FAQs
Can contractors or international employees receive equity?
Yes, but typically through NSOs, RSUs, or phantom equity rather than ISOs. International employees may require country-specific equity plans due to tax and legal differences. Always consult counsel before granting equity outside the U.S.
Do founders always keep control of the company?
Not always. While founders begin with control, each financing round introduces new investors with board seats, voting rights, and protective provisions. Some founders implement dual-class stock or other structures to retain control, but most startups rely on alignment with investors rather than super-voting rights.
How does dilution affect my ownership?
Dilution reduces your percentage ownership as new shares are issued, but it doesn’t necessarily reduce the dollar value of your stake. If a funding round increases valuation, your smaller percentage may still be worth significantly more in absolute terms.
What happens to employee equity if the company is acquired?
It depends on the acquisition terms. Options may be assumed by the acquirer, cashed out, or accelerated. Double-trigger acceleration is common, meaning unvested shares vest if the company is acquired and the employee is terminated without cause.
How often should we update our 409A valuation?
At least once per year, or whenever a major event occurs (funding round, acquisition offer, significant revenue milestone). A current 409A valuation is required to set fair market value for stock option grants and to maintain compliance with IRS rules.
What’s the difference between RSAs and RSUs?
- RSAs (Restricted Stock Awards): Shares are issued upfront, subject to repurchase rights if unvested. Best for founders and early hires when valuation is low.
- RSUs (Restricted Stock Units): Shares are delivered only when vesting is complete. Best for later-stage hires when valuation is high.
What is an 83(b) election and who should file one?
An 83(b) election allows recipients of restricted stock to pay taxes at grant rather than as shares vest. Founders and early employees almost always benefit from filing, since share value is usually negligible at the start. Missing the 30-day deadline can create significant tax burdens later.
Do all startups need an option pool?
Yes. Even small teams benefit from reserving equity for future hires. Without a pool, you may run into hiring roadblocks or face last-minute dilution negotiations with investors. Most early-stage companies set aside 10–20% of total equity.
General
How do I get started?
Book your free consultation here now!
How are you different from LegalZoom or BizCounsel?
LegalZoom and BizCounsel have done a great job of providing low costs to its customers - they rely heavily on templates that can be found almost anywhere on the internet and also don’t deep dive into YOU and your business as much as @VirtualCounsel does.
With @VirtualCounsel, you have a dedicated attorney point of contact who develops a deep understanding of your business model, goals, and way of operating - we provide far more than templates. We become true counsel in short order based on the level of involvement we have with you and your business - we balance legal protection with business goals and become strategic advisors that are more than just lawyers.
How are you different from big law firms?
We are a tight team and like it that way. We have work/life balance ourselves. Names, faces, families, souls. No corporate bureaucracy. Big law firms employ humans too, but they are kind of like a top-down scheme that focuses on demanding work hours from lower-level associates who are incentivized to increase billable hours and not incentivized to increase their or their clients’ success and happiness.
We developed our model so that we can select powerful businesses to align with as our clients and provide true partnership and counsel - our clients’ success and happiness are directly aligned with our success and happiness.
What law firm will provide my legal services?
VirtualCounsel, PC (i.e., @VirtualCounsel) is a virtual law firm, headquartered in San Diego, CA.
@VirtualCounsel™️ is not a law firm. Any legal services will be performed by the law firm VirtualCounsel, PC, a California professional law corporation.
What is @VirtualCounsel?
VirtualCounsel, PC (i.e., @VirtualCounsel) is a virtual law firm headquartered in San Diego, CA. We are progressive corporate attorneys. We are a startup ourselves, and we built our law firm to serve startups in the way that we believe a professional service provider should serve their clients.
Do I get a dedicated point of contact?
Yes. At the beginning of a relationship you will have a kick-off call with one of our talented attorneys who will operate as your primary point of contact. Even better, our technology gives our whole firm - all attorneys, legal staff, etc. - visibility into every client’s confidential portal. So you will have a team of bright minds collaborating on the important work for your business - and will always have your primary attorney point of contact running point.
What if something falls outside of the Scope of Work?
We provide representation and advice on the specific legal matters you have hired us for, which means that our work together is limited to the Representation. If a project falls outside of the Scope of Work, we will always discuss the parameters of the work and fees with you before moving forward with it.
Additionally, if your business changes substantially, we will discuss the change in Scope of Work and will agree to a revised fee arrangement. Representation on any future matters will be subject to the terms of this Agreement and any other fee arrangements we may mutually agree upon. The question of whether a matter or issue falls within the scope of this Representation will be handled with common sense, mutual agreement, mutual respect, and fairness to both parties.
What is an A la Carte project?
A la carte projects refer to individual, one-off projects with a specific scope of work. These projects can be carried out for new clients or for current subscription clients when the work falls outside the scope of their subscription. On a case by case basis, we may bill these projects on an hourly basis or as a flat fee.
Pricing & Billing
How will I be charged?
Legal fees are often a hot topic with our clients, so we want to share our philosophy with you.
We prefer to engage in a Flat Fee or @VC Monthly Subscription for legal projects instead of charging by the hour because we plan to become strategic partners with our clients, and we want to help you grow. We have found that engaging in a Flat Fee or @VC Monthly Subscription fosters a better attorney-client relationship.
Because we want you to succeed, we will always treat you with respect and fairness. We never want you to be shocked with a surprise bill. That said, it is not a requirement to engage us through a Flat Fee or @VC Monthly Subscription, as some matters are better suited for hourly billing. If/when hourly billing becomes necessary or preferable from either or both parties’ perspectives, we will discuss it with you in a collaborative forum.
How do Flat Fees work?
Click here to see all of our flat fee services.
For Flat Fee projects, we will send you a fee quote in writing by electronic means, which will specifically describe the parameters of the project, i.e., the Scope of Work. Payments for Flat Fees are required before beginning work and are considered earned and deposited directly into our operating account when charged.
All Flat Fee projects are capped at a certain amount of hours of total Firm billable time, as indicated in each Scope of Work on the corresponding quote or invoice ("Total Project Hours"). The Total Project Hours cap is designed to provide ample time to complete the initial Scope of Work and also to create a boundary in the event the Scope of Work expands beyond what was initially communicated or anticipated by the Client and/or the Firm.
If the Scope of Work exceeds the Total Project Hours for any Flat Fee project, we will communicate the expanded scope in good faith and offer to complete it at 20% off our standard hourly rates.
How do Hourly Rates work?
We take a strong stance on hourly billing, preferring to quote reasonable Flat Fees or engaging with our clients in an ongoing @VC Monthly Subscription for legal services. However, from time to time our clients choose to hire us on a traditional hourly basis.
For projects or work product that is billed hourly, the Firm's hourly rates are as follows:
- $745/hour for Transactional, Tax, or Special Counsel, as needed from time to time on special transactional matters;
- $595/hour for Senior Attorneys and/or all securities, transactional, and equity-related legal work;
- $495/hour for Associate Attorneys and/or all other legal work;
- $245/hour for Paralegals and Law Clerks.
Our hourly rates may increase in the future. Any such increase will only occur upon written notice to you. If you decline to pay the increased rates, we will have the right to withdraw as attorney for you if permitted under the Rules of Professional Conduct of the State Bar of California and/or applicable law.
Time is charged in minimum units of tenth-of-an-hour increments (0.1). Time spent on a task will be rounded up to the nearest tenth-of-an-hour. Unless we agree otherwise in writing by electronic means, all work will be billed on an hourly basis.
How do Retainer Deposits work?
For projects that are billed hourly, the Firm requires a minimum retainer deposit or payment method on file. The @VC Billing department will provide the Client with detailed invoices for hourly projects every two weeks, which will become payable within five (5) business days. During that time, please carefully review the detailed invoice and raise any questions or concerns you may have with the @VC Billing department.
Absent any questions or concerns, we will draw down on the retainer deposit to cover the invoice. We will replenish the retainer deposit in equal installments using a payment method on file.
Retainer deposit funds belong to you, the Client, until we earn fees by invoicing our services. Any funds paid towards retainer deposits will be deposited into our firm's trust account and handled in accordance with our trust accounting policies pursuant to California Rule of Professional Conduct 4-100 and Business and Professions Code §§ 6211-13. This does not apply to Flat Fees or @VC Monthly Subscription fees, which are considered earned when charged. Unless we agree to a Flat Fee or @VC Monthly Subscription, all work will be billed on an hourly basis.
At any time, you are entitled to request a return of the remaining balance in your retainer account by written notice to billing@atvirtualcounsel.com.
Are filing fees/expenses included in any of your fee structures?
Our fees DO NOT include third-party charges for postage, filing fees, license fees, application fees, or other charges and fees. Notably, this includes fees associated with forming a corporate entity and/or amending Articles/Certificates of Incorporation or other similar corporate documents and/or filing with governmental authorities. When we pay those fees on your behalf, you will be billed for them at cost.
Services
How much does @VC Monthly Subscription cost?
Our subscription tiers range from $475 to $7,995/mo depending on your company's size, needs, stage, etc. Click here to see all our subscription tiers.
How do I know which subscription level to choose?
We customize our monthly plans to suit your needs depending on your company's size, needs, stage, etc. Schedule a free consultation and we will find the best subscription tier for your business!
How does @VC Monthly Subscription work?
All plans include on-demand communication and access to us and varying level of service depending on the subscription tier. Click here to see all our subscription tiers.
What level of contact will I have with my attorney if I’m a @VirtualCounsel subscriber?
You have on-demand access to your attorney POC and the entire team via Slack, Basecamp, and email. Also, depending on your subscription tier, you will have a standing call set up either monthly or bi-weekly with your attorney POC. You may always call us ad hoc on top of our standing calls, but we’ve found that between the on-demand access and standing calls, you’ll be more than covered.
How do I communicate with my lawyer?
With your @VC subscription, you will have unlimited access to your attorney POC and the entire team via Slack, Basecamp, and email. Also, depending on your subscription tier, you will have a standing call set up either monthly or bi-weekly with your attorney POC. You may always call us ad hoc on top of our standing calls, but we’ve found that between the unlimited access + standing calls that you’ll be more than covered.
Check out all of the tech we use here!
How does the subscription cost stack up against hourly?
On average our clients pay about 1/3rd of the cost if they were paying by the hour. We know, it’s a bit hard to believe, but what happens in our relationships with clients is that - since you’re not being charged for every email and every minute on the phone, you end up communicating with us way more - that’s the point!
What is the subscription commitment term?
The @VC Monthly Subscription is a three (3) month automatically recurring commitment.
You may request to downgrade or cancel your @VC Monthly Subscription by providing at least thirty (30) days' written notice to @VC before the end of your then-current three (3) month term. If you provide such notice, your downgrade or cancelation shall take effect at the end of the then-current term. Any such requests made outside of that thirty (30) day window shall become effective at the end of the next three (3) month commitment term.
How flexible are your subscriptions?
We've found that business and the law are fluid. Some times of the year are "heavier" than others and the unexpected comes when least expected! We typically "flex" with our clients during those times without needing to upgrade the subscription investment.
However, as our clients scale, the volume and complexity of work tend to increase and become more regular. We monitor that, and will communicate in good faith any subscription changes needed if/when that time comes.
What is the @VC Lite subscription?
@VC Lite is our most affordable plan that offers ongoing access to our team and light review of documents / contracts as needed at a fixed monthly rate.
Subscribers benefit from a 20% discount on all a la carte (i.e., flat fee or hourly billed) services as long as the $1,000 retainer is maintained.
Why do I need to maintain a $1,000 retainer?
Maintaining the $1,000 retainer ensures you qualify for a 20% discount on all a la carte services. This retainer acts as a deposit, giving you immediate access to additional services beyond the scope of your subscription.
How are a la carte services handled under subscriptions?
Any work that falls outside the scope of your subscription will be billed separately. For transparency, we will send you an invoice detailing the charges. After that, we will process the payment using the card or payment method we have on file.
Why don’t you use the funds directly from the retainer for a la carte work?
We keep the $1,000 retainer untouched to simplify the billing process and ensure you always maintain the 20% discount benefit. If we deducted from the retainer and immediately required replenishment, it would create unnecessary back-and-forth for both you and us. Billing a la carte projects separately avoids confusion and ensures transparency.
How will I know if a service falls outside the scope of my subscription?
Before proceeding with any work that falls outside the scope of your subscription, we will inform you in advance and provide details about the service, including an estimate of the time and cost involved, if possible. We will seek your approval before moving forward, ensuring full transparency and no surprises.