little bit more because they'd hear me talk and think, oh, she's not too threatening.
Energy and Renewables Sector
00:10:09
Speaker
She's not going to get the better of us. And you know I'd sneak in and and do my my deal.
00:10:17
Speaker
Once upon a time, you're a Tesla secret weapon or something like that. I do want to talk about that. So you spent quite a bit of your career in the energy renewables space. How'd you get into that and and what's it like to work on contracts in in that space?
00:10:34
Speaker
Yeah, i I fell into it. I had worked in law firms for about nine years, you know, some franchise in the beginning, then tech transactions, and worked on every single industry there was. It didn't, I think, really end everything. Whatever it was that came through the door, we worked on. And then when I wanted to go in house, I had, this was when I had a three year old, a one year old, and I was pregnant again. And I'm like, okay, I need a nine to five job. I need a job where I can go home and not work. And the job I found, which was a little bit by accident, because I was looking more for the lifestyle than the exact industry. And it was this big energy, ah diversified energy company.
00:11:13
Speaker
out of Pennsylvania called PPL. And I was going to be in charge of supply chain. And I told people, I'm retiring. I'm just going to work nine to five. I'm getting out of the rat race. And ended up, I just loved it because I started and I was you know as a ninth year lawyer where we know everything.
00:11:34
Speaker
We're so smart. you know We've been there. I've been working in big law firms on mega deals over the worldwide deals for a long time. I thought I knew everything. and I get here and I had to really start from scratch because the way contracting works in the energy space is very, very different.
00:11:51
Speaker
um from how contracts work in other spaces because we had the regulatory overlay with the energy the state and federal level then we had even back then because this was in the mid 2000s that ah We didn't have energy storage like we do now so they sent me to an electricity 101 class when I first started that they put on for people who were new to this energy industry and I had no
Understanding Contracts Deeply
00:12:18
Speaker
idea at the time that energy couldn't be stored like What? What do you think you don't think of unless you're in space, right? Yeah. And back then it was, you know, energy wasn't as, you know, it wasn't as much of a cutting edge field as it is now. It was just you have utilities and they have generation with nuclear coal or oil or whatever it is.
00:12:40
Speaker
so yeah i just loved i got to learn everything about energy and then the stuff i worked on was everything from naming rights to a ah soccer stadium that the company bought to buying uranium for the nuclear plant to trading derivatives through the 2008 bust with Lehman on as counterparties and companies like that doing these financial derivative contracts. So it was such a great experience to get so many different kinds of contracts. And I think it really propelled me forward in terms of my career, because once you touch every single kind of conjure i had campaign company contract, contracts. So once you do everything in that whole gamut, you see all the ways they kind of
00:13:25
Speaker
feed into each other, that concepts in one, like some of the ways I approached the financial derivative contracts and learned how those work really helped me do technology licensing contracts. And the propane company helped me do really, you know, the 100 million master services agreements. So um I think the experience of working in renewables was I loved it for the diversity of subjects, the complexity, and just and really still love it. It's my favorite area. what um i mean as As you're pointing out, right i mean commercial contracting is an extremely sort of broad term and encompasses all sorts of different types of deals or transactions. What are your favorite types of deals to to work on? what do you What do you get most excited about? I love really large equipment and manufacturing contracts. So my, I have my super niche thing. And for a while, I think I was in the top probably 10 to 20 lawyers in the country who did this kind of work. Cause when I was at solar city and then at Tesla, I was doing a lot of really, really big deals and did a lot even before that I was at a solar module company called Hanwha Q cells.
00:14:34
Speaker
And so um it's buying those the like solar modules or buying all the equipment. You have a $700 million dollars renewable energy project getting built, and I'd be the one buying all the equipment for that project. And so I really, really love those. Again, because it's the intricacy. these The way those projects, the equipment works, and especially at that scale and dollar value,
00:15:02
Speaker
A little mistake you know has huge repercussions. So it was interesting. I had to understand, for example, a solar module starts to degrade as soon as you open the box. And so we had to ah we had to be careful to tie our warranties to when the box was open, not when they were delivered.
00:15:23
Speaker
ah Things like that, like lots of little nuances that once I had learned the industry, I could apply those and help my client by using that knowledge to protect them. so yeah it's It's just a real fascinating area.
00:15:38
Speaker
that's interesting so besides maybe being like super detail oriented. Is there advice that you give folks on how to do deals like that and do it well? right i mean Let's assume that I haven't been in the industry for 15 years and so I haven't seen it over and over and over again. I'm just using that as an example. right we don't have to i'm I'm just curious if there are like broader lessons for how to how to contract in that way and and do it really well.
00:16:05
Speaker
Yeah.
Specializing in Contracts
00:16:06
Speaker
For me, I think it's what my advice I give people is to really dive deep. not you know You have to dive deep on the legal concepts. You have to understand warranty through and through. You have to understand how indemnities work through and through. Not just the superficial level, how others are negotiating it with you, but really, really understand it.
00:16:26
Speaker
But that's only part of the picture. The other part of the picture is you really do have to understand the operational elements of how what's your contracts so how it works or how the subject matter of your contract works. So for me, whether it was solar module, energy storage, technical services, you know I look on a piece of paper, oh, the you know vendor will provide services. well What exactly? Oh, well, they're gonna go in and they're gonna tweak this little screw. Okay, so what happens if that screw doesn't get tweaked? Do we have another screw sitting there? You know, if they mess it up, can we go do that? How much would it cost to find somebody else to to turn that screw?
00:17:05
Speaker
So your brain has to be kind of on turbocharged, thinking about all the things that could go wrong, but you can't do that unless you really, really, really understand those the the business and the technology and the operational elements of it. So that's what I always tell people to focus on. You know you have to understand the law and the contracts, but what our I see lawyers fall short is when they don't really get that operational insight. um And those are the lawyers that you know They do a decent job, but they'll never be able to protect their client as well as those that really, really understand the operations.
00:17:44
Speaker
So like really pull on the thread, basically. That's that's great advice. i mean Your passion for contracts is so evident. I guess I'm curious if there was ever a point in time ah during your career in-house where you thought about like taking on a more generalist role. Or if you were like, no, this is this is the thing that I love and and I want to just do this forever and always.
00:18:07
Speaker
Yeah, it was kind of like that. At some point in my career, in my in-house career, I was, you know, kind of, I always loved doing my supply chain work and my sales work. I loved doing all the commercial stuff. And I thought, well, to advance, I need to become a general counsel. That's every lawyer's goal in life, in-house lawyer.
00:18:29
Speaker
is to become a general counsel. And I remember I went and interviewed for a couple of roles and I was being considered because I had this experience and mostly I was looking for places where a lot of the job was going to be commercial contracts. And so I interviewed for one and we started talking about the job and they were saying, yeah, you'll be in charge of these corporate, you know, some of our financial things and we've got the HR things. And I remember I can even feel that moment of like, ew, I don't want to I'm like, what?
Finding Fulfillment in Specialization
00:18:59
Speaker
And that's what I realized, even though a lot of people dream of being a general counsel, it was not my dream. Like, why would I give up doing what I love every day, all day, basically, to doing what I love only a small part of the time? And so that's when I kind of said, you know what, I'm sticking with contracts. That's my path.
00:19:18
Speaker
That's what I'm going to do. I'm just going to keep learning, getting better, you know and just enjoy the fact that I'm one of the few who absolutely loves my job every day. i Maybe there's conflict and there's issues in different jobs and things like that, but i've never i haven't I don't think I've ever not loved working with contracts.
00:19:38
Speaker
Yeah, I will say, I mean, I have a lot of people on and you are, you're now, especially as a founder, and we'll talk about that in just a minute. I mean, you are a generalist in some ways, right? I mean, you're right. well not and because I'm one of those lawyer founders, we're not really business people, you know, or there are some, but I'm not really a business person. I'm still the lawyer. It's just I happen to be business, but you know, it's I'm not very good at the business side. of What I was going to say is i mean I have a lot of guests on who are GCs or generalists or have even gone on and like they decide, okay, I want to go even well beyond legal and be a COO or help run strategy. or But i I think that it also is important to highlight voices like yours that have specialized and in some way and have found real sort of like happiness and meaning and enjoy that and know who you are. right i mean That's really the goal is like know who you are and know what makes you tick as opposed to try to drive towards anything that everyone says you should do. Where do you think your passion for commercial your very evident passion for commercial contracts comes from?
00:20:55
Speaker
you know I I just indulge in myself in it. it's so yeah I was always thought it was interesting and I like the strategy and I like the words and I like the relationships with my clients and the you know the way that we're working with a counterparty to achieve a business outcome in a relationship. We're not there because we hate each other and we're trying to settle make you know settle some dispute. yeah so I love that part of it. that nobody's generally forced to do these deals, that the businesses are choosing to do these deals together. So it's it's a nicer environment generally, um when you're negotiating these kinds of contracts than those who are litigators or in the middle of other conflicts. so But yeah, I think at the end, it's it's I'm really driven by service. I was raised in a family that was very service oriented. And I love helping my clients, whoever they are.
00:21:53
Speaker
And it often, there are people who want to do right by the company, they want to get protect the company, get a great deal, but they might not have all the skill sets to do it. And so when I come in, I'm there to help them. And there's so much joy and fun in that. But I also get to play the games with the words, you know, like, okay, But let me, if I tweak this word a little bit here, it's a little bit better for my client, even though in the in the grand scheme, it's so unlikely that that little tweak will make any difference whatsoever. But I get paid to play that little game of how do I tweak my words to make it better for my client so if there ever is a problem, they'll be protected. So I'm not quite sure where it came from, but from the beginning,
00:22:40
Speaker
I loved it. I actually talked to my one of my mentors, I was talking about when I was a young associate, and he said, you know, sometimes I would be annoying to the other associates because they would be so focused on what the rules were and what we should say. And they're like, you know, she's going on and on. and But he said to me, he said, but you were right. So You know, I have to be careful there not to be too annoying on this stuff. So I i hopefully learn how not to be as annoying as I get older. But yeah, I think it's it's that fun of learning the rules inside out and then being able to use them for your advantage. Let's talk about like some tips and tricks that you've picked up over the course of of your career. Just to start with, are there common mistakes that you see on the drafting side of commercial contracts?
Contract Drafting Mistakes
00:23:32
Speaker
Yeah, I think for me, the number one mistake I see more than anything, especially with people who don't have a lot of contract experience, is saying things multiple times. Saying things that are very similar, but saying them in different ways. So one of the first contracts I ever worked on as a you know, new lawyer, the partner gave me this contract and said, we want to terminate this contract. They were a franchisor. They wanted to terminate a franchisee. I was supposed to review the contract and advise. And so when I looked through the contract, I found three different places that talked about termination and each one was worded differently. And I go to the partner and I'm like, it says it three different ways, which one's the right way? And the answer is nobody knows.
00:24:15
Speaker
You know, you go to the court, you make arguments, but basically now this franchisor didn't have any predictability about what it could do with a counterparty because you didn't know which ah of those applied. And it was kind of a great lesson and I see it play out over and over because one in my role as commercial lawyer, I also was kind of the first person to deal with disagreements with the counterparty if there was a problem.
00:24:41
Speaker
Before anybody was filing lawsuits way before all that when we're just starting to work it out and those that was the most common problem we had was the language wasn't clear and often it wasn't just being vague it was saying similar things multiple times in different ways and to me the worst thing you can
Effective Negotiation Strategies
00:25:00
Speaker
do.
00:25:00
Speaker
that's great advice or the advice that comes out of that which is say things in plain english and don't say them over and over because they may conflict with each other i mean that's fantastic how about on the negotiating side ah how do you coach people to negotiate more effectively.
00:25:18
Speaker
Yeah, for me, it's really making sure you understand what your risks are, you have to start with a contract is a tool of risk management. And what you can if you just pick the approaches that some negotiation guru or contractor says to do.
00:25:36
Speaker
focus on indemnity, focus on limits of liability. Yes, but what I see, the mistake I see people make is they're so overly focused on those. They totally miss the bigger risks that exist in other provisions.
00:25:51
Speaker
And they won't get the right intellectual property rights. They won't have clear payment terms. And those things are what really drive, you know, indemnity is certainly in an extreme case is a big risk. But over my career, you know, working 25 years, I very rarely thought indemnity come and play out.
00:26:15
Speaker
on a weekly basis, we had payment disputes, we had operational disputes, we had IP disputes, and not huge IP infringement lawsuits, but like, wait, you're not supposed to be using that. Oh, wait a second, I own that, not you. So we had a lot of those things, they come up at the operational level, and those are so critical. So one of the things I always say to people is focus on your risks first. And then the second thing is really focus on how much bargaining power you have.
00:26:43
Speaker
I call it negotiation currency and treat it like you're on a budget. So if you're the little guy and you're negotiating against the big gorilla, you have a very tiny negotiation budget. You're not going to get much of anything. So you have to really carefully spend what leverage you have. And in advance of showing up at that negotiation, you're thinking about Okay, I'm only gonna be able to get a couple things. one am i What's most important? What am I gonna fight for? Versus if you're the big gorilla or you know, even if you're too big gorilla isn't an issue with each other, maybe you have even leverage. So then you're thinking, okay, these are the things I want the most that are most important. So
00:27:25
Speaker
I'm going to budget more for a limitation liability, payment terms, termination for convenience, thinking about what I need and pre-planning how you're going to spend your leverage in that negotiation. That's something I think we all should be doing. Again, it all ties back to that operational risk I was talking about before. You can't assess risk in the operations unless you understand what goes wrong with this kind of business. It all ties back together. I love that. I love that phrase about currency, negotiating currency. That's a great way to think about it. Here's a question for you. I mean, a lot of times in a contract negotiation, well, sometimes there's a there's a log jam, right? Or there's an impasse or, and I'm sure that you've encountered this many, many dozens or hundreds of times over the course of your career. Do you have like tips or ideas, strategies that you feel like work well for breaking that sort of log jam or getting to a better conclusion.
Resolving Negotiation Impasses
00:28:25
Speaker
Yeah. So I would say the mistake I see people make is they try and push through it. They try and just use a ram and push as hard as they can and beat the other side down until they concede. And it it creates antagonistic you know feelings. create resentment It It has a lot of negative repercussions when you're negotiating that hard to push through a log jam.
00:28:52
Speaker
So the techniques I prefer, if it depends on what the kind of deal it is and where you are in the deal. If you're still in kind of the middle of it, you're still getting through 50 different issues, you're trying to negotiate in this contract, I always just put it to the side. If we don't agree on it quickly, I immediately move it to the side so we can focus on all the things we can agree on.
00:29:14
Speaker
And that way, we let's say there's 50 issues when you started to know and your negotiation. You hit a log jam on five of them, but you were able to work through all the other ones. Then you'll come back to that short list. And what happens, and I can tell you after looking back on my career with, I would guess 10,000 plus contracts I've probably worked on, the end moment typically is a horse trade. Typically, each side is looking at what's left.
00:29:41
Speaker
The senior executives who are making the call are basically like, tell you what, I'll take these two, you take those three. you know It's sort of like they make that call because there's only five things left and then they can make an assessment of what's most important for them at that moment. It doesn't always work out that way, but it often does. And by putting those really difficult issues aside, you're preserving goodwill, you're preserving momentum,
00:30:07
Speaker
You're making sure the parties who, again, this is the start of a long marriage together, you're making sure that they're going into it without creating that level of conflict that will have long standing results.
00:30:20
Speaker
Cause also I find with those log jams, if you push too hard during negotiations, it really does. And I've seen it ah even on my side of the deal, it can create people who just put up artificial walls um and artificial barriers. So I've had that happen so many times where I'm working with a business person. We have the freedom to concede these things. huh And because the other side pushed so hard and was we're being jerks. Yeah. they My side doesn't. Even though they could easily give everything away and it wouldn't be a problem, they choose not to because the jerk's on the other side. So in this kind of commercial world I work in, that's an important part of it is being, you know, keeping it professional, keeping it nice. And and if you try too hard to run through log jams, my experience is it it always comes back to bite you.
Efficient Contract Management
00:31:13
Speaker
Hey there, legal teams! Big news! Spotgrass Fall release is here, and it's our biggest update yet. With over 15 new features, it's packed with tools to make contracting faster and simpler for you.
00:31:27
Speaker
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00:31:55
Speaker
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00:32:24
Speaker
Now let's get back to the podcast.
00:32:29
Speaker
And I mean, it will also sort of color the business relationship as you're saying on an ongoing basis, right? I mean, you want the conclusion of the contract to be an exciting moment for both businesses, not, ah okay, we got through that and now we hate each other. And now we have to work together for, you know, many, and I think most people, most people see this and understand this when they're negotiating like their salaries and a new job. and yeah mean that's like that's it's ah It's an easy corollary, I think, for people to understand there. Even though you've given us some rules, i mean I do feel like negotiating is a little more art than science. Are there good lessons or is there a great lesson that you picked up from a colleague or a mentor around negotiation during your career? Yeah, I think the one I'd say, and I use this, and it's not exactly negotiation, but it it it relates, which is A level effort for A level work, C level effort for C level work. And that was something um one of my mentors early on said, and it it always stuck with me, especially for commercial contracts, because we deal with so much
00:33:44
Speaker
minutia and so many little 5,000, 10,000, 25,000 deals. And when you're negotiating those kinds of deals, you have to remember what's important. And it doesn't matter. you know You're not going to get all the provisions and you shouldn't be spending all your time negotiating those. It just doesn't make sense from a risk management standpoint.
00:34:07
Speaker
so Keeping an eye on how important is the deal, whether you should even be worrying about it at all, whether even lawyers should be looking at those deals at all, is something that something I learned early from my mentors and always applied. And again, especially in commercial contracts, more so I think than most other legal practice areas.
00:34:29
Speaker
One of the things that I see now as ah as a follow-up to that point is I talked to GCs who they've just decided for risk-related reasons or for bandwidth reasons on their legal team, usually some combination of the two, that there may just be some contracts that they just don't negotiate. like They full stop say, we don't negotiate NDAs. We'll sign anybody's paper. It's OK. This is not going to create a problem for us. I'm curious what you think about that approach.
00:34:59
Speaker
Yeah, I love it. I think it's fantastic in the right setting with the right person making that call. And it has to be somebody who appreciates the risk of taking that approach. And especially if it's an executive, a CEO, a general counsel who's making that call, that's a perfectly reasonable call to make. I think the thing that we watch out for, and as a lawyer, when I work with people who make that call, is we identify when does that rule not apply. So for example, I have some clients who work with a lot of trade secrets.
00:35:35
Speaker
And for them, the terms of the NDA are everything because trade secrets are really only protected with counterparties if you have that NDA in place. And having a ah terrible NDA can jeopardize the value of the company and yeah because their assets are their trade secrets.
00:35:53
Speaker
If that's the case, then we're going to take a very different approach. um But that's only for technology and transactions that involve those trade secrets. If it's just, we're going to hire someone to water the plants, sign the NDA all day long, who cares? um Same with the little services agreement. It's not really going to matter.
Founding How to Contract
00:36:15
Speaker
But knowing when to apply those kinds of rules and when not to,
00:36:18
Speaker
And I think it's perfectly fine for a lot of companies to have it across the board. And I love the companies that just say we used, you know, bond terms, NDA, we use one NDA or one a common paper. And I always just sign those unless there's something special about the kind the deal. I think you can usually just sign those and be fine. So you have all this contracting experience. Tell us the origin story of how to contract. How did you get started?
00:36:47
Speaker
Yeah, I'd say it goes all the way back to when I was learning contracts. And i was it really was driven by anxiety and fear. Because when I was an associate and I'm you know getting paid a bunch of money per hour by clients who expect me to know what I'm talking about, I was always trying to learn more. And whenever I had good content,
00:37:11
Speaker
Training some checklist some description some good provision. I actually started my own personal playbook I think I was a third-year lawyer and I would over my career would collect all those good insights that I could find but throughout the career I was looking for that good training.
00:37:30
Speaker
Not the superficial, you know think like the business. yeah you know There's a lot of that. and Even with contracts, most of the training was very you know nuanced or niche. so This ah very narrow type of contract. so They'll have a CLE on a software license with AI, for example. That would be something now.
00:37:54
Speaker
But where's the basic indemnification ceiling you know it just they didn't they wouldn't do that so it was always frustrating for me i really struggled to find training and the work that i did every day cuz i didn't want the niche stuff i wanted the core stuff to make me better and better and learn new issues and get better at those things.
00:38:13
Speaker
So anyway, I go through my whole career looking and never finding. um And later in my career, I've discovered I really love training and the teams I worked with really, you know, told me that I was very good at training. And so after I launched my own law firm in 2019, I quit Tesla and put up my shingle.
00:38:33
Speaker
And I'd been doing that for about a year and a half. And I thought, oh, I should start doing some training on the side. And um i started posting it kind of started when I started posting contract tips on LinkedIn. And people just had great feedback. They got involved in the conversation. And I thought, I should turn this into a business. And I should do training. And I'll do a membership. And I'll offer courses. And it all kind of started that way. It was almost like it wasn't the plan to begin with.
00:39:03
Speaker
But then once I saw the need and how that same need I had grown up in my legal career with was still there, and honestly, it is even today is still there, um that I was like, well, i'm at this point in my career, i'm you know when I started a couple of years ago, I was 53 or so, I've reached my pinnacle. I have a lot to give back. And I didn't want to just let all this knowledge kind of leave the profession with me. So that was part of it, too, was kind of collecting everything I knew while I knew it before I could forget everything and sharing it with the world in a way that would help people. So some was business, sure, and I'm all about making money, but it Really, a huge component of this and why I give away so much for free is because that's it's really just about helping people feel better, be able to do their jobs better and succeed in their life without having to pay me something to make that
From Tesla to Entrepreneurship
00:40:05
Speaker
happen. Yeah. When you were leaving Tesla, to just before sort of how the contract came about and starting your your solo firm, your solo practice, and which you still have. ah i don't know was that like Was it scary to make that leap? like How did you yeah how'd you how you go for it? yeah It was really one of the hardest things, one of the scariest things I've done. um Because at the time, in terms of context, so I was working at Tesla, you know I got my salary, I got my benefits, all that sort of stuff. i'm the sole you know I've had my kids in sole custody of my kids with no contact with their dad since 2014. So at this point, I already had that for five years and I didn't have any family around. So it's just me taking care of my kids and my I'm the only one paying the bills. And so I'm not married or there's nothing like that. So all of a sudden I'm getting like, why would I leave this job where I have a salary
00:41:01
Speaker
you know But what I came to, this was a point in my life where I and and i talk about mental health stuff a lot and um that I had gone through a massive amount of therapy already. And I knew that you know to trust myself.
00:41:16
Speaker
that I could make those calls. and I also knew that I spent my career afraid of being fired on any given day. and That idea that a job is safety is really, in a lot of ways, false for many people. you know it's You're safe only as long as they want to keep you around. and by creating my By learning how to make money ah through my own farm, I would actually be much safer.
00:41:43
Speaker
um So I came up with a game plan. I said, you know, I've got, I think at the time I had eight months of saving the bank, ah other than my retirement account. And I said, you know what, if I hit five months and I'm not making money, I'll just go find another job.
00:41:59
Speaker
you know, call one of the placement firms and I'll just get placed. But pretty quickly, you know, I saw that I could make at least as much as I made when I was at Tesla and cover all my bills, no problem. And then over the course of the next year or so really learned how to sell my services, price my services, find clients, do all that kind of stuff. And I realized like now I'm really secure.
00:42:24
Speaker
because I don't just have one company that's paying my bills. I have lots of different companies. If one goes away, I can go find another. And there's so much security and power in that feeling that you know you're really not dependent on any one company wanting to hire you and keep you
Leveraging LinkedIn for Growth
00:42:43
Speaker
employed. And now you have this amazing feedback loop almost with your how to contract business as well. I mean, talk about an amazing business development tool at your disposal.
00:42:54
Speaker
Yeah. Well, I'll say when I started, because I have, you know, the benefit of opening my law practice after I'd been practicing, I think at that point it was 21 years. I forgot how many years I was um back in 2019. So yeah, like, oh, 23 years or so I'd already practiced law. And so I knew everybody and they knew me from all my in-house jobs and my law firm jobs. So I had a pretty good, you know, collection of of contacts that I could reach out for and who would give me work. So I think I looked at it later on. The first 18 months of my law firm, it was like 97% of the clients I got were either former coworkers or former coworkers who referred somebody else to me. And then once I started posting on LinkedIn every day, the 18 months that followed, it was the opposite. It was like 95% of my new clients were from my posts online. and Wow.
00:43:48
Speaker
I had so much work. I actually ended up hiring, I had four contractor attorneys working with me ah at one point know that year. It grew so fast because there's something about posting every day online and connecting with people every day on on LinkedIn, especially then during the pandemic that it just, and showing that I knew what I was talking about when it came to contracts. I think that just powered that um familiarity people had with me and their comfort in sending me their contract work.
Importance of Mental Health
00:44:18
Speaker
That's great. Laura, before we before we wrap up, um I didn't know you were going to mention it, but you mentioned mental health. And I think that that is an area that folks in legal and legal adjacent roles, I think it's something that we need to focus on more. And so I just want to give you the opportunity if you have any advice that you'd like to share with with the audience. I would certainly love to love to hear it too.
00:44:45
Speaker
Yeah, it's it's an area that's so important to me. and i didn't you know i tell people i I got my first therapist at 42. I didn't realize that I could change some of the ways that I approached, some of the ways that I processed and dealt with life. And I didn't realize what a positive impact going through therapy would have on every aspect of my life.
00:45:09
Speaker
And so before I started with therapy, I very much felt like the victim. I felt like my life had turned into this place, and I'd reached this point, and it wasn't my fault. I didn't do anything to make it happen, at least when it came to my personal life. My professional life, I felt in control. I have chosen these jobs. I've chosen this path. This is what I want to do. I'm where I deserve to be.
00:45:34
Speaker
But on the personal side, it was like, oh, it's happening to me. I'm the victim. I don't know how to get out of this. And I didn't see how I had created all the circumstances. I had created a situation where I found myself in a failing marriage and just being unhappy.
00:45:53
Speaker
and really unable to cope with the difficulties of life. And it was through therapy that I found how my thinking contributed to that and that I won was i wasn't seeing the role that I had. For example, the idea of owning your outcomes.
00:46:11
Speaker
and owning where you are in life and that where none of us are victim, we're all making choices about where to be in life. And just even though we feel like we can't make a different choice, we are making a choice even when we're not making that choice. you know You're choosing to stay in your circumstances. And I think the other the other big thing, which I think lawyers really struggle with, and I did as well, which was this idea of I can control the world around me if I just do enough work.
00:46:38
Speaker
And I tell people what to do and I set everything up so it won't fail, then it'll all be good. And anytime things go wrong, it's because I didn't prepare properly. I didn't you know do these things. and And I had this sense like I knew what was best for everything that was going on in my world, the people around me, all that kind of stuff. And I had this great therapist who said, you know she's like, who are you, God? How do you know what's best for these people in your life? You have no idea. Maybe you are exactly the thing that's causing all the problems in your life. And if you would let go of you're trying to control everything,
00:47:18
Speaker
then they would, these other people would be better off. And I just was like floored by that because it really challenged the sense of me trying to control everything. And it goes back. There's a great quote on it that you you didn't have control. I forgot. I have to, I don't remember the exact wording, but essentially it's, yeah it's, you'd never had control. You only had anxiety. um And that false sense of control, especially lawyers and people in the legal world, create for ourselves because we're overachiever types and we're used to making things happen. And we're used to being the smart one in the room and telling everybody what to do. So it's hard to kind of take that
00:47:58
Speaker
version of ourselves that doesn't know what's going on and isn't in control and is just all we can control is ourselves. So I think embracing that and again my number one career advice for everyone is get therapy early and often it will my career Like the joy in my career, my ability to to do a great job went through the the roof once I got my therapy. I learned how to manage my emotions so much better. I learned how to really, you know, embrace the role as opposed to, you know, being scared all the time, being worried and and stressed all
Impact of Therapy
00:48:40
Speaker
the time. I just, I found so much more peace once I went through my therapy. So
00:48:44
Speaker
I can't talk about it enough. I would i would second that. ah Well, like a lot of what you said there really resonates. um And I'm sure it resonates with people who are listening too. you know I mean, I've seen a therapist a few times in my life um and I started seeing a new one earlier this year and it's been really productive and I've noticed you know, not just in my personal life, but just in my whole life broadly, including my professional life, things are better as a result of the sort of guidance and sounding board that I have. So I think that a lot of people maybe struggle with the first step, which is like going and finding the therapist or asking for help or telling their partner or their family that they want to go see a therapist, right? um Yeah.
00:49:31
Speaker
Well, I think it's a little bit it's almost like it's um it's selfish, you know especially when you have ah a spouse, you have children, you have a job. You don't want to have free time to go see a therapist. like In a million years, I wouldn't have been open to it as an associate in big law even before I had kids because I was working 60, 70 hours a week. why When am I supposed to see a therapist?
00:49:54
Speaker
but What I realized is, you know, I should have skipped lunch some days to see the therapist. I should have, you know, not slept in one day to see the therapist. Like, you can find that hour a week. You can. And this idea that you're too busy It's because you're on this mouse wheel and you're trying to keep the mouse wheel going, but there's another way. You can actually, if with the therapist, you can figure out how to step off the mouse wheel and you know really create a life that you want for yourself and not just that keep running as fast as you
Celebrating Contracts at ContractsCon
00:50:29
Speaker
can.
00:50:29
Speaker
I would say if this topic is interesting to our listen like to someone who's out there who's listening, I did another episode with Jasmine Singh, who is the GC at a company called Binti. And she talked a lot about how earlier in her career, she actually quit Big Law and became a spin instructor and had no plans to go back. And eventually, she found her way back to the law in a much happier way. um But I think that this is this is a topic that isn't talked about enough. I'm glad that you brought it up. I would encourage folks to listen to that episode as well. Okay, Laura, if folks want to learn more about all that you do, about how to contract, they want to attend ContractsCon, where can they go to find out?
00:51:12
Speaker
yeah The best places go to howtocontract.com. That's my main website. and You can learn a lot there. For contracts con, it's ah contractscon dot.com. But the easiest way to find me is really on LinkedIn. I still post a contract tip every weekday.
00:51:29
Speaker
and do a lot of other posting as well. So that's the best way um and encourage people who want to come to contracts con. I say, you know, I do call it the extravaganza because we are the only legal conference or legal conference, I think where the speakers wear costumes.
00:51:47
Speaker
Um, I don't think there's anybody else that I didn't know if that was in my script or if that was your word, that was yeah that's my word because that's what it is. Like we didn't, when I kind of, I had the idea of contracts con, it was really a celebration of contracts and not just sitting around playing banjos. wow but really just for people who love contracts so one of my favorite quotes is one of the people who attended in the past she said i've never been in a room where everyone was as excited to talk about indemnification as i was and it's so true like the nerd level at contracts con is off the chart.
00:52:25
Speaker
with between the speakers in their costumes and then the people who kind of self choose to attend. So those know-it-alls, those kind of the jerk lawyers, they're never going to go to something like this. um And so it tends to be people at all levels. it's it's We really focus on advanced training, but newer lawyers are welcome. We have a lot of contract professionals come.
00:52:48
Speaker
And it's really just indulging in, you know, day to day contract training on the core stuff we do all the time. So I hope people have come. You can join virtually or in person, but the in person experience can't be matched. It's just a whole different vibe. And extravaganza for contracts nerds. Exactly. Exactly. Where we find our place, you know, a lot of us don't necessarily feel at home and the, I don't know, a lot of the legal conferences, I always had this issue where you walk in and people immediately look at your badge to see if you're worth talking to or, you know, it's, everyone's talking to each other. They seem like they know everybody and you don't know anybody and it's a whole awkward and,
00:53:30
Speaker
So a lot of what I do with contracts con is devised to create connections. So we do small, everybody sits at a small table and a different one day, one day, two, they have practice exercises they work on together at that small table. And then day two, we switch them around to different tables so that they get to meet more people. And it's very um egalitarian. So we have partners, big law, sitting with contract managers from a small company. And everybody's working on the same problem together and helping each other. And you know it's just a very collaborative place and very supportive of of different people.
Embracing Life's Uncertainties
00:54:07
Speaker
That's fantastic. I've got a couple of fun questions for you now if we start to wrap up. I think they're fun. yeah The first one is ah what your favorite part of your day today is.
00:54:21
Speaker
you know I'll say these days, it's creating graphics. I had no idea that I would enjoy graphic design so much. like Even actually before today, because I own my business, I do all my own graphic design, and on my website, I create all the banners, I do all that stuff. Honestly, I could even leave the contract training aside and just create ah graphic design, like but not for money or people tell me what to do. I guess I'd have to do it for myself, but I just really love that. It's very um the artistry of it. And I'm not a drawer or a painter.
00:54:59
Speaker
But there's something about being able to pull together elements and make them look beautiful, relatively speaking, in a graphic design way that I really enjoy. That's great. That's different than anything that I've heard on the pod before. I love that. My last question for you, Laura, a sort of traditional closing question. it's If you could look back on your days, maybe it was at the law firm as a young lawyer just getting started.
00:55:26
Speaker
something that you know now that you wish that you'd known back then. Yeah. I think don't, there's more than one way that life can turn that will make it wonderful. That I think is look for me, like a lot of kind of overachiever lawyer types, you know, I have to get the best grades so I can get to the best college. I have to get the best college grades so I can get in the best law school. I have to get the best grades, get the best job. I have to get the best promotion, the best title, the best company so I can advance. And we're on this kind of narrow path that we think is success.
00:56:01
Speaker
And one of the biggest things I learned is the things that happened to me that were terrible at the moment were actually fantastic. And they contributed to the quality of my life in in enormous ways that I never would have expected. So I think accepting you really don't know what's best kind of ties back to that advice in your career. And if I had just kind of been okay letting things fall into place. That doesn't mean abandoning my effort. It doesn't mean directing my career in a particular way, but letting things happen a little bit more as they happen without the stress over them happening. I think I would have had a lot more joy instead of the kind of the anxiety and the stress that seemed to dominate most of my career. Well, you've certainly brought a lot of passion and joy to to our conversation. This has been really fantastic. Thank you so much for joining me today, Laura.
00:56:54
Speaker
Oh, I had a great time. Thanks for having me. And I really, as you can tell, I'll talk contracts anytime. We'll have you back. And to all of our listeners, thanks so much for tuning into this episode of The Abstract. And we hope to see you next time.