GRAND RAPIDS — More than seven years, $2 million and 500 companies later, Varnum LLP signed on for a third round of providing free legal services to help new companies get off the ground.
The Grand Rapids-based law firm will give away another $1 million in legal services through the MiSpringboard program that launched in 2011 under a push by then-Gov. Rick Snyder to support entrepreneurism as Michigan’s economy began recovering from the Great Recession.
Believing MiSpringboard has achieved its goals, Varnum committed to a second round of $1 million in 2016, and decided earlier this year to do a third round and continue working with startup companies at their earliest phases.
“We really like being in this space. We feel it’s making an impact in the economy and it’s growing the entrepreneurial community in the state, and it’s fun to work with these clients,” said Eric Post, a business and corporate attorney at Varnum who works with startups through MiSpringboard.
“Entrepreneurs in Springboard have an enthusiasm and an energy that’s contagious, and it’s exciting to learn about their new ideas and technologies,” Post said. “You kind of get caught up in their excitement for the product or the service.”
Varnum partners on MiSpringboard with dozens of organizations throughout Michigan, often getting referrals of entrepreneurs starting new businesses from organizations such as Lakeshore Advantage in Holland and Start Garden in Grand Rapids. If accepted into the program by a review committee, startups get a minimum of $2,500 in free legal services.
Attorneys can recommend a startup receive more services than the minimum, said Post, adding that some promising participants have received $10,000 to $15,000 in free legal services.
The review committee generally looks for startups that have an innovation and the potential for job growth, Post said.
Many are technology-based businesses, including software companies and mobile app developers, or are involved in biomedical research and electronics. Others come from industries such as transportation, retail, tutoring and food processing.
“We want a company that’s going to help the region, generally,” Post said.
Legal work for startups in MiSpringboard typically involves the early basics of starting a company, including setting up the corporate structure, drafting articles of incorporation or partnership agreements and advising on protecting intellectual property. Varnum attorneys also have assisted companies preparing to raise capital.
Attorneys involved in MiSpringboard hold office hours at business incubators and co-working spaces around the state and work with various SmartZones and economic development groups. They often introduce startup clients to their professional contacts for further assistance.
“We have a big network out there among the universities, the accelerators, the tech transfer offices,” said attorney Rick Manczak, a partner at Varnum who works with venture capital and private equity funds. “We’re able to help people get plugged into the right resources fairly quickly.”
Varnum attorneys worked early on with Grand Rapids-based BAMF Health LLC to create a corporate entity and structure that involves five unique and interconnected business units.
In the new era of personalized medicine, BAMF Health wants to move radiopharmaceuticals — a radioactive compound used for diagnostics and therapies — from the research lab to commercial use for molecular imaging.
The technology can see molecular activity in the human body, enabling the earlier detection of cancer, neurological and cardiovascular diseases and other illnesses. That results in targeting a treatment sooner without patients first going through the trial and error of trying to identify which drug works best for them and their conditions.
Anthony Chang, a molecular imaging scientist who founded BAMF Health, needed legal work and advice on setting up the business in August 2016. He worked with Varnum attorney Zachary Meyer, a member of the firm’s business and corporate services practice.
Chang left academia to start the company. At the time, he said he had “no idea” what legal work he needed to do.
“I’m a scientist. I have no idea about business, I didn’t know about finance, I don’t know legal. I just know there’s a lot of legal foundation to lay out,” said Chang, who was introduced to MiSpringboard by a friend who is a partner at Varnum.
After learning about the technology and the company’s direction, Meyer helped Chang understand what legal work was needed to launch the company and establish a foundation for the future. Participating in MiSpringboard “helped the company dramatically,” said Chang, who specifically credits the law firm with moving quickly to get the company going.
“In the startup world, especially tech startup, speed is everything,” Chang said.
Formerly known as ReThink Imaging LLC and housed today in the Secchia Center on the downtown campus of Michigan State University’s College of Human Medicine, BAMF Health intends to target its technology at the global market, Chang said.
Since those early days, BAMF Health has become a paying client for Varnum.
The law firm has worked on intellectual property and trademark issues and now is performing legal work to prepare the company to raise a Series A capital round, including tailoring a term sheet, said Chang, noting that BAMF Health is “not a conventional company. We are doing something nobody has done before.”
Varnum counts BAMF Health among the one-third of MiSpringboard participants since 2011 that went on to become paying clients, Post said.
Companies are required to eventually become clients of Varnum to earn entry into the program.