The following is an excerpt from Practice Perspectives: Vault's Guide to Legal Practice Areas.
Sarah Fergusson Chambless advises startup technology companies and investors on company formation and corporate structuring, early- and growth-stage finance, outside general counsel, venture capital investment transactions, and mergers and acquisitions. Sarah focuses on the technology, digital media, consumer products, and health care sectors. She also has experience in the planning, structuring, and formation of venture capital funds, special purpose vehicles, and joint ventures.
Sarah is very active in the Los Angeles startup community and regularly acts as a mentor, speaker, and guest lecturer at incubators, accelerators, business organizations, and universities. She also sits on the Advisory Board of OSEA Angel Investors, an angel investment group focused on and driven by women executives and entrepreneurs.
Sarah was selected as one of Variety’s Hollywood’s New Leaders: Lawyers in 2013 and is a Southern California Super Lawyers Rising Star (2015–2019).
Prior to joining Fenwick & West, Sarah was the leader of the venture capital and emerging companies practice at another major national law firm. Before she began her legal career, Sarah taught elementary school in Compton, CA, as a Teach for America corps member.
Describe your practice area and what it entails.
As a partner at Fenwick & West, I advise early-stage startups on corporate structuring, through their growth stages and financings, regarding general counsel and commercial matters, and on exit strategies. In addition to my client-facing work, I am among a vanguard of professionals leading the growth of Fenwick’s startup and venture capital practice in the greater Los Angeles region. The firm established its footprint here in June 2019, and I joined immediately after. Fenwick is a great match for the LA market, and it is exciting to be on the ground for the firm’s push into one of the most vibrant startup and investor ecosystems outside of Silicon Valley.
What types of clients do you represent?
My clients represent a cross-section of the creative energy, ideas, and grit of LA’s cultural and startup scene. They are in media and entertainment, including companies such as Donut Media and Frolic, which are 360-degree media brands creating original content for platforms and fans worldwide. I work with gaming companies such as Versus Systems, which operates an in-game prize and promotions platform, and with social and creative agencies, such as DFM, which is a leading innovator in public relations and influencer-based marketing. I advise business-to-business and consumer-facing software companies and marketplaces, as well as consumer products companies with direct-to-consumer strategies, influencer activations, and e-commerce-driven platforms. I also am very excited to work with investors like LDR Ventures and Female Founders Fund, which are committed to investing in diverse founders. It’s an exciting mix with a lot of variety.
What types of cases/deals do you work on?
I advise startups and growth-stage companies on issues related to company formation, corporate structuring and compliance, seed and growth-stage venture capital financings (both equity and debt), joint ventures, commercial transactions and agreements, and mergers and acquisitions. I also advise professional investors regarding their venture capital fund structuring and investments.
How did you choose this practice area?
My VC practice began to take off in late 2010 when the “Silicon Beach” startup movement in LA was gaining traction. As a young corporate attorney, I found it invigorating to advise entrepreneurs and startup companies on the best ways to avoid common pitfalls and risks. Trends in venture capital are constantly evolving, both in industry developments and in deal structuring and terms. I like that because my practice never stagnates.
What is a typical day like and/or what are some common tasks you perform?
Every day is different, which is exciting. I spend a lot of time meeting face to face with potential and current clients, investors, and fellow service providers because helping to develop relationships is a critical way that deal attorneys create value for their clients. Tech and VC clients also value responsiveness, so I spend a lot of time on the phone, email, and text, counseling clients, answering questions, and negotiating open deal points. In the afternoons and evenings, I usually attend a demo day or dinner with investors or a client’s C-level officers, or I speak on a panel about current industry and market trends. The days are long but very fulfilling.
What training, classes, experience, or skills development would you recommend to someone who wishes to enter your practice area?
So much of what makes a startup lawyer successful is gained from practical experience. Any experience running a business or working with people who are running a business provides perspectives on what our startup clients go through and what they need from their lawyers. In terms of hard skills, studies in business, finance, tax, or accounting will also broaden your perspective on how the issues of a business fit together. A passion for and understanding of technology is critical. Also, look for opportunities to improve how you speak, present, and communicate as a professional and how you manage time and tasks. For example, I have found my background as an elementary school teacher to be invaluable in boiling down complex concepts for clients in a way they understand and appreciate.
What do you like best about your practice area?
My day-to-day practice is generally positive and uplifting. I love to spend time with early-stage clients, troubleshooting early issues and helping them avoid pitfalls down the road. When working on transactions, I mentor and train associates, which I find to be very satisfying. Over time, I develop deep relationships of trust with my entrepreneur clients, and as companies grow, I build teams of other trusted advisors around them. Those relationships often span multiple companies or ventures. Adding positive value and building those enduring relation-
ships is very satisfying.
What is unique about your practice area at your firm?
Fenwick’s startup practice in many ways mirrors the ethos of our clients. For a law firm, we have a lot of latitude to do things differently and creatively and to develop our own style. The bias away from hierarchy fosters more opportunity for collaboration with very smart team members, and we work closely and quickly with clients to solve critical problems. It’s a supportive environment for people who like problem solving, enjoy social opportunities, and who aren’t scared of tackling a wide variety of challenges.
How do you see this practice area evolving in the future?
Law firm startup practices are more likely to adopt technology innovations quickly because we are exposed to our clients’ innovative products and services. Fenwick has prioritized an innovative mindset with Fenwick Labs, our in-house IT and knowledge development team, which helps unlock greater efficiencies and automation in our work. This frees lawyers up to imagine and deliver services that create greater value for our clients’ bottom lines.
What are some typical career paths for lawyers in this practice area?
The volume of clients in a startup practice exposes new law-
yers to many opportunities. Startup lawyers are generally on a faster track toward greater responsibility in managing projects, clients, and relationships. This means more opportunities to develop practical skills and a standalone practice more quickly. A startup lawyer can take one of many diverse career paths. They can become law firm partners or in-house counsel at a client, join a VC fund, launch startups themselves, or start a solo practice. Many move over to the business side over time, becoming VP of legal and business affairs or COO. I’ve had colleagues embark on all these avenues.