Can a startup accelerator give legal advice to the startups they help out without an in-house lawyer?

Chris Barsness, startup, finance, law, and tech nerd

Just like real estate agents will sometimes try to answer tax or legal questions, the accelerator is there to provide guidance, but they are not licensed to practice law.  In California, it is a misdemeanor to provide legal advice without being licensed.  It is also a misdemeanor to falsely advertise that someone may be able to provide legal advice without a license.  They can also be subject to civil penalties for unfair competition, in addition to the items listed in the other answers.  

Even if they have an in house lawyer, they are not a law firm and cannot provide legal advice to someone outside of that organization.

There are some grey areas.  For example, if they tell you that you need to form a C corporation in Delaware in order to go after VC funds, that may not necessarily be legal advice.  If they go on to explain the differences in legal entities, tax consequences, and tell you how to do it or give other advice that may have legal consequences, that crosses that line.  Their role is to provide guidance in the early stages, so there will be some advice that will probably border on legal advice.

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