How to create a legal team from scratch

Tom Bangay: Hi, everyone. I think we're live. So let's get started because we're at 1 o'clock. So we have an event today, which is a session on creating a legal function from scratch to scale up. And we have this, probably every other onboarding questionnaire in community asks for this content, which means it's an evergreen topic, which is really good. So we've got some panelists today with direct experience of doing this. They're a really great bunch.

I'll ask them to introduce themselves in a second, but just on housekeeping, if you have any questions, you can just pop them in the chat and we'll try and feed them through. I've had lots of questions in advance, so we'll try and cover all of those as well. I'm just going to ask the three panelists to briefly introduce themselves and just tell us a bit about where you work and what you do and where you used to work. So I'm gonna go left to right. So I have James in a very small room on the left. Hi, James.

James Sullivan: Hi there. So James Sullivan, I'm currently working with a crypto payments business called Zyiglu. I've been here just over two years. I originally joined as chief legal officer, but in my takeover power grabbing, I became responsible for risk compliance and then chief operating officer. So I oversee legal risk compliance, first line financial crime and customer operations. Price of that was at Monzo. I've been in Fintech since about 2018. I've been in-house since 2001. So yeah, that's showing my age.

When I joined Ziglu, I was lucky enough to have had an interim GC before me. So I didn't walk in and it was a disaster zone. That was a really good thing. But ultimately, I think at the early stage, it wasn't enough for two people. So Alex, who was kindly there, she moved on and I kind of coped by myself for a while, then hired a paralegal. And then at the beginning of this year, I was fortunate enough to hire a very amazing and very senior head of legal who has kind of changed my life.

Tom Bangay: That's lovely. What a great story. Thanks very much, James. Naaika, you're next on my left to right.

Naaika Himidi: Yeah, sure. So I'm with Pleo. Pleo is a Danish fintech that creates the world's best expense management solution. I joined Pleo about a year and a half ago. And prior to joining Pleo, I spent a little over a decade in private practice, primarily working with corporate lending, acquisition finance, a lot of big bank work.

My only previous in-house experience prior to joining Pleo was a one-year secondment with a legacy corporate bank, which gave me some understanding in the workings of a financial institution, but also gave me some input as to what works and doesn't work in an in-house legal function. When I joined Pleo, I was tasked with setting up a legal function and there was an existing team that did a little bit of everything, first-line operation, fin crime, compliance, legal, and it was a lot of legacy based on the fact that we are now today a licensed financial institution.

However, when Pleo launched, it was a simple, not simple, but from a legal perspective, a simple software solution based on a third-party licensing. So part of establishing the legal function and the surrounding functions has also very much been part of the scaling of the business. But that's a little bit what brought me here.

Tom Bangay: Cool. Thank you very much, Naaika. And finally, Sarah.

Sarah Tines: Hi, thank you everyone. Thank you for having me. So I work at Tines. We are an Irish cybersecurity automation startup. So our tool is no code, low code cybersecurity automation, enabling companies across the world to automate repetitive mundane workflows and free up their time to work on higher value security work. I joined in August 2021. So over a year ago, I was the first legal hire, head of legal, at a point when we had just closed our series B and the board told our lovely co-founders to stop redlining commercial contracts themselves and get an in-house lawyer to do that.

So I was the first legal hire. So I was tasked with building this legal function from scratch. We are now a team of two, but we also outsource a lot of repetitive work to alternative legal solutions providers in Ireland and the US. And I'll come up, I can talk a little bit about that later on as part of my strategy for scaling the in-house legal function. Where did I come from? I trained as a barrister in London. I did that for five years. And then I moved to Dublin and re-qualified as a solicitor or cross-qualified as a solicitor.

I worked for some of the top law firms here as a corporate lawyer, working with technology companies all the way from sort of University spinout or incorporation, the whole way to private equity buyout or other exits. Absolutely adored working with technology founders and kind of holding their hand on that scaling journey and knew that I wanted to ultimately end up doing this job that I'm doing now.

Joining the legal team

So I left private practice over here in Dublin. I was working at Maples at the time who were one of the big global firms here and I did some consulting work for a very small American private equity firm who were setting up operations in Ireland. So that was a terrific opportunity to what I affectionately term as shake off my private practice baggage and get out of the billable hour mindset and starting every sentence with, but I'm not an employment lawyer, but here's what I think, you know. And yeah, that was terrific. So then by the time I met the CEO of Tines, I was completely ready to use to sort of embracing the ambiguity and being that, you know, solo in-house lawyer and always had a love of technology. So it was very easy for me, a very easy environment for me to kind of get used to very quickly. So that's how I have come to where I am now.

Tom Bangay: Lovely and very encouraging because I've got a friend who's trapped in his mind. He's trapped in a disputes like associate role in a law firm and he thinks he can't get an in-house job, but I've got a litigator and a barrister on this call who have now moved in-house as possible. So there is an exit from that.

Sarah Tines: 100%. And yeah, just to that point, it's very, very common in the US and Australia for heads of legal to come from a litigation background because that experience of having lived the worst case scenario is valued. So, you know, depending on the company, you can be actually the right fit having come from a litigation background.

Tom Bangay: Excellent. All right. Well, let's dive into some of these questions and I'm going to throw this first one at James, which is about understanding the business. So we call this creating a legal function from scratch, but obviously in any business that's made it past like a couple of months, some legal stuff has happened, signed some contracts, maybe raised some money. So it's not exactly from scratch, but I guess a key point is understanding what is actually happening in this business. What does this business do? So how do you go about that when you learn actually understanding what the business is and what it needs going forward?

Naaika Himidi: Yeah, it's a great question. So I think there is, I mean, somewhat state in the obvious, but I think the key, the key is really to speak to as many people as you possibly can at every level within the organization. Because I think if you speak to people on a one to one basis, first of all, you get their very personal spin on things, which I think is also really valuable because you get lots of different lenses on where the business has been and where it's going.

Make sure that you're speaking to, you know, from the senior as you possibly can, even at board level, you know, if you have the ability to speak to someone at board level, but right through across the organization, particularly people that are responsible for product development, understand some of the frustrations and challenges, I think is always a good question to ask because that usually elicits, you know, a whole lot of information that perhaps people may be holding back, which is why I think it's really important to have those discussions one to one. Understand some of the challenges around, you know, maybe there's been frustrations with legal in the past and what you can do to unblock that.

Maybe that's just about speed of execution, turning things around. Maybe there's a perception that legal has been a blocker, rightly or wrongly. Maybe that may or may not be true, but sometimes that is a perception. So try to understand some of the pain points that the business has had. Try and get yourself invited to as many forums as possible, committees. You can get to accept risk committee, accept committee, product governance type kind of committees, just throw yourself everywhere you possibly can

And that's easier said than done when day one you're probably being thrown a whole load of things that everyone has been waiting for you to deal with when you join. But I think that's all about setting expectations when you join and not necessarily kind of being perceived to be the person that's just going to be a slave to the business day one and just serve, be a servant. Ultimately, you're there to be a master and a servant. So it somewhat set the expectation of how you plan to spend your day when you're working in the new business.

Legal team priorities

Tom Bangay: Yeah, that's a great point. On that prioritization point, I guess, obviously you come in, you want to make as much time as possible to talk to important people. I'll talk to everyone and insert yourself into various conversations. And then you're also going to have, as you mentioned, this massive backlog of stuff that people are waiting for a grown up to join the company to help them with. So probably from day one, you're going to be saying no immediately quite a lot. Was that something you had to deal with? I'll probably ask all of you this, just to warn you. The 20% you wanted to handle from that backlog and everything else being proactive, how do you handle that when you land?

Naaika Himidi: Yeah, I definitely think you've got to have the ability to say no. I mean, I think lawyers have been trained over the last decade or longer to never say no. I kind of vehemently disagree with that if there are times when it's appropriate to say no. And it's about the 80-20 rule is seeing where you can make the most impact, where you can really move the needle, not necessarily just making everyone happy. And so that might mean that if people are just throwing tons of contracts at you and you could just spend all your time doing that.

You just need to think of a smart way as to how you deal with that. Like, do you just say, well, actually, I'm only going to look at contracts that have above a certain risk threshold or value threshold and everything else. You're on your own, rightly or wrongly. You just can't. You can't. Particularly if you're sole counsel, you just cannot do everything. And there'll be a whole load of things that you, as the head of legal or GC, want to do or identify needs doing that the business won't necessarily be throwing at you and you need to make sure that you've left bandwidth to do the work that you've identified is important.

Tom Bangay: That makes sense. Naaika, what was your experience of that?

Naaika Himidi: No, I just was thinking that I think a fundamental sort of in your preparation when you join and starting up a legal function, especially coming from a private practice background, is really being comfortable with the uncomfortable and also really, I think, you're trained to fix all problems and make sure that everybody gets the best service. That's one thing. But also really be comfortable that there's going to be a lot of legal risks that you're not going to be able to manage because you really have to look at what's my time investment versus the outcome.

So when I first joined Pleo in the first four, six months, when people asked me, how is it? And I continue to say the most difficult part is prioritization, not so much what to do when, but fundamentally what to actually do and really be comfortable with your choice because you're also very much leading the company's risk appetite in terms of legal risk. But there's a lot of things in the beginning where I was like, I can see that could probably be done better or have a higher standard, but it doesn't really matter in the greater scheme of things. So you really need to retrain your brain and really calibrate where you spend your time and continuously be as you scale up because I think it takes a long time until you get to the point where you're just fundamentally comfortable with all aspects of the business. And then that's not really what you should be striving to impact.

Tom Bangay: Yeah. And I guess that volume of lower impact tasks is only going to get bigger rather than smaller, right? As your company scales, Pleo scaled incredibly in the last few years. Sarah, was that your experience? Obviously you were prepped for coming into a tech company, but nothing can probably quite prepare you for how hard they're going to push you, right? In terms of stuff to do.

Sarah Tines: Yeah, absolutely. Our CEO who I report to was very clear with me from day one that my main priority was commercial contracts and supporting bringing in revenue. So I was sort of lucky that I was able, I knew exactly what I, I was in no doubt what I had to prioritize. And then closely followed by, we were expanding massively into the US as well. So anything to support hiring employees over there and setting up appropriate infrastructure. We had also just done our series B.

So as a corporate lawyer, I obviously read the disclosure letter, read things that needed to be done, was aware of, for example, the need to get the new SECs in place and a DPA up and running. So I also find it super helpful to break down my to-do list in terms of what absolutely needs to be done this week, this month, this quarter. So that kind of prioritization really helps as well. But even now, you know, over a year on where I don't, I'm not as clear on the frontline with commercial contracts anymore, it's still nonetheless, the entire company is, and we're very cross functional.

So everyone knows who I am. I work closely with everyone across the company, you know, towards the end of a quarter, because, you know, that we're sort of quarterly driven like most SaaS startups are. People just leave me alone to focus, leave the legal team alone to focus on commercial contracts, bringing in revenue. But of course, it's not always like that. There's always things that need to be done. And even over a year on, I mostly think, wow, I've achieved a lot in a year with what I've built out. But at the same time, I'm thinking, I've got nothing done and there's so much to do. So I think that's part of the prioritization piece, like reminding yourself in this working context to continually pat yourself on the back for what you have conquered and achieved. Yeah, so that's sort of how I have been able to approach it and it seems to be working.

But like that low hanging fruit, the repetitive say MNDAs, right? That monotonous, it's monotonous. It's the same thing you're looking for every time. I outsourced that after about a month, I engaged an alternative legal solutions provider to provide us with a contractor who does all of that repetitive work. So that massively freed up my time to then apply my mind to putting our DPA together or leveling up our privacy notice. So that kind of thing.

This is an excerpt from the full transcript. To watch the webinar in full, click the preview at the top of this page.