We were glad to sit down with small business champion and not-your-ordinary business lawyer, Nina Kaufman. Forbes Magazine calls Kaufman “One of the 25 Most Influential Women Tweeting about Entrepreneurship.” The U.S. Small Business Administration named her their regional Women in Business Champion of the Year. In over 15 years in business, Nina has helped thousands of entrepreneurs generate hundreds of millions of dollars.
A trusted thought leader, Nina has been featured in the Wall Street Journal, U.S. News & World Report, Crain’s NY Business, HuffingtonPost.com, Entrepreneur.com, The New York Law Journal, and the American Bar Association Journal. Her TV appearances include MSNBC’s Your Business, Fox’s Good Day NY, and Better.TV.
We spoke to Nina about why she loves working with entrepreneurs and, drawing from her vast experience, she provided tips on how entrepreneurs can be successful and have a life outside of work.
Click here to listen to our full conversation with Nina Kaufman.
At the beginning of her career, Nina worked in big law firms, but she didn’t see much opportunity for upward movement regardless of a person’s ambition and ability. She wasn’t seeing women making partner at litigation firms. They weren’t training from within for trial experience. They didn’t want her and her colleagues to develop their own book of business. In short, there wasn’t much of a future for her in a big firm.
Nina started her own boutique law firm in the mid-90s just at the beginning of the entrepreneurship explosion. She didn’t think it was useful to knock on the doors of large companies to give her new, small firm a chance. She thought about who wasn’t being served. Who didn’t have relationships cemented? The answer was clearly entrepreneurs. Nina fell into this niche and immediately fell in love with working with this group of optimistic, hard-working individuals. Nina has a particular passion for showing business owners how to build, grow, and sell their companies—and how to get the business to function without you.
Read, Learn, and Listen Before Jumping In
The number one pitfall Nina sees when working with entrepreneurs is when they jump into starting a business without any true understanding of how to run one. Often they quit their job because they’re passionate and good at what they do, and they’re tired of working for “the man.” But instead of learning how to build a business properly, they jump into it. It’s difficult to make the leap from working in your business to working on the business. It takes a CEO type of mindset to do it right and not everyone can just turn that switch on. If you’re going to be successful, you need to be educated first. Do your own reading, listen to podcasts (like Prophets of Profit!), and learn from successful business owners. If you jump in without a base, you’re going to make a lot of costly mistakes and may end up with nothing but many sleepless nights.
How to Show Value to a Small Business
Most small businesses hire an attorney out of necessity. How does Nina get small businesses, perhaps just starting out, to see her services as an added value and something that is essential to their success?
Nina explains that it’s costly to clean up a mess. Many entrepreneurs want to take things into their own hands and use an online template to incorporate their business or write up a contract. To Nina, that’s like doing their own surgery. They’re not trained. You need a good lawyer to set up your business correctly. If you have intellectual property, then it’s especially essential. If things aren’t set up correctly at the start, it’s that much more time consuming, halting to the business, and costly to fix later.
Nina is selective about who she works with. She restricts herself to clients who are in her area of expertise (marketing, training companies, consulting services). She knows that she won’t bring much to the table if she strays into an area that she does not regularly work in. Nowadays, before taking on a new client and after assessing their industry, she’ll ask these questions of the prospective client:
Entrepreneurs want to know what they’re getting into: Nina works on a fixed fee (as do Brian and Scott). People with very clear, precise answers to the above questions are good candidates.
Don’t Plan on Doing Your Business Forever
Many new small business owners don’t understand why it is necessary to have an exit strategy in their business plan.
Nina asks business owners essential questions:
She doesn’t want to hear that you want to be running this business forever. Anything can happen at anytime. You can get hit by a bus and become disabled. You need a plan for that. Are you up until 3am working most nights? Are you losing sleep? You need to be able to pull yourself back from the business and bring other people in. Perhaps the business can use better automation. Maybe you need to hire more people. Maybe you need to reassess the staff you already have. Maybe you need a different pricing structure. These matters and questions need strategic answers. Strategy will better the business, turning it into something that can be sold when the time is right.
Client-Customer Relations: Critiquing Without Criticizing
We had a question from a consultant about how best to identify their clients’ weaknesses without hurting their business relationship.
Nina suggests presenting the assessment to your customer as sharing suggestions as opposed to just pointing out what’s wrong. Present it as if you’re both figuring it out together. Be constructive, not critical. Surround yourself and work with constructive people. Create a roadmap that both of you can follow. Reassure them: You want them to have the best business possible and these are the things that can help improve it. A good plan will make for a speedy road to profits.
Let it Go
We had another listener ask about financing. What is a realistic expectation when it comes to small business financing and what qualifiers are most funders looking for?
Nina explains that it depends. What is the business and what are you looking for? Investors are primarily looking for how they will get a solid return on their investment and in what time. You as a business owner need to be prepared to relinquish some control. Determine the arc of the business. What is the option for a sale or merger? Investors are interested in their exit.
If you’ve been in business for less than two years, banks won’t even consider investing. Use your own money and go to friends and family. Bootstrap it until you’re able to get your proof of concept. Then the money you will eventually get from an investment can help roll it out or scale it further.
You need to separate your business and your ego. The money will come. Hone and craft your idea. Prove the concept to the market. And remember to reach out to people like Nina—getting set up correctly at the start is much cheaper than correcting things later on.
Click here to listen to our full conversation with Nina Kaufman.
Do you have follow-up questions for Nina? Contact her via her website at askthebusinesslawyer.com/contact
You can get a free copy of her special report on “10 Steps to a Million Dollar Business” at BusinessExponential.com/podreport.
Connect with Nina on Linkedin.
Follow Nina on Twitter.
Co-founders & Managing Partners