Welcome to Networking Unleashed, Building Profitable
Connections, the show where smart conversations
protect your business and help it grow. I'm your
host, Michael Forman, and today we're tackling
a side of networking most people ignore until
it costs them. We all love making, we're all
talking about connections, collaborations, and
opportunities, but what happens after the handshake?
what's real, what's risky, and what actually
needs to be in place when relationships start
turning into revenue. My guest today lives at
the crossroads of law, business, and AI. He helps
entrepreneurs, startups, and growing companies
build relationships the right way without stepping
into legal landmines or misusing powerful tools
like AI. If you're building partnerships, Using
AI in your business or networking your way into
your next opportunity, this episode will help
you connect smarter, move faster, and protect
what you're building. I'd like to welcome to
the podcast, Matthew. Matthew, I really am excited
for this podcast because I'm very interested
in what you have to say. Would you mind introducing
yourself and how you got here today? Sure. Thank
you for having me, Michael. My name is Matthew
Finaro. I'm a business law attorney. I'm in Coral
Springs, Florida. I've been an attorney for 23
years. My practice focuses on helping small businesses,
entrepreneurs, and startups with their various
legal issues, whether it's litigation or transaction.
I got into this space by starting out when I
was practicing law. I started out working for
a boutique firm and then two Amla 200 law firms
and I focused on predominantly commercial litigation,
working for big companies, banks and insurance
companies. And then about 11 years ago, I had
the opportunity to work for an even bigger law
firm or pivot and do something else. So I went
through a lot of thought and internal soul searching,
spoke to my wife, spoke to my family. And I decided
that I wanted to go out and start my own law
firm. And then I figured out in what my mantra
or my focus would be helping the small businesses
that I felt were underserved by bigger law firms
and underserved by local law firms here out in
the suburbs and non -metro areas. So that's how
I decided to focus on helping small businesses,
entrepreneurs and startups. And that's what I've
been doing for the last 11 years. What I am here
today for. That sounds great. It sounds the typical
attorney. I worked for an attorney for about
four or five years. I was a director of sales
and marketing and brought them from a single.
Single shop to four states twice. I've seen the
growth, but I also saw how the small businesses.
The attorneys really didn't react to or really
didn't want. to go behind because I don't know
if there was enough money or whatever the case
may be, but these were left out in the loop.
So I'm very interested to have you on and see
what you're all about. From a legal standpoint,
what are the most common mistakes entrepreneurs
make when forming partnerships or collaborations
through networking? Sure, the common mistakes,
a pretty common mistake. The entrepreneurs or
the business people, the founders, whatever you
want to call them, are always very eager to get
into business and want to start their business
and do a good job and everything. So they overstep
and step past some very basic steps to just get
into business and start doing business. So what
they miss out on is they don't do a written business
plan. Before they even start their business which
is a necessity in the written business plan tells
you all about what your business is going to
be what kind of structure is going to be who
what when where why how about your business how
you gonna spend money make money hire people
fire people bring on people. Get rid of people
lease property habit website all that stuff is
in your business plan on people just skip over
that step then the next step they skip over.
is the next set of documents and papers that
you need are your governing documents for your
business organization. And this will also get
into step three of what a lot of people miss
out on is that people are so excited to get into
business and start up that they just go, for
instance, I'm here in Florida, you can go online
to our secretary of state website and just kind
of mess around and register your business like
within five minutes and then. It gets approved
like a couple of business days later and it's
official and they think that's all that's required.
So they don't really draft or have the operating
agreement. If it's an LLC, the partnership agreement,
if it's a partnership, the articles have been
corporation or the bylaws. If it's a corporation,
they just go online. They're like, Hey, the state
took it. I'm in business. And so that's the second
thing they miss is all those governing documents.
And the third thing they miss that kind of ties
back into. The first two is that. They miss collaborating
with professionals who are there to help their
business from before the start of the business
to the life of the residence and that includes
people like myself as a business law attorney
an accountant commercial banker. You know depending
on what your business is like a commercial real
estate agent or someone who's into SEO or internet
stuff or technology stuff. So they try to take
on the entrepreneur, the founder, whatever, tries
to take on too much responsibility to themselves
and don't understand that it's a necessity, not
a luxury to have your group of professionals
who call upon for their advice in their council
to help you out. And they just try to do everything
themselves and they do everything with whoever
they're in business with. And they try to do
their best, but sometimes they make mistakes.
And it starts even before they start up, they
pick the wrong business organization and they
pick the wrong, wrong contracts to enter into
or whatever, the wrong lease to enter into, the
wrong services agreement to enter into. And then
they have all the best intentions and everything,
but they're on the road to things not turning
out well because they took a few missteps at
the beginning. And that's probably the three
biggest areas in common. are the three most common
areas of mistakes that businesses make in their
startup cycle. It sounds, if you follow what
you just said and you don't be penny wise, dollar
foolish, you should really just, I've been in
multiple businesses. I've had brick and mortar
businesses. I've had virtual businesses. I've
been the employee while I've had businesses.
And I learned early on. get yourself a good attorney,
get yourself a good accountant, get a business
plan in place, and then start your business.
So you have to get all those. So you have to
pay a little bit to get in the right sphere,
but you'll be thankful for it every year afterwards.
Correct. And it's not just preventative maintenance.
It's necessary because Little things that you
can do at the inception are very preventative
and proactive that prevent catastrophic huge
issues from happening later on in your business,
whether your business is successful or it's unsuccessful.
You need all those steps and you need to interact
with those professionals and stuff to avoid future
issues, whether you're successful or not, because
issues are going to arise. As I have found out
multiple times, so I understand that completely.
When business relationships move fast, where
do you see handshake agreements quietly turning
into legal problems later on? The issue is that
any handshake agreement can turn into a legal
problem, not just fast, slow, medium. It just
happens over time. So everyone who goes into
business obviously has the best intentions and
wants to succeed. Everyone who goes into business
with someone or something else obviously wants
the best and wants to succeed. But sometimes
things happen, whether it's good things or bad
things, adversity hits your business and your
handshake isn't going to cut it when you're faced
with a lawsuit, when you're faced with like an
IRS investigation issue, whether you're faced
with some kind of EEOC employment claim or something
like that. All of a sudden, the person who you're
a buddy with or whatever in your business, all
of a sudden, there's cracks in the relationship,
there's issues that can happen. So you always
want to reduce your relationship with anyone
or anything in business into writing in the form
of a contract, no matter how In substantial you
think it is it has to be in writing because if
it's not in writing it doesn't exist and it's
he said she said at that point and Your memory
and their memory are going to be different particularly
when there's liability involved or when you're
apportioning fault So that's why you know, even
though you start out with the best of intentions.
You don't want to have adversity You don't want
to fail. You don't want things for everyone's
protection, for your protection, for the other
person's protection, and then most of it only
for the business's protection, you want to have
a contract that's in writing, that's clear, that
says what the relationships between the parties
are, how everything happens, and if there's a
dispute, what happens. Yeah, I usually, when
I went into a contract with a friend of mine,
we wrote the contract out, we put it in the safe,
and we left it there. until there's a problem.
Then we can always refer back to it. But I always
felt that the best thing was to put everything
on paper and we can put it away, put it to safe.
We don't have to look at it again, but put it
all on paper in case anything should happen.
So that's the way that I always thought about
it. How should entrepreneurs think differently
about trust in networking while protecting themselves
legally? But it goes back to a little bit of
what I just said. You want to make sure everything's
in writing. So when you're networking with people
and they want to either build business relationships
with them or referral relationships or whatever,
you want to make sure that if it's a official
legal relationship, you have it in writing. So
if you're networking with someone and you want
to use them as a vendor or you want them to use
your services or your products, if it's... Official
relationships you want to make sure you have
a contract with just a networking kind of relationship
or relationship. You're fine just doing course
of business but make sure that if you're. Doing
something where it's like you get a referral
fee or your co fees is like a co party or whatever
that needs to be in writing because. Again, if
it's not in writing, it doesn't exist. So it's,
he said, she said, so you just want to make sure
when you're networking or you're developing your
business that it goes back. If you're in a business
relationship, you want to make sure it's in writing
so that there's no discrepancies and there's
no dispute as to what people are supposed to
do or what businesses are supposed to do, not
do, and then how things are resolved if there
is an issue. Absolutely. Absolutely. What legal
conversation should happen early in a relationship,
even when everyone feels aligned and optimistic?
Sure. You got to talk about what, you know, you
got to talk about the foundation of your business,
the direction of your business, how it's going
to run. It's all the things that go, that start
out in your written business plan. You need to
have discussions about everything that's in there
so that you have a cohesive written business
plan and then when you go to the next step. Make
sure that you have a cohesive set of governing
documents for your business once it started and
then make sure when you go to the next step,
you have your open and very transparent and honest
conversations. with your professionals who help
you to figure out what the best legal structure
is, what contracts you need, what agreements
you need. And then on the tax side, what business
organization you should be from a tax perspective,
because if you're one kind of organization, you
should have been another, you're going to get
killed on your taxes. And then from a banking
perspective, what kind, do you need to borrow
money? Do you have money? Who's contributing
money? How are they going to contribute money?
Are you going to have a checking account? Are
you going to have a merchant services account?
What are you going to do with it? So those are
all conversations that need to take place even
before the foundation of your business, but especially
during the foundation of your business, because
it's going to dictate how things turn out afterwards.
Absolutely. Absolutely. As you're speaking, I'm
just thinking back of all the businesses and
the partners and all the documents that I had,
I was safe. filled with documents, and each one
was from a different business, from a different
year. I understand everything that you're saying.
AI is changing how professionals connect. What
new legal risks are emerging from AI -driven
outreach, contracts, and communication? Sure.
So, you know, one of the things with AI is I'm
very into AI, both in the practice of law and
the actual running and development of my business.
But the first thing I always say is that I'm
in charge. The buck stops with me. I'm at the
top of the pyramid, whatever metaphor you want
to use. I make sure that I review that and approve
every single AI created thing. that is attributed
to my business. And that's what the main issue
is with AI is that people just take it for face
value and put it out there without properly vetting
it or properly researching it or properly making
sure that it's correct because they just think
that AI is probably correct. And then that's
where people in businesses get into huge issues.
And I can tell you from a legal standpoint, from
an attorney standpoint, there's a lot of attorneys
who just go with the flow and use AI for legal
research or legal drafting. And they don't do
it responsibly. They don't review the work product.
They don't confirm the case in a rule of citations
and law citations. They just take it and throw
it out there. And they get in major trouble in
litigation, they can trouble with courts, with
bar associations and things like that. And then
with other parties or other clients or whatever,
the work products, if it's like from a transactional
standpoint, may not be correct. And they're going
to get major issues from that point. For lay
people, let's say, just the average business
person or whatever, it's just like the same issues
when you for the last 25, 26 now plus years of
just using Google, doing a Google search, looking
for a document. You're gonna find a document,
but you don't know if it's right or wrong or
if it's correct or incorrect or if it applies
or not, because you're not the subject matter
expert. You're just the lay person who's taking
what you found on the internet. And all AI does
is takes that to another level and another crescendo
of A much more refined cohesive product that
you pull off of the internet that you don't know
if it's right or wrong or if it applies or not
or what the consequences are. And business people
just throw around contracts that they get off
AI business people throw out research that they
get off of AI because I guess. They're trying
to do it yourself and save money or save time
and the issue is is just like with everything
else you get what you pay for. and you're putting
out material that could be right or could be
wrong. And if it's right, great, you dodged a
bullet, but if it's wrong, it's gonna be catastrophic
because there's major consequences if you're
putting out a contract there that, you know,
doesn't have what it needs in it or actually
has the wrong stuff in it, or material like soliciting
material, whatever, just you don't know what's
right or wrong because you don't know what you
don't know. So obviously AI is probably the most
significant technological change to come along,
maybe ever, who knows at this point, because
it's limitless potential, limitless productivity,
limitless time saving, limitless force multiplier.
But with anything, you have to take responsibility
and ownership of it. And a lot of entrepreneurs,
a lot of business owners, whenever, like I said,
are just throwing stuff out there that they get
from various AI platforms, not just general platforms
like ChatGBT or something like that, but specialized
platforms too, that they don't know what they're
putting out there. So obviously I encourage people
to use AI. It's a godsend as far as running your
business and doing things. They can do things
that are just revolutionary, that are time saving,
that are resource optimizing and force multiplying
and all those cliches or metaphors you want to
use. But you have to make sure that you take
responsibility and ownership over it. because
you're responsible for what you're putting out
there. Whether the AI made it or not, it's your
name on it and it's your thing and it applies
to all industries. I encourage people to use
AI. I just encourage people to use it responsibly,
which is what the issue is that people aren't
using it responsibly. They just take it for face
value and put it out there. They always said
that everything that's online, if it's online,
it must be true. Right? Because everything online
is factual. It's 100 % correct. Now you and I
both know that's not true and that you really
have to be careful what you read online. But
chat GPT takes all of its information from online.
Right? So it brings all this information together
for you, but it may be putting together something
that is erroneous. So it may save you time in
collecting all this information, but you have
to do your due diligence and you have to trust
it, but verify everything that's in there. So
you're not back to square one because you got
all the information, but you have to verify everything
that you get. Correct. And then also another
thing with the AI is that it's biased because
it wants to get you the right answer. It wants
to get you what you're looking for. So it's going
to try to engineer the data and the information
it gets to make it appear like it's what you
want. And there's a big, not just misinformation
issue, but there's a big bias issue because if
you frame your prompts in a certain way, you
can essentially get whatever answer you're looking
for because it'll find exceptions or it'll find
whatever, and then it'll frame it as something
that stands for something that's not the actual
proposition. So another big thing about AI that
I should have mentioned is that the prompts that
you generate are probably the most important
thing that you can do because it establishes
your guardrails and establishes what goes on
with the AI. Absolutely. I was going to bring
it up because you didn't bring it up until the
very end. I was going to say garbage in is garbage
out. You have to really put your prompts together
properly. What it takes to put the prompts together,
you may ask a question. depending on the answer,
you'll have to revise that prompt like two, three,
four times until you get to the, what you're
actually after. So you have to really have to
drill down and figure out, you can't just talk
about emails. He has a make my email better.
That's everything you have to really, when you're
trying to create a slide, you have to tell him
act as a. whatever, an event planner or a design
manager for 15 years and that you want to create
a slide for X, we have to really get down into
it. I've done a lot with AI, if you can tell,
but I trust, but I verify. No, I do too. And
so should everyone. Everybody should. That's
first and foremost. How can business owners use
AI to strengthen relationships and operations
without crossing ethical or legal lines? Sure,
you can be much more productive and proactive
doing things with AI and it becomes easier every
day because there's more and more specific AI
tools out there to help you strengthen your business
relationships and things like that, and he just
pointed out there's so many AI programs, apps,
bots, whatever you want to call them, websites
that help you do things like help your social
media, help your internet marketing, help your
email campaigns, help your visibility, help you
do business planning and execution. So those
are all out there to help you. And it's the same
adage. You can use them. I use some of them.
Like I said, on the business side of my business,
but like I said, the buck stops with me and I
need to take ultimate responsibility for that
stuff. And it's a very time saving. It's very
resource rich and it helps a lot of things, but
you got to make sure that you're in charge of
it and don't be afraid to use it, but don't cavalierly
use it and just, I'll just see what happens or
you got to make sure you're in charge of it.
But It can totally revolutionize your interactivity
with other people and other businesses because
you can just put in your whatever your thoughts
or whatever and then it'll send out social media.
It'll send out email contacts. It'll send out
virtually anything you need to maintain business
relationships and further develop those. Correct.
Very good. Should entrepreneurs know about ownership?
data and confidentiality when AI tools are involved
in collaborations? Sure. And the easiest thing
to remember is that anything, unless it's unequivocally
specified in your particular AI program, and
it will be the first thing that it tells you
about itself, that your data is secure, which
is very few AI platforms and very few AI apps
and very few AI bots, most of it's unsecured.
So you need to act as if you're handing your
confidential data and your personal information
or whatever, you're handing it to a third party.
And it's just as if you were to hand it to someone
off the street and ask them to put it together
and hand it back to you. You've lost confidentiality,
you've lost exclusivity, you've lost everything.
So the rule of thumb is don't put that Into the
a i keep that confidential information people's
personal contact information or sales figures
or information that you want to keep secret that
you don't want out there so i'm not gonna get
leaked if you put it in a but legally speaking
you've given it to a non confidential third party
so now it's out there so don't put it out there
don't. use the AI to do things with confidential
information. Use it for non -confidential information
and then take it. And then if you want, put the
confidential information in it yourself if you
need to have that in there. If not, just don't
do it. And that's probably the easiest way to
avoid dealing with confidential information issues
or confidential data or business processes or
trade secrets or whatever it is you want to characterize
it as. Absolutely. Absolutely. You've seen both
startups and established businesses grow through
networks? What legal foundation must be in place
before growth accelerates? It goes back to the
first thing we're talking about, making sure
you have all your documents in place and your
governing documents and your business processes
and everything, but you want to also make sure
that you have a culture to your business or a
mantra to your business that you uniformly and
objectively conduct your business in a straightforward
and transparent manner and that you follow all
the laws and rules and that you uniformly do
that because if you don't do that, you're gonna
maybe run into issues later on down the road
because if you don't always comply with business
formalities then you're going to run into a problem
when you didn't do your annual report or you
didn't have an annual corporate meeting or you
didn't do something with your taxes or whatever.
So you always want to make sure that in addition
to all your basic documents and everything that
you're comporting yourself in compliance with
rules and laws and just norms regarding business
and don't vary or don't swerve off of that, that
platform. Because if you do, you're going to
run into problems because if you don't uniformly
do things, you don't objectively do things. Then,
you know, the time that you didn't do it or whatever
is going to become an issue because it could
be a major hurdle down the road or it could explode
into a very bad situation. Okay. So how can professionals
Spot red flags during networking conversations
that signal future legal or financial trouble
Sure, so when you're networking with someone
or a business organization or whatever Obviously
if they make specific outcome guarantees or promise
things or whatever It needs to be in writing
and it needs to be substantiated. And not only
does it need to be in writing substantiated,
but you need to independently verify that it's
actually feasible and not just take their word
for it. So you need to do your own due diligence.
And that's always a red flag when you're networking
is if someone's legit and, you know, they're
promising you a lot of stuff that they can substantiate
it and show you in an objective format. They
can show you the data or the metrics that support
what it is they're referencing to you. And that
they're not afraid to have it committed to writing
in the form of a contract if they're promising
you something that they're going to deliver and
if they don't promise you then there's consequences.
So someone wants networking with you and promises
you a lot of stuff that's great can they substantiate
what they're promising and are they willing to
reduce it to writing and stand by and if the
answer is no then that's a red flag. Usually
with, when it comes down to networking with any
industry, that's really not the place for those
exact numbers, those guarantees. And if you're
networking with somebody and they are guaranteeing
a certain number, you don't have the time to
challenge that. I just, as a rule, I dismiss
that person. Because during a networking event
for him to come out and say, Oh, I can guarantee
you X amount. I don't put a lot of credence behind
what he's saying. I think he's full of castor
oil would think that. So that's what I try to
do. Okay. Let's bring this podcast full circle.
If you could give one rule for building profitable
relationships that stay clean, compliant, and
drama -free, what would it be? Sure. Just going
back to what I've been talking about, reduce
it to writing and make sure that the relationship
is clearly expressed in objective terms, that
everyone understands what is supposed to be done,
how it's supposed to be done, and if it's not
done, what the consequences or remedies are for,
and make sure that you apply that to every opportunity
or business relationship that you have. And then
in doing that, make sure that you do it in a
cohesive objective fashion every time and you're
going to avoid a lot of problems that you could
have had if you do things that way. Absolutely.
That's great, great advice. Matthew, I'm so glad
you came on my podcast. You gave me a lot to
think about, but I hope all of my listeners have
something to think about. But if they want to
contact you, even just to speak with you, get
advice, or to hire you, what's the best way to
get hold of you? Sure, Michael. The best way
to get a hold of me is just go to my website,
which is fornarolegal .com. Just my last thing,
legal .com. And it has all my contact information.
It has all my social media. It has all my blogs.
It has all my white papers. It has all my podcasts.
It has all my videos. It has all my free guides.
So it's a really good resource for people with
questions, because a lot of the answers are right
there. And then if not, Feel free to email me
or call me. That's great. This conversation is
a reminder that great networking isn't just about
who you meet. It's about how you protect relationships
that matter. The strongest connections are built
on clarity, smart conversations, and knowing
when to move fast and when to slow down. Add
AI into the mix, and the stakes get even higher.
If today's episode changed how you think about
partnerships, agreements, or AI in your business,
share with somebody who is building something
real right now. Make sure you're subscribed to
Networking Unleashed, building profitable connections
so you don't miss conversations that help you
build opportunity without unnecessary risk. And
if you want to sharpen your communication, strengthen
your relationships or business connections that
actually pay off, head to Foreman .com to learn
how I work with professionals. teams, and organizations.
So until next time, connect with intention, protect
what you build, and keep your relations profitable.
Matthew, thank you again for coming on the podcast.
I hope to talk to you soon. Thank you, Michael.
Thank you for having me. Well, hold on, folks.
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