Calfee, Halter & Griswold (Calfee) is full-service, corporate law firm with three offices in Ohio and one in Washington D.C. with more than 115 years of experience providing legal counsel. The Cincinnati office opened in 2011 and serves both publicly-held clients and private, family-owned businesses, as well as nonprofits and individuals across the region. Calfee is active in the area’s entrepreneurial community and is a sponsor of QCA. Recently, The Halo Effect caught up with Michael Hurley, partner at Calfee with a focus on helping startups access capital through angel and venture-funding.
T.H.E.: What made Calfee want to partner with QCA?
Hurley: QCA is the other side of the coin for what we do at Calfee. They are a great supplement to the legal advice that we provide to entrepreneurs. We work together symbiotically to prepare these people as best we can to have a successful startup experience. While we overlap minimally, QCA provides insight into other areas like accounting, business evaluation modeling, and what’s important to investors on the economic side to show how the capital they provide is being deployed. It is areas like these that are not in my wheelhouse that QCA brings to the table. In addition to that, QCA is a well-regarded brand, very involved in the community, and they do a lot to push not just their own agenda, but the agenda of the larger startup community. With their track record and history of success, it’s our honor that they want us to be part of growing that ecosystem.
T.H.E.: Why is it important for Calfee to be involved in the Cincinnati startup community?
Hurley: We’ve only been in Cincinnati since 2011. Specific to this office, we like to think we have a lot of similarities with some of our entrepreneurial clients. We are a new entrant into the market, delivering disruptive services in certain ways that are beneficial to making sure the legal community is on top of its own game in supporting the business community. Specific to Calfee’s role and how we intertwine with the entrepreneurial community, the people and businesses that comprise the community are what ensures the vitality of the larger business community. Without them, the more mature business community won’t exist for long. They are the necessary pipeline of new market entrants, new ideas, and people that is the lifeblood of the system. We take a long-term approach in many things, especially with our clients. Looking down the road, my biggest point of pride would be to say that I helped someone start a business in 2019, and they are still a Calfee client generating significant revenue, employing hundreds of people in the Cincinnati community and staying involved in doing great things for the region.
T.H.E. Tell us about your Instructional Toolkit
Hurley: The startup toolkit is a labor of love that has been developed by myself and my colleagues during the last several years. At Calfee, we create the structure that helps entrepreneurs institute the processes that help them achieve business objectives. The toolkit covers potential legal structures of entities, funding rounds, equity and debt investments, etc. It fleshes out discussions on a high-level regarding what entrepreneurs need to do to structure their internal and external legal relationships and helps them understand the correct equity/governance documents. There are 10-15 types of relationships that as an entrepreneur you want to make sure you structure correctly from the outset, and the toolkit makes sure they develop all of them the right way.
T.H.E.: Describe your team at Calfee
Hurley: Our Cincinnati office includes attorneys experienced in labor and employment, privacy and data security, intellectual property, corporate and securities transactions and business disputes. This overlays nicely with the immediate needs of startups. In addition to the people on the ground here, we have approximately 160 attorneys firm-wide that provide all other support that we need that may be outside the sweet spot of our Cincinnati staff. We have an overlay of team members that speaks to the needs of entrepreneurs and startups, and we consciously built our team around the concepts and needs of such clients.
T.H.E.: What would you say makes Calfee stand out from other firms?
Hurley: The willingness to take time to invest in our clients. To understand what they are trying to achieve and then working with them, with a long-term approach, to address those needs. Regarding startups, a lot of it is about triage. We are a cost center to them. We impact their runway to get to market and grow. We are very cognizant that every dollar they spend on legal is a dollar they can’t spend on bringing a product or service to market. We’ll take the time to create a solution that works for them rather than throwing form docs at them for a set fee without any kind of personalization because we are not trying to lose money on the front end or for any other reason that you don’t provide the full level of service at the outset. There is one thing I try to do with every client that has an idea for a startup: I tell them to put the legal questions aside, and before we do anything, talk to me as if I were a potential customer or a potential investor. Tell me what you are trying to achieve, how you are satisfying a market need and what you are going to do to develop and deliver on that proposition. Through that mechanism, I can usually tease out a lot of the questions and answers that I need to personalize the initial corporate governance and other documents that they will need.
T.H.E.: Why do you think Cincinnati is the place to start a business?
Hurley: I wrote my college thesis on the city. I love my hometown. It’s a fascinating story. We grew up as a ramshackle river town and have always historically punched above our weight in terms of the business community. We still have a lot of solid Fortune 500 companies, and we have great ecosystem in general to foster people who want to be successful. An integral part of that is not just legal and business support but having a place to do things when you are not in the office. The types of amenities this city offers for its size are unparalleled. There are a lot of ways that this city can be attractive to someone who wants to start a business. More important, when you are living on a shoestring budget as a startup, the cost of living in Cincinnati is probably a lot more attractive to someone choosing between groceries and paying a vendor than the Bay Area. Accessibility to great legal services, large companies that can provide guidance and support, professionals that have come out of them – it’s a perfect mixture.
T.H.E.: What can the area do to improve and what are we doing right?
Hurley: What I think we can do to improve is getting our message out to potential transplants to come and start their businesses in our city. We are starting to see the genesis of that and starting to see Cincinnati creeping up on lists of places to live and run a business. I think we need to continue to deliver that message outside of our market. Hopefully that will create a groundswell movement where we have people coming in from outside the market, maybe from more mature startup markets, who can then inject all their knowledge and experience from previous lives.
As far as what is unique or beneficial to the city, especially in the last 10 years, is the spread of cultural acceptance around startups. I see and feel more people willing to forego the job with benefits at a large corporation to strike out on their own and make it. I think that is a direct result of the support provided to date. FC Cincinnati didn’t exist a few years ago. A few local business people decided they had this dream, and they wanted to make it work. FC played their first MLS home game recently. They are the perfectly allegory for what I would like to see in the startup community. We need to do everything that we can to get into the major league for supporting our entrepreneurs.
CINCINNATI – March 11, 2021 – Queen City Angels today announced additional capital secured from the Ohio Third Frontier Pre-Seed Program and the Ohio launch of its $15 million QCA First Fund VI (FFVI), the sixth in a family of funds and the largest fund in the group’s history. FFVI includes more than $10 million in private funds from QCA members and $3.5 million matched funds from the Ohio Third Frontier Pre-Seed Program. The Ohio Third Frontier Commission approved $70.5M in non-recourse loans to be awarded to 14 Ohio-based funds. QCA was the first angel group recipient and among the first overall recipients of Third Frontier funds dating back to 2003. Tony Shipley, founder of QCA, and John Habbert, director of QCA, will manage FFVI.
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