From a Startup Attorney's Perspective: Why I Believe Integrating Generative AI Makes Me a Stronger Ally for Your Business

I must admit, I was initially skeptical about the potential impact of AI on the legal profession. So, I invested a modest $20, rolled up my sleeves, and decided to dive in. I spent time exploring and testing various AI solutions, evaluating their abilities, strengths and weaknesses to understand their true potential in the startup and emerging growth arena. While it is still early for AI in this field, there is no denying its potential. I believe that as the technology continues to advance, it is essential for startup attorneys to embrace and incorporate AI solutions.

Here are some of the initial ways I have discovered how AI can be utilized in my own practice:

• Company Formation: AI can streamline the creation of essential documents required during company formation, such as articles of incorporation, operating agreements, employment agreements, restrictive covenant agreements, and other corporate consents and agreements. This cost-effective approach reduces drafting time, allowing attorneys to focus on providing tailored advice for a startup’s unique needs.
• Fundraising & Corporate Governance: Raising capital can be a complex and time-consuming process; AI can provide support in drafting and reviewing term sheets, investment agreements and other fundraising-related documents more efficiently. AI-powered tools can also aid in streamlining corporate governance processes, freeing up attorneys to advise clients on best practices for structuring management and decision-making procedures.

• Contract Review: AI can expedite the contract review process by identifying key clauses and potential risks in a matter of seconds. This efficiency allows startup attorneys to focus on providing strategic guidance and negotiation support
• Mergers and Acquisitions: In addition to the contract generation mentioned above, AI can be valuable during the due diligence process of an M&A transaction by quickly identifying potential issues or risks in contracts, financial documents and other relevant data. This enables attorneys to focus on providing strategic advice and helping clients make informed decisions during negotiations, ultimately leading to a smoother and more successful transaction.
• Efficient Communication and Collaboration: More generally, AI can facilitate more efficient communication and collaboration by helping attorneys quickly access relevant information and respond to client inquiries.

Most, if not all, of my clients understand the importance of innovation and staying ahead of the curve. As such, I see AI as an exceptional opportunity to enhance my services and deliver value to my clients rather than a threat to the legal landscape. Leveraging AI’s capabilities not only enhances efficiency and the quality of my services but also allows me to focus on providing strategic advice and tailored solutions for my clients’ unique needs. By staying ahead of the curve and adapting to technological advancements, I can ensure that my services remain cutting-edge and well-prepared to meet the evolving needs of my clients.

Naturally, I would not be a lawyer if I didn’t offer a word of caution: As we explore AI’s potential in the legal profession, prioritizing client confidentiality is crucial. For now, I recommend using AI with deidentified data or within a controlled “sandbox” environment to ensure sensitive client information remains protected. As AI technology evolves and security improves, we can gradually expand its integration, always maintaining the privacy and trust of our clients as our top priority.

Author Jason Acevedo is a partner in the Venture Capital & Emerging Growth practice group in the Corporate and Securities Department at Klehr Harrison.

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