Legal and Financial Advisor are Raising the Bar: Online Documents = Better Client Service

Jun 29, 2009 - by Joel Lessem

Being organized ultimately means less mistakes, getting the work done faster and providing superior service.  Whether it is completing a transaction,  structuring a businesses or managing a clinical trial are volumes of documents.   Having documents highly organized, accessible and online access reduces the voicemails, "lost" e-mail attachments and miscommunication that frustrates any collaborative process.  As one attorney commented

“My important clients use the internet for convenience with their other service providers. They bank online, they book travel online, they file taxes online - and I want to be able to provide them with a convenient way to work with me, online!  Either I proactively set up online access to key documents for my clients; or wait until they demand it because everyone else is doing it. And since there is virtually no material impact to my practice – why should I wait?”

Why Is Unlimited Use of Virtual Data Rooms so Beneficial?

Feb 11, 2010 - by Joel Lessem

It has always puzzled me as to why virtual data room providers charge per data room or per page or total number of users.  How can any company running a deal know exactly how many pages of documents they will have? Or how many users are going to access the deal room? 

Therefore, a buyer is unable to predict the final cost of the VDR. If they misjudge the amount of due diligence documentations or users, they can get stuck with a hefty bill. This type of “multi-line item” quoting is not designed with the customer in mind.

The other item I never understood is why the limitation on the number of deal rooms?  It’s not uncommon to have multiple data rooms for a single project.  More so, it’s the ability to start getting “deal ready” and exchanging documents early on in the mandate. Unlimited use also broadens the scope of use.

The Information Overload Dilemma

Feb 16, 2010 - by Nicole Black

Two weeks ago, thousands of attorneys and other legal professionals descended upon Manhattan to attend LegalTech New York, hoping to catch up on the latest legal technologies and innovations.

The annual LegalTech conference is sponsored by ALM with the goal of helping lawyers and law firms learn about the latest advances in legal-related technology. It features multiple educational tracks focused on a variety of legal technology issues, from ediscovery to knowledge management, cloud computing and social media.

One particularly interesting part of the conference was one the keynote presentations — “I3: The New Convergence of Intelligence, Intuition and Information” which featured a panel including Malcolm Gladwell (link to:http://www.gladwell.com/), the New York Times bestselling author of “Blink” and “Outliers”; Thomson Reuters Chief Strategy Officer David Craig and Dr. Lisa Sanders, New York Times Magazine Diagnosis Columnist and technical advisor to the television program “House, M.D.”

Defining Due Diligence

Feb 18, 2010 - by Aaron Booth

In the business world, Due Diligence refers to the act of investigating information related to people and businesses. This can be on a voluntary basis as in conducting a background check on a future employee, or it can be a legal requirement as in investigating the legal issues around a corporate takeover bid.  However, the most common type of Due Diligence performed in business typically relates to that which is performed in relation to a merger or acquisition (M&A).

The M&A process involves buyers and sellers of businesses connecting with other buyers and sellers to complete transactions that result in one business acquiring another or two business combining into one. For example, in a typical sell-side M&A deal, a seller put together a confidential information memorandum (CIM) and distributes that document to potential buyers.   When serious buyers are identified, letters of intent are signed and the seller shares additional information with the buyers.

This is the preliminary Due Diligence, and the point at which interested buyers investigate more detailed information to determine if they will submit a letter of intent to enter into a purchase and sale agreement and close the transaction. Once a final buyer has been identified, the real Due Diligence begins. It is at this point that the potential buy and seller have agreed to share all information related to the business so that the buyer can investigate the financial statements, tax returns, inventory, fixed assets etc. in an effort to verify their understanding of the state of the business and to finalize a purchase price. In some instances, Due Diligence has been described as a process in which buyers look for reasons to reduce their risk and lower the purchase price prior to the close of a transaction.

Alternatives to Expensive and Time-Consuming Air Travel

Feb 23, 2010 - by Nicole Black

Let’s face it, these days, business air travel is a costly proposition—it’s expensive and takes up valuable time.

And, travel time is only increasing due to the recent attempted terror attack, as widely reported in the press.  For example, as explained in a recent Montreal Gazette article:

Massive lines, flight delays and cancellations greeted Canadian passengers traveling to the United States on Sunday as new security measures moved into a second day and another suspicious incident was reported on board a U.S. flight, increasing tensions.

Weather delays aren’t helping matters either, now that we’re in the midst of a long, cold winter, as detailed in this Chicago Sun Times article:

A messy winter storm — which could bring up to a foot of snow…— caused major headaches for travelers…prompting more than 500 flight cancellations at  both city airports.

One way businesses can avoid the time suck of costly air travel is to utilize innovative alternatives to face-to-face business meetings, such as video conferencing, screen sharing and online document sharing.

Encrypted Client Communications—the Wave of the Future

Mar 2, 2010 - by Nicole Black

Email security in its current form is inherently flawed and many lawyers are unaware of this disconcerting fact. Most emails are no more than mere postcards, the contents readily viewable by anyone who cares to look.

As each email travels from its starting point to its end destination, it traverses an untold number of servers and can be intercepted and viewed by virtually anyone with the proper technological know-how and desire.  A number of states, including Massachusetts and Nevada, already have passed laws or regulations requiring certain types of confidential data to be sent electronically only via encrypted communications. More laws of that nature most certainly will follow, both at the state and federal level.

In my opinion, encryption laws — most of which currently apply primarily to financial institutions — ultimately will incorporate some of the types of client information contained in attorney-client communications, in large part because of rising concerns due to recent large-scale data disclosures.

Virtual Data Rooms: Unlimited-Use Closes Deals Fast

Mar 4, 2010 - by Joel Lessem

In any deal, time is risk.  The longer it takes to close a deal, the greater the potential for the transaction to get derailed.  Being prepared ahead of time is one way to avoid time delays and risk.

Firmex’s unlimited use virtual data room broadens the range of use investment banks have for their data rooms exponentially: they can collect information to develop and circulate CIMs when marketing transactions and have their client prepare diligence information early. When the LOI is signed, diligence documentation is available and valuable deal momentum is maintained.

Shopping for virtual data rooms at the 11^th hour adds unnecessary risk to maintaining momentum and effectually closing the deal. In some cases our clients may be running multiple transactions as part of one deal (eg.debt refinancing, 3^rd party valuations, selling certain assets etc.). With Firmex, clients can startup additional data rooms to coordinate and manage related transactions at no additional cost or delay.

Firmex charges a flat subscription fee for unlimited data rooms at the same cost as a single data room from an alternative data room provider. The M&A advisory firm can set up and maintain control over all their active mandates, have cost certainty for their clients, and get deals organized ahead of time to avoid delays in the M&A process.

Virtual Data Rooms Offer a Secure Alternative to Email

Mar 9, 2010 - by Nicole Black

As discussed last week, the unencrypted email systems used by most law firms are inherently insecure and place confidential client data at risk.

However, there are secure alternatives to email, using cloud computing products, like Firmex online document workspace, that incorporate some form of encrypted client communication into their platforms. These cloud computing platforms provide lawyers with a ready-made solution to the problem of unencrypted, insecure email.

There are a number of products available that allow attorneys to securely exchange large volumes of confidential documents and information with opposing counsel, clients and others. For example, law firms can use secure virtual data rooms such as those provided by Firmex,  to collaborate and communicate with other users, manage online due diligence, exchange closing drafts, create digital record books, share litigation documents, and secure client access to important files.

Cloud Computing Industry Reaches New Heights in Design

Mar 11, 2010 - by Robert Wilder

Ad agencies and design firms, as creative shops, have always used the design of their spaces to inspire their employees to creative heights. But, really, it’s in every business owner’s interest, no matter what industry, to build an employee environment that invites creativity and productivity.

Firmex’s software engineers, busily developing hyper-secure code that drives millions of mission-critical documents that are accessed by 10,000s of users every month, should be treated to a space that is as dynamic as their work in the SaaS industry. Also, a large portion of our business as a data room provider is devoted to making our clients happy, with an in-house client services staff working 24/7 to help people with transactions valued in the billions of dollars every month. Happy employees mean happy customers, and a happy employee begins with a great work environment - that’s why I decided to design a new office that was both practical and aesthetically pleasing.

Although I had a brief two months to complete the project with my designer, I knew what I wanted: a simple space, full of natural light, that wouldn’t be overdesigned to the point of distraction.  I wanted the new space to act as a simple canvas for expression. The space itself was inspiring – great views, high ceilings and columns that reminded me of the Frank Lloyd Wright-designed SC Johnson building.

How Safe are the Documents in your Office?

Apr 29, 2010 - by Joel Lessem

Firmex is in the business of providing M&A advisors, lawyers and corporate executive staff a secure online data room for sharing critical operational, legal and financial documents with 3^rd parties.  Not surprisingly, as the company's CEO, I run into resistance from senior partners and executives about putting critical and highly confidential company information on the Internet.   They are worried that it’s “not safe.”

 Meanwhile around the advisors’ offices are file folders of confidential documents on shelves, on chairs, organized in piles on the floor!  Somehow they are ‘safer’ scattered around an unlocked office.  Recently, a group of lawyers were convicted for trading insider information which was gleaned from picking through other lawyers’ client documents. Below is an excerpt from the story:

First at Sullivan & Cromwell in the United States and later at Dorsey & Whitney in Toronto, Mr. Cornblum used a practice he called "spelunking" to gather information, which involved showing up at work in the early hours of the morning and wandering the halls and offices of other lawyers in search of documents inadvertently left on desks and in photocopiers.  [Read More]