Bootstrap Legal's Robo-Attorney Slashes Costs and Time for Real Estate Crowdfunding/Syndication Offerings.
Firm claims that attorney-grade contracts are created 2x - 5x cheaper and in just 48 hours
July 25, 2017 BY IAN IPPOLITO
(Usual disclaimer: I’m just an investor expressing my own personal opinion and not a financial advisor. Consult your own financial advisor before making any investment decisions).
Creating a crowdfunding/syndication offering is expensive. A typical law firm will require a hefty $2000-$5000 upfront retainer, and then bill by the hour. By the time they're done, they typically rack up a $10,000-$25,000 bill for a $1 million raise. Most entrepreneurs/sponsors with smaller projects, simply can't afford these costs. So most smaller projects never get off the ground. This is a loss for them, investors and the industry.
So I was very interested to learn that a company called Bootstrap Legal has taken a novel approach to solve this problem. They've slashed the cost of creating attorney-grade contracts, by creating an artificial intelligence engine that automates the repetitive work required to draft the paperwork. This lets them charge a fraction of the price, and avoid the hassle of a retainer and uncertainty of billing by the hour. The total cost is just $5000-$7500, which is 2x-5x cheaper.
The sponsor answers several pages of questions about the deal and sends them to the company. The software does all the heavy lifting, and then a human attorney reviews it before giving it to the customer. And instead of waiting weeks, the sponsor gets their documents back in just 48 hours.
The company was founded by Amy Wan, a prominent attorney in the crowdfunding industry and former General Counsel at Patch of Land. Wan says "The legal fees for small transactions are often too high for small deals. Bootstrap Legal aims to solve a lot of problems my clients have had over the years.”
If Bootstrap Legal is successful, not only will sponsors be happier, but investors may soon have a lot more alternatives to choose from.
Ian Ippolito is an investor and serial entrepreneur. He has been interviewed by the Wall Street Journal, Business Week, Forbes, TIME, Fast Company, TechCrunch, CBS News, FOX News and more.
Ian was impressed by the potential of real estate crowdfunding, but frustrated by the lack of quality site reviews and investment analysis. He created The Real Estate Crowdfunding Review to fill that gap.