If you’re a corporate lawyer whose life involves deal work for growing companies, chances are you’re intimately familiar with the National Venture Capital Association’s model legal documents. This set of eight documents is immediately recognizable to most firms that practice in this space, and whether firms use the documents in their original form or modify them to suit their preferences, most would agree they are the gold standard for venture capital investment transactions.
The NVCA says these documents “are intended to reflect current practices and customs, and . . . one of our goals in drafting these documents is also to reflect “best practices” and avoid hidden legal traps.” The documents contain explanatory footnotes and are widely believed to present a fair balance between VC- and company-favorable terms. According to the NVCA, use of these documents is also intended to “reduce transaction costs and time.”
And that’s where we come in. At Brightleaf, our goal is to bring intelligent document automation to lawyers everywhere. For law firms, this means helping them respond to client demands for increased value and efficiency in the way they produce documents. And the NVCA’s data shows that firms are producing a LOT of their documents. Even in 2009, an admittedly slow year, law firms drafted documents for deals representing over $15 billion in venture capital investments. And most people agree that the current production method for these documents is inefficient at best. According to the NVCA, “our industry on a daily basis goes through an expensive and inefficient process of ‘re-inventing the flat tire.’” The NVCA responded to this problem by drafting form legal documents everyone could use, and we’re taking the next logical step: automating the NVCA documents.
How did we do this? Our team of experienced corporate lawyers reviewed and identified each of the substantive questions and structural possibilities in the NVCA documents. They then used our Microsoft Word-based Template Factory to turn these documents into automated templates for law firms to use. There was no programming involved and the process took days, not months. The result? With just a couple hours of training, lawyers can now log into Brightleaf and draft the NVCA financing documents in a way that’s more intelligent and efficient. That makes the lawyers AND their clients happy. And we think this is pretty exciting.