Venture Capital Firms Like Sonfinnova Ventures Offer New Career Opportunities for Corporate Attorneys

Viewing them as an unnecessary expense, venture capital firms have been reluctant to hire in-house attorneys.  However, that's starting to change as more venture funds are hiring their first general counsel.  While some of the larger venture firms began hiring in-house counsel at the start of the decade, as funds grow in size and geographic area, more firms are hiring in-house attorneys.  The venture capitalists appear to be pleased with their decision to hire a general counsel.  For example, Mike Powell, a busy deal-maker and general partner at Sofinnova Ventures, says of his firm's GC, Hooman Shahlavi, "He knows exactly what we want in every document.  [Having Shahlavi at the firm] literally saves me one day a week."  Powell is so pleased with Shahlavi's work that he wishes Sofinnova had hired an in-house attorney years ago.

But what is the role of this new "VC GC"?  Rodi Guidero, the chief counsel at Velocity Interactive Group opines, "The idea with someone like a GC is to let the investment professionals source deals and let those that can execute them go get 'em done."  Moreover, the lawyers who take these new jobs are defining their new roles.  A complete list of the duties would probably be impossible, since the position of VC GC is so new and still evolving, but here are some of the highlights:

• working on follow-on investments and exits, such as acquisitions or public offerings;
• working on financing deals;
• cooperating with outside counsel;
• answering questions for the companies their firm funds;
• helping the firm comply with overseas regulations, as venture funds increasingly work with investments all over the world; and
• doing more routine legal work, like employment matters and litigation, that goes along with any in-house attorney's job.

Overall, the VC GC's emphasis is on the deals and representing investors well once a company seeks to be acquired or go public.  According to Matt Bonner, counsel at DCM in Menlo Park, California, a key value of in-house counsel at venture firms is "being able to be here all the time, so we can proactively address any legal issues that come up."

The newness of the VC GC role leads venture funds to seek their in-house counsel from law firms where they can find lawyers with experience in transactions, and often those law firms that had been doing work for the fund.  For those lawyers who leave their firms to work in-house at a venture fund, the pay is comparable to what they earned at their law firms.  That seems like a good deal for these trailblazing attorneys who are adding value to the venture funds' deals and facilitating them.

By Steve Imparl, guest blogger