Last Thursday, we sat down with Jesse Jones—the founding partner of Fourscore Business Law and one of the Triangle’s most active lawyers for startups—at Raleigh’s Lonerider Brewery for the first edition of “A Beer With…”
Over pints of Shotgun Betty, Jones spoke about marrying his high school sweetheart, playing baseball in Nicaragua, how he ended up in the Triangle, seeing a sign at a Durham Bulls game that changed his life, and what he enjoys about working with startups vs. a big corporate firm. All while drinking a beer.
This is our (lightly edited) conversation.
Pete McEntegart: So this is the inaugural “A Beer With…” feature; we’re making it up as we go along. What did I say on the way over here—that it will last 15 minutes or whenever you finish your beer, whatever comes first.
Jesse Jones: So if you ask me a few quick questions and I chug this, then I’m done?
PM: Yes, it’s your call. You choose your own adventure… All right, so you are from South Jersey and played baseball in college, right? Tell me about that. What position?
JJ: I pitched at Eastern University, which is very close to Philly, so it was close to home and also where my future wife was. I played baseball my freshman year, played fall ball my sophomore year, and then I got accepted into an internship for athletic training. But the school would not let me play and do the internship, and I was really upset about it. But I thought I really wanted to do this athletic training thing so I decided not to play in the spring my sophomore year. In the meanwhile, they fired the coach and hired a new guy.
So I did the internship and hated it. It was probably the only thing I’ve ever done in my life that I was sure I would have loved, but just hated it. It was a totally different experience. I grew up playing sports, I love sports, and thought I wanted to be around sports—but I hated being around sports if I wasn’t playing. Though it’s probably good that I did that because I still really liked what I was learning about; I just got off on that athletic training track.
PM: Did you play baseball again?
JJ: I played baseball my junior under the new coach, who was just—it was a miserable experience. It was not fun at all. But after my junior year, I made a team in the summer for an organization called Athletes in Action. It’s affiliated with Campus Crusade, a student ministry group. That was awesome. It was totally worth the crappy junior year of baseball.
It was two months long. We had a training camp in Texas for about two weeks. Then we went to Nicaragua for three weeks, Venezuela for three weeks, then we went to Puerto Rico, and then back to Texas.
PM: That’s some serious baseball.
JJ: It was awesome. It was really a life-changing experience. The people there were so cool. Especially Nicaragua; a lot of them did not have anything in terms of material possessions but they loved baseball and loved that we were there. We were just playing for fun, you know? We had stuff set up with local teams, and we actually got to play against—I’m pretty sure it wasn’t the legitimate national team—but we got to play in the National Team Stadium in Nicaragua against probably like their B or C team.
That was a blast. Our coach put everyone in to hit, even the pitchers. He was just like, “You gotta go up and face this guy.” The guy was throwing 95 mph; I’d never faced anything like that. It was an awesome experience and ended up being the last real team that I was on. I decided I just didn’t want to go play for that college coach again, and I had such a good time I was like “You know what? I think this is the right way to end.”
PM: So after law school at Wake Forest, you first ended up in Delaware. How did that happen?
JJ: It was very quick; they don’t give you a lot of time in law school to figure things out. I was interviewing for my second summer’s job in the summer after my first year. I was interviewing with all Philadelphia and Delaware firms, maybe a couple of New Jersey firms, but all in that area. And I ended up getting a job with a firm called Morris Nichols, which is a 100-year old firm up in Wilmington, Delaware. A very sort of New York-style hours and type-of-work firm. Very sophisticated work, very narrow but very deep.
But after that first summer at Wake we ended up moving from one place to another. We moved from living in basically a parking lot—a big apartment complex north of the campus—to right downtown Winston-Salem. And that changed everything. All of a sudden we were around a bunch of really good friends, and I was like, I really kind of like it here.
But I had just accepted a job in Delaware. And it was also 2008, so there weren’t a whole lot of firms hiring. I felt that, I’ve got to go with the job at this point.
So I went to Delaware and spent three years there, but pretty much instantly knew that’s not what I wanted to do or where we wanted to be. And so pretty quickly I started looking for something in North Carolina. And I did maybe four or five interviews with really big firms in Charlotte. I got some interest and even had multiple interviews with the same firm, but I wasn’t super-excited about it, and I never really got an actual offer. That was still like 2010-2011, no one was really back hiring yet, they were just looking around.
I was working with a recruiter in Charlotte, and he was friends with a recruiter in Raleigh who was looking to fill a spot at Smith Anderson. That was the only interview I had in Raleigh. And they took forever. It took them six months after I interviewed to respond, to tell me whether I had the job or not. Ironically, we had our third child in Delaware, and the morning after Kate was born, I got a phone call from Smith Anderson offering me the job. So I was like, O.K.!
PM: Were you in the hospital or at home?
JJ: We were in the hospital.
PM: So you said, “Yes—when can I start”?
JJ: Yeah, we were all excited. We moved like three weeks later [in mid-2012].
PM: So at Smith Anderson, you started working more with startups. Was this with Merrill Mason [a partner at Smith Anderson and longtime lawyer for Triangle startups]?
JJ: Yes. Especially in the first year or two, I worked almost only with Merrill. I had never done any startup or venture work before that. I learned almost everything from working with him. It was a really good experience. I probably got five years worth of work in compressed into three years. It was a huge learning curve because I just didn’t know what I was walking into.
But as quickly as I realized I did not want to do what I was doing in Delaware, I realized that this was exactly what I wanted to do. So I spent three years there and was surrounded by some really, really good attorneys and working with a lot of different people. I did a lot of M&A and did tons of venture financing.
PM: What did you like about working with startups?
JJ: I think it’s more personal. What I was doing in Delaware, we were very removed from the actual business deal. Because it might have been a $10 billion dollar deal, but it was really some huge New York firm—like Cravath—that was doing the deal. But the companies involved were all Delaware entities and they needed some kind of legal opinion or specific help, and that’s why they would call my firm in Delaware. And that to me was very boring. I got no exposure to the actual business deal, which is what I found interesting.
With early-stage companies, number one, they can’t afford to have three layers of law firms working on it. And number two, it’s not that complicated. Once you sort of understand the components of it, they’re largely repeated. There’s going to be tweaks and differences here and there, but if you know what’s “normal” then you can adjust to the current deal and to trends.
PM: So it’s more about the people. But each deal is a little different?
JJ: Exactly, each deal is a little different. It depends on who the investor is, depends on who the entrepreneur is, depends on how badly they need the money and how badly the investor want to make the investment; there’s a lot of different things that could happen. But the point is that it’s very close to the people, and that’s what I think really hooked me. I really like seeing the impact that I can have, and see the difference that I can actually make. It was really hard to see that in Delaware…
PM: Because that big company is still going to exist…
JJ: Right. I was the guy that was working on the 20-page legal opinion that is pretty hard to justify is actually necessary, but it just makes everyone feel better to have it. They would call us two days before the closing date because they felt that we didn’t really need to be involved in anything else—and they were right. But I just felt like I was missing out on all the fun stuff.
PM: So from Smith Anderson, you went to the Forrest Firm [in 2015]. How did you end up there?
JJ: When I was at Smith Anderson I kind of reconnected with Jeff Wolfe, who I went to law school with; he was a year ahead of me at Wake. So we overlapped at Smith Anderson for about two years, maybe a little more.
Jeff left to join Forrest Firm, which at the time was just James [Forrest], a solo practitioner. Then Jeff went there, and it was just the two of them for about six or nine months, and then Jeff called me and asked if I would ever interested in doing something other than Smith Anderson. And I kind of was interested, but I was not really interested in joining a two-person law firm. But he was a friend, so I had lunch with them. They told me all the stuff they were doing and I said that sounds really cool; it’s not really what I’m looking for but I’m glad you’re happy.
Then I went to a Durham Bulls game and Forrest Firm had an outdoor wall sign. I saw it and I was like, that’s kind of weird…
PM: It was a sign, literally…
JJ: Right. [laughs] It was just a two-person law firm, so I thought “that’s kind of weird.”
PM: So you thought they had big plans?
JJ: I don’t know, I just was not expecting it. I remember texting Jeff and saying that I went to the Durham Bulls game, and I didn’t realize you guys were big time. So he called me and we talked again. And I sort of realized, what am I going to do? I never really wanted to be at a big firm. That was not my intention when I was in law school. I always wanted to start my own business. And I just sort of realized that I’d been at big firms for six or seven years at that point. So I was like, “Am I just going to stay here and make partner—and this is it, this is what I’m going to do?” I mean, that’s fine. But the more I thought about it, I was like, “Why? That’s not what I want to do.”
And so I met James—if you haven’t met him you should meet him, he’s super-impressive, an awesome guy. We kind of hit it off and we just kept talking, and I started doing a little side work for them. Then I got to the point where I couldn’t do both things; I had to make a decision. I talked to my wife, and I was really nervous about it. I went from Smith Anderson with 150 lawyers—it’s not going away no matter what happens—to jumping into a two-person law firm where I’m the third fulltime lawyer.
PM: How many do they have now?
JJ: I haven’t checked the website, but I think they’re almost at 40. In the two years I was there, we went from three to about 25. It was crazy and it was awesome.
PM: And mostly startups?
JJ: I was doing all the startups and venture stuff. Part of the reason we moved that fast is because we went from three corporate lawyers to adding an employment lawyer, and real estate people, and litigators, and IP people. Basically it went from just a corporate boutique to a full-service firm. And I was really looking for the opportunity to do what I could not do at Smith Anderson: bill 2,000 hours a year, and build my own book of business, and eat dinner with my kids. I could not do all three things—one of those had to give.
At Smith Anderson I couldn’t really give on the hours, because that’s what I was getting paid for. So I had to decide, Am I going to go to this kind of stuff (i.e. having a networking beer), come out to these events and get out of the office, which means I’m not doing the work I’m supposed to be doing, so I have to do that later. So that’s what made me realize that unless I just want to sit at my desk and do the work, this is not where I want to be.
At the Forrest Firm, I was able to do all three. The way James had it set up, I didn’t make as much money, but there was no pressure on me to do anything in particular. I basically was being paid for what I did, so as long as I could survive, as long as I could get by for a while as I was building up my own book of business, I could make it work.
PM: You didn’t have to worry about billing as much.
JJ: Right, there was no one breathing down my neck. I don’t want to make it sound like it was so much easier; it was just different. If James asked me to do something, I could tell him hey, I’m sorry, I’m going to these five things this week, I can’t do that. I could not do that at Smith Anderson.
So anyway, that was a very nerve-wracking decision. My wife and I prayed about that a lot; we were nervous. I just felt like I’m going to have to do something like this at some point, so that might be the right time.
PM: You said you always wanted to start your own firm. Why?
JJ: I wouldn’t say I always wanted to start my own firm, but I have always wanted to start my own business. But the fact that I’m a lawyer, that’s basically what I know how to do, so that’s why I started a law firm.
My dad owned and sold a family business. Both of my grandfathers owned their own businesses. My grandfather on my mom’s side came here from Germany and he was a general contractor/builder and did that forever, he worked until he was in his 80s. I literally do not know anyone in my family that that didn’t own their own business. It’s just what I grew up with.
PM: How do you launch your own law firm? Do you need to raise money?
JJ: You need to have a little bit of money. But honestly it’s a pretty low bar in terms of cash outlay. You can do so much electronically and over the phone. Office space is not necessary, really, until you get to a certain point. Your overhead can literally be almost nothing. You’ve got to get someone to build you a website, do some marketing…
PM: Do you feel like starting your own business [he opened Fourscore Law in September, 2017] gave you any insight into the entrepreneurs you work with?
JJ: I think so. Though I sort of felt like it was my own business toward the end at the Forrest Firm. All the work I was doing was my own client base. But yeah, starting your own business for real, there’s just a lot of stuff you don’t think about. I was probably better equipped than a lot of people just because I’d been around so many things with startups, I could probably come up with a longer list of things I would have to deal with than somebody who hadn’t been around as long.
Still, take something like accounting—I knew I was not going to spend time doing that. So I had to find someone I could rely with to help me with that.
PM: Knowing how to delegate, that’s something you can talk to entrepreneurs about.
JJ: Right. By the end of last year, so four months in, I was already at the point where I was like, This is great, but I either need to figure out a different way to do this, or this is all this is ever going to be—because I am working way more than I want to right now.
PM: You’re coming up on the one-year anniversary?
JJ: We just passed it, September 1st. Thankfully even before [the end of last year] I knew a group of three or four lawyers that I had met from various places that were doing other things fulltime but wanted to do some of the type of work that I wanted to do. So pretty early on I was able to start delegating some of the work out, but it still had to go back through me, I had to check everything and make sure it was all right. So you’re limited; you can only do so much.
But one of the guys in particular really stood out and was really interested in doing more and more and more, so I hired him [Doug Colvard] fulltime in May and he’s been awesome. And it’s really opened up my time again to go back out and do some business development. We talked about that this morning actually—I did not really have a plan for the first year. It was, Just go out there and hopefully we’ll keep finding the work we need and everything will be fine. And that sort of worked, but I also realized I don’t want to do it that way any more. And now we have two fulltime lawyers and we have a paralegal who also helps with some administrative stuff who is probably going to be fulltime pretty soon.
It’s a little bit more serious; it’s not just me trying to make this work. I’m trying to figure that out right now because I don’t think we can get much further, again—just like after three or four months in we had to change or it wasn’t going to go any further than that. Now we’ve gone a year, and I think we have to figure out again how to make adjustments to continue growing to what we want to be.
PM: Is this something you hope to be a 10-lawyer firm, 20-lawyer firm? You don’t want to be a “big” firm.
JJ: We don’t want to be a big firm, right. That was one of the reasons—there was a lot that went into why I left Forrest Firm. That was also a very hard decision to make, but on an entirely different level. I wasn’t nervous at all, I knew that I would have plenty of work to do. The book of business was great. But it was really hard because James is a really good friend of mine, and so is Jeff.
But things change. We went from being a boutique corporate law firm with three lawyers, to 25 attorneys in all different kinds of capacities, with the goal of getting to 100. And I was like, I literally just left 100-person law firm, I don’t want to do that. You know? And so that was part of it.
So no, I don’t want to have a huge firm. But I also didn’t want to do it by myself. So I think in about five years, I’d eventually like to be about 12 to 15 lawyers. That’s where we’re headed, I think.
PM: And startups are the focus?
JJ: Yes. We might get a little bit broader. What I really want to focus on is venture financing and mergers and acquisitions, that’s the area where we want to grow. And then maybe general corporate counsel. We might add on, say, an employment lawyer, or a corporate lawyer that can also handle some employment stuff. One of our contract guys is actually a patent lawyer, but we’re not going to file patents. He does a lot of licensing agreements for us, some IP stuff.
So I can see us getting a little bit broader, but I don’t know if we would ever add, like, litigation or tax.
PM: But startups are still the focus?
JJ: That’s the idea.
PM: The right answer for our audience would be “yes.”
JJ: [laughs] Yes.