[kondro]

The biggest problem with getting lawyers involved early-on is that it's their purview to protect your interests above all else, including an equitable, workable deal.

It has been my experience that using lawyers too early will put ridiculous clauses in contracts that don't necessarily make good commercial sense or are even in the spirit of whatever negotiations you are trying to make.

Additionally, lawyers are expensive, especially early on.

My advice: sit down, talk with the other side, decide what you both want to get out of the deal, write a heads of agreement whilst reserving your rights (they aren't binding after all) so you both have documentation to ensure you are all on the same page then, and only then, get the lawyers involved to draft up an sale document based on your heads of agreement.

Lawyers are lawyers, not negotiators or entrepreneurs. Ultimately, they aren't the best people to represent you when it comes to working out what you are willing to accept to part with your baby.

[scottru]

+1 for the key message here. Lawyers aren't negotiators, and you have to remember _all the time_ that they work for you in this negotiation, not the other way around. They will give you lots of advice, and you should think of it as such, and ask questions about the real risk you might be taking, and make decisions accordingly.

I've watched friends have sales fall through because they didn't trust their own judgment when faced with their lawyer's thoughts. Apply the same confidence you have (or fake) for building your product to the redlines from your lawyers.

[arethuza]

One that thing that can also cause problems is that in many situations the companies lawyers are acting for the company not the individual interests of the founders - if you have investors or a situation where the founders have different equity stakes then it can get messy as a particular deal may favor some people and not others.

I'd also recommend doing a lot research into the acquiring company - particularly if you are being paid in stack rather than cash. I know from bitter experience what happens when you get acquired by a company that looked healthy during the acquisition process then whose stock plummeted during the lock in period :-|