Controller-Grade Valuation Sanity-Check
Law All-Day Platform (Standalone)

§ 1 Scope & Methodology

1.1 What's being valued

Law All-Day Platform v1.0 — NY/NJ plaintiff PI + WC + immigration legal-operations platform. Inventory verified per Katrina's 2026-05-29 IP_ASSET_FACTS audit at ~/lawallday/IP_ASSET_FACTS_2026-05-29.md.

Scale

Signature subsystems

Brand assets

• Law All-Day (canonical wordmark) · Law All·Day (interpunct masthead variant)
• Day Law Inc. (Robert's sole-practitioner entity, separately filable)
• Counsel (in-platform AI assistant name)
• Tagline: "The legal-operations platform for the modern plaintiff firm"
• Domains: lawallday.com · law-all-day.com · law-all-day-platform.pages.dev
• Palette: oxblood + brass + parchment

Authorship paper trail

• Joe sole principal author / curator
• CLAUDE.md 80KB dated changelog (2026-05-07 → present)
• ~/Counsel/zane/ memo series
• Per-matter audit.jsonl logs
• Cloudflare Pages deploy timestamps
• All dependencies MIT-licensed except Documenso (AGPL, external service)

1.2 Industry-standard methodology

Per ASA + AICPA SSVS-1 + IRS RR 59-60 conventions, three approaches are run and triangulated: Cost (replacement / cost-to-recreate), Income (RFR + DCF), Market (precedent transactions in legal-tech). A CBV would then layer key-person, customer-concentration, co-founder-dependency, single-vendor-AI, and DLOM discounts.

§ 2 Cost Approach Replacement / Cost-to-Recreate

2.1 Inputs

Loaded rate: $225/hr. NY/NJ metro senior full-stack engineer with legal-vertical familiarity, fully-loaded per Robert Half + Glassdoor 2026 Q1 benchmarks.

Productivity benchmark: 25–40 LOC/hr midpoint 32 LOC/hr for production-quality code with testing.

2.2 Raw replacement cost

2.3 Adjustments

2.4 Cost approach range

This is the floor. The cost approach captures what a buyer would pay if the alternative were to build clean-room — not going-concern value, not strategic-acquisition premium.

§ 3 Income Approach

3.1 Sub-method A — Relief-from-Royalty (RFR)

Royalty rate: 10% (legal practice management sits at higher end of legal-tech 5–15% band per RoyaltySource 2026 Q1; specialized vertical legal-ops platforms with embedded domain logic command 8–12%; midpoint 10%).
Discount rate: 30% WACC (slightly lower than 35% used for diversified pre-revenue portfolios because the signed LOI with named co-founders + commercialization plan represents a de-risked commercialization narrative).

Projected addressable revenue Y2–Y5 (reasonable case)

Positioning wedge: $99–499/firm/mo per Katrina's Legora-positioning analysis. LawAllDay sits below Legora ($30K minimum ACV, BigLaw-only) and Harvey AI ($1–1.2K/lawyer/mo enterprise-only) — captures the ~95% of plaintiff PI / WC / immigration / foreclosure-defense / small-firm legal market that Legora and Harvey structurally cannot serve.

Royalty applied (10%): Y2 $24K → Y3 $96K → Y4 $240K → Y5 $495K; terminal flat $495K.

PV of royalty stream (30% WACC)

RFR range: $400K — $1.1M, midpoint ~$720K.

3.2 Sub-method B — Direct DCF (operator path)

If LawAllDay LLC operates the IP at full margin: capture 100% of revenue × operating margin. Operating-margin ramp 5% Y2 → 27% Y5 (mature legal-tech vertical SaaS like Clio / MyCase / Filevine).

DCF range: $2.5M — $7M, reasonable midpoint ~$4.2M.

DCF assumes execution that DeJesus + Young + Joe can deliver at scale per LOI commitment. Reasonable but contingent on co-founder execution.

3.3 Income approach triangulation

§ 4 Market Approach Legal Practice Management Comparables

4.1 Public-comp + private precedent transactions

4.2 Strategic-acquirer ranges

4.3 Pre-revenue private-deal floor

Typical pre-revenue strategic legal-tech IP acquisition: $2M — $8M, midpoint ~$4M.

4.4 Market approach concluded

§ 5 Triangulation & Concluded Ranges

5.1 Discounts a CBV would apply

FMV range after CBV discounts: $1.5M — $2.5M.

5.2 Strategic-value premium

§ 6 Recommendations

6.1 For Joe's IP contribution into Law All Day Legal Software LLC

Why this number:

• Sits at the cost-approach midpoint — defensible by direct replacement-cost arithmetic
• Above the $500K safe-harbor threshold → CBV signed memo is required before LOI execution because (a) DeJesus + Young are non-Joe contributors at material basis, (b) Joe's 2% equity entitlement is contingent on this IP-contribution valuation
• Conservative for tax: low capital account → high gain on hypothetical sale → no §721 phantom-basis risk
• Sets a sensible baseline for the §83(b) Hurdle Amount calculation for DeJesus + Young's profits interests (if structured that way)
• Leaves significant headroom: if a strategic offer ever lands at $5M+, Joe's IP position reads as "platform appreciated above basis," not "inflated day-one anchor"

6.2 Cap-table arithmetic

• Day-one entity capital structure = Joe's IP contribution ($650K) + DeJesus + Young services-or-cash contributions (TBD per founder discussion). Robert / CBV should bake this into the LLC OA.
• Joe's 2% equity stake in the LLC is separate from the underlying IP valuation. If the LLC is later valued at $5M total enterprise, Joe's 2% = $100K. The IP-contribution valuation supports the entity's day-one basis, not Joe's personal equity carrying value.
• Cashflow distribution (8% to Joe) is the more material economic right per LOI Counsel Note 1 — gross-software-cashflow definition is a Founder-discussion item.

6.3 Joe's strategic-options table

6.4 When to engage the CBV

Required engagement triggers (any one of):

• LOI execution / Joe's IP contribution into LawAllDay LLC — required because contribution exceeds $500K safe-harbor AND DeJesus + Young are non-Joe partners
• Any third-party offer requiring asking >$500K basis support
• Exit / sale within 12 months

§ 7 Caveats & Limits

1. NOT a CBV opinion. Norma is not credentialed to issue one. ASA / CBV signed memo required for $500K+ safe-harbor.
2. All revenue projections are hypothetical. Zero ARR today; LOI not yet executed. Income approach built on plausible licensing/operator narrative + Katrina's Legora-positioning competitive analysis; a CBV will stress-test more aggressively.
3. Key-person risk is real but mitigated. Joe is sole architect, but CLAUDE.md 80KB dated changelog + audit log discipline + documented design patterns reduce technology-transfer risk vs other portfolio assets.
4. Co-founder dependency is a structural risk. DeJesus + Young as commercial leads per LOI; their departure pre-execution would crater the commercialization thesis.
5. Anthropic dependency. Mata citation-verification gate runs on Anthropic; pricing / TOS / access risk not modeled. Smaller exposure than orchestration-platform assets.
6. AI-authorship copyright vulnerability per IP Plan §9.1. Thaler v. Perlmutter + USCO March 2023 policy mean AI-generated portions are NOT copyrightable; only Joe's selection / arrangement / prompt-engineering / cascade-architecture layer is. A buyer's IP diligence will test this and may carve specific generator modules out of the protectable claim.
7. Documenso AGPL dependency. LawAllDay consumes Documenso as an external service (AGPL); documented but creates a license-compliance obligation for any commercial deployment. CBV / acquirer counsel will surface this.
8. No directly comparable transactions exist for "NY-vertical small-firm plaintiff PI legal-ops platform with embedded Mata-gate + Culpable-Party engine." Market approach borrows from adjacent comps.
9. Loaded rate is a single-point estimate. $225/hr conservative midpoint of $200–$300; results scale linearly with rate.
10. LOC-based cost-approach is known approximation. A CBV may prefer Function Point Analysis or modified COCOMO II.
11. LawAllDay LLC equity valuation ≠ IP valuation. This memo values the IP itself ($650K cost-anchored / $2.5–3.5M triangulated reasonable). Joe's 2% equity stake in LawAllDay LLC is a separate calculation, depending on total entity valuation and the eventual cap table after DeJesus + Young contributions are valued.

§ 8 Bottom Line