Should I change my existing law firm and hire a new law firm for my startup?

Yes. But maybe not for the reasons you think.   1.  You are not happy with them.  They do not seem to be able to handle your work.  Nothing else to discuss, but, because I am a small shop, I want to discredit some of your other thinking for others, so allow me, please.     2.  The fact that others on the start up scene don't know them is indicative, but not in and of itself conclusive.  There are tons of big firm name players that don't know me because I do not do enough volume to be recognized.  My clients would not be saying the things you are saying about your firm.  To the contrary, I have clients who tell me they feel better represented by me than with the large firms.   3.  In terms of selecting a "good" law firm establishing credibility, lets delve into that a little.            a. To the extent "good" means competent, yes it is.  If you can't pick a good lawyer . . .  If you don't have confidence in them, why would you think an opposing party would respect them as negotiators?             b.  To the extent "good" means big or brand name, I disagree, but that is a personal preference, obviously.  The first and primary job of your lawyers is to get your legal work done.  Whether you are with a small shop that oversold themselves or a big shop where you are too small a fish and only getting attention from junior associates is not really relevant.  Point is, they are not doing job one.  Some disagree and think big brand is everything, but it does not seem an issue with you, so make the choice consciously.  I tell prospects all the time that if you think that is an issue, go, be happy.  There are plenty out there coming my way who feel differently, some of them used to be big firm believers.   4.  I agree with .  Making sure the legal work is done, done right, and done on time is job one.  Introductions to angels are not the purpose of lawyers.  If it happens it is a bonus.  Plus, it is often hard to get the attention of the partners with the biggest rolodexes at those firms, so you may not get what you want.   5.  I disagree with .  Lawyers are part of the negotiating and closing process in any deal.  If you lack confidence in the ability of your lawyers to do this, get new ones.  But they are only part of the team.  If you've got the wrong person in that position, get someone new.  Last year, I was brought in at the last minute regarding a merger, with two 1500 lawyer firms on either side of me.   My clients will tell you they were very happy with my work.  So, I maintain, size is not the issue.   6.  I am not sure how the compensation structure came about, but I find it problematic.  Given what you've said so far, I am going to take it that the law firm really does not understand a good way to structure these deals.    While is right, that we can't pay the mortgage with deferred fees, I have always found ways to get this done in a fashion that my clients feel is reasonable given the alternatives.   The first problem is 4%.  I would never dream of taking that.  That is the high equity for your first post funding VPs who are going to be dramatically more valuable to your enterprise.  A lawyer holding that much gets in the way of the company effectively disbursing equity to necessary constituencies.  I'd be concerned that funding sources would be turned off by this.   Second, $550 per hour is high.  If they are a small shop, I doubt they are getting that anywhere else.   Third, is an indefinite deferral.  Precisely because we can't pay our mortgage, experienced small players in the area know how to manage through this with full knowledge of the competitive landscape of the large players who offer deferrals to you as a loss leader. (See above regarding being staffed with junior associates).  I think my clients believe my arrangements are fair, even though they require some cash and know that large firms can offer more generous deferrals.This answer is not a substitute for professional legal advice....

has already written a great answer but I'd like to add one point. In your question details you mention, I'm tempted to fire them and hire a more capable law firm suited to connect us with angels and manage the negotiations with the big players. You shouldn't be relying on your lawyers for introductions to angels or for closing an enterprise deal. Those are core skills to have on your team, and it's uncommon to expect your lawyers to execute such tasks. An introduction is fine, but closing a deal is beyond the norm. For what it's worth, an introduction from a bank or law firm isn't a very strong introduction. See for example. Perhaps you are expecting too much from your law firm.

I am answering this question by request. It is important to trust, and have a good relationship with, your lawyers and other advisers. If those elements are missing, it is understandable that you would want to go elsewhere. A client can terminate its relationship with an attorney at any time for any reason. If I understand correctly, the firm hasn't done any work for you, so it is difficult to see any gotchas in terms of impact on your business's operations. Without seeing your agreement with the current firm and knowing more facts, however, it is impossible to know whether termination of the relationship will have any financial impact down the road.This answer is not a substitute for professional legal advice....

There are several good answers already but I will add my two cents because i was asked to answer.  The most important factor in choosing a lawyer is your comfort level in working with that person - it isn't necessarily about the firm but rather the individual who will be primarily responsible for the relationship. First and foremost, you need to trust that this person has your best interests at heart at all times, will be actively involved in the relationship and won't pass you off to someone else and  has the depth and breadth of experience you need.  All of the other stuff about how well known the person or firm is,  whether they can make intros and frankly billable rates are factors but not the key factors - in fact, a very experienced person with a higher billable rate may in the long run be less expensive than an inexperienced person at a lower rate (it takes longer and costs more to fix mistakes). Having said all that I agree that 4% is a very high equity stake for a law firm and $550 an hour is a high rate for a small firm that isn't well known. Further i don't like deferral deals as you will not be able to judge on an ongoing basis how far in "debt" you are getting - i find that deferral deals end up with neither side being happy because when it comes time to pay the piper you are shocked by the size of the bill and the law firm almost always ends up taking a  haircut.This answer is for informational purposes only and is not a su...

The big gotcha is that you have to make sure that the law firm you have is working for you. If the law firm that you find is introducing yourself to angels and does negotiations with big players on a day to day basis, you have to be careful that they aren't sacrificing your interests to the interests of the angel or the big players.  It's possible that in order to maintain good relationships with the big players, they are bargaining less hard for a good deal than they could. Personally, I've had more luck working with "unknown" lawyers than lawyers in big firms.  Part of it is that when I deal with a big legal firm, I end up with the culture that I wanted to get away from, whereas with a small and ambitious firm, there's more of a cultural connection.

It should not be too difficult to change lawyers – companies switch lawyers (and work with multiple lawyers) more often than you think. Despite the new lawyer needing a small amount of time to get up to speed on your account, making a switch should not be too time-consuming or expensive. It is hard to know from your question exactly what has happened, but it is very important to have a lawyer you feel as though you can trust and depend on. If you do not feel this way, or if you and your lawyer’s personalities or work styles do not mesh, you should not hesitate to look elsewhere for legal advice. There are lots of lawyers out there, and you want to find the best one for you and your business. At the same time, it is important for your lawyer to know your expectations up front so that there are no miscommunication. Talk to your lawyers about what you’re looking for and make sure that you communicate frequently and openly. http://blog.priorilegal.com/hiring-right-lawyer/ on Priori’s Blog provides a list of tips for hiring the right lawyer and questions to ask during your consultation. If you ever do need a lawyer, don’t hesitate to look to http://www.priorilegal.com/. Priori Legal offers small businesses a network of hand-picked and pre-vetted lawyers to choose from for their legal questions – all at a discounted rate.