By: Rachel Landy (CLS Blue Sky Blog)
For almost four decades, scholars have been debating whether business lawyers provide value to transactions. The discussion began with a significant article by Professor Ronald Gilson. In the article, Gilson referred to business lawyers as “transaction cost engineers.” He argued that these engineers optimize the cost of a transaction by helping contracting parties find efficient ways to resolve negotiation stalemates. This way, they create more valuable deals.
Gilson’s theory gave us important insights into sophisticated corporate law practice, where outside lawyers are hired to make unique deals happen. However, the current literature does not explain how many business lawyers, particularly startup lawyers, operate. Startup lawyers can control the cost of their client’s eventual exit (for example, an acquisition or an initial public offering (IPO)) well before that transaction takes place. By doing this, they can influence the value of the startup itself. These lawyers are not just transaction cost engineers; they are exit engineers…
Featured News
T-Mobile Faces Class-Action Lawsuit Over Sprint Merger After Appeal Denied
May 16, 2024 by
CPI
Google Faces Backlash Over Introduction of AI-Generated Summaries in Searches
May 16, 2024 by
CPI
CMA Launches Phase 2 Probe into AlphaTheta’s Acquisition of Serato
May 16, 2024 by
CPI
NFL Executive Escapes Testifying in High-Stakes Trial Over Televised Games
May 16, 2024 by
CPI
EU Consumers Lodge Complaint Against Chinese Retailer Temu Over Content Rules Breach
May 16, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Ecosystems
May 9, 2024 by
CPI
Mapping Antitrust onto Digital Ecosystems
May 9, 2024 by
CPI
Ecosystems and Competition Law: A Law and Political Economy Approach
May 9, 2024 by
CPI
Ecosystem Theories of Harm: What is Beyond the Buzzword?
May 9, 2024 by
CPI
Open Ecosystems: Benefits, Challenges, and Implications for Antitrust
May 9, 2024 by
CPI