Why Future Entrepreneurs Should Study Law
Published: 14/11/17 Author: Alasdair Copland
If you’ve already struggled through law school, or are currently at law school, you’ll have an idea of the set of skills you need to make it. If you’re studying law and you’re not struggling, you’ve either got these skills, or more likely, you’re in denial.
Reflecting on how to apply what’s required in a law degree outside of the context of the work of a solicitor or barrister provides a perspective on the real-world value of a law degree.
Let’s consider, for instance, the entrepreneur. A lot of people dream of becoming the next Mark Zuckerberg. After all, who wouldn’t want to run a business? You would be your own boss – start something from scratch, watch it grow into something you could take pride in. This, of course, assumes the business would be successful – but let’s consider, to begin with, how you could get your business started.
You need the idea for a product or service that you want to market. Then it’s just a case of selling it, right? Well, not quite. Are you going to set up as a sole trader or a limited company? Do you have a partner? Is it in your best commercial interests to have one? Would it be better to establish the business as a limited liability partnership? Unless you’ve studied business, business law or are well-versed on the differences between these commercial set-ups, I can feel you itching to get Googling. Wouldn’t you feel a lot more confident in your decisions if you’d taken a term’s worth of company law?
The answers to these questions can, of course, be figured out with a bit of search-engineering. Indeed, having studied law, you might not even remember the specific differences between company structures. But there’s a better chance you’d be immediately familiar with how to go about finding the answers, and would find it easier to understand the terms that came back in your search results.
On the other hand, there’s the popular line of thinking which notes that Zuckerberg (and Branson, Jobs and Gates, among others) graduated with a cool number of zero undergraduate degrees. Why study law if you want to be an entrepreneur? Don’t bother – just come up with a brilliant product, and put in the time and effort to make it work, then hire the best lawyers as and when you need them. Right?
One issue with this argument is that it glides over the fact that Zuckerberg has spent in excess of $350m on settlements for legal disputes. Perhaps even with a deep legal knowledge, he would have struggled to avoid being sued, and maybe these lawsuits were a necessary consequence of Facebook’s success. But once again, having a detailed legal knowledge certainly wouldn’t have hurt.
More problematic is the slippery slope down which the argument leads. If you can hire a lawyer to deal with the legal problems, why not hire marketing executives to sell the product and inventors to develop it? Accountants, business development and sales executives, managers, communications professionals, and so on? Particularly at the early stages of a start-up, you’re going to need to minimise your overheads to have any chance of your business surviving. Trimming away some of the legal fat is a sure-fire way to save money on one element of your entrepreneurial project.
None of what’s been covered so far even touches on the interpersonal, time-management and analytic skills developed in by studying law, that could prove instrumental to the CEO of a start-up. Maybe you’ve already got the idea, drive, ambition and knowledge to found and run your next business. If, on the other hand, you’re still waiting for inspiration to strike, it isn’t a bad idea to look into law.