Whether an entrepreneur is starting a new venture or an established enterprise is expanding its portfolio, every business needs legal advice from an expert attorney who understands the company and the industry. Even when business practices don’t change, applicable laws and regulations are often updated in a way that impacts operations, and an ongoing understanding of legal matters benefits everyone.
Unfortunately, not every company can afford an in-house attorney, which can put them at a disadvantage. For startups and new ventures, fractional legal counsel may be the perfect solution.
What Is Fractional General Counsel?
A fractional general counsel is an attorney who works for your business as an independent contractor and who may have other clients. You may contract with a fractional GC for a set amount of hours or a specific rate per month at considerable cost savings over hiring an in-house general counsel.
What Does a Fractional General Counsel Do?
Within the contracted amount of time, a fractional general counsel performs the same types of services as a general counsel, focusing on the legal, commercial, or regulatory affairs affecting your company. A fractional general counsel may be involved in:
- Legal advice and guidance
- Compliance-related projects
- Legal operations
- Regulatory work and risk assessment
- Collaborating with your finance department on budgeting and reporting
- Working with HR to address employee-related issues
- Contributing to commercial or product strategies
- Negotiate with external parties
The exact scope of a fractional general counsel’s work depends on the engagement. In many cases, a fractional GC may also perform additional duties like crisis management, public advocacy, or conflict resolution for an additional cost.
Fractional General Counsel vs. General Counsel
When considering whether the fractional general counsel may be the right choice for your business, here are some key factors to keep in mind:
Customized Legal Services
Working with a fractional general counsel gives you the ability to customize a contract for the legal services you need without paying for time or services that aren’t relevant to your business.
Ongoing Legal Oversight
With a general counsel or a fractional general counsel, you have the advantage of continual legal guidance. For regular operations, reporting, and compliance, your legal needs are met on an ongoing basis. A fractional GC and a GC will also provide ongoing insight and awareness of pending legal, regulatory, or compliance issues that may affect your company.
Established Relationship
Both GC and fractional GC have an established relationship with you and your business. They are familiar with your goals, challenges, and operations and can quickly address new issues or concerns.
Predictable Legal Costs
With both a fractional general counsel and a general counsel, you have the advantage of predictable costs for your legal needs, simplifying budgeting.
Timely Access to Legal Advice
A general counsel or a fractional general counsel can be available to you and your leadership team for timely answers to questions and concerns rather than attempting to find a new attorney when issues arise.
Benefits Funding and Capital Strategies
Adding a fractional GC to your team may benefit your funding and VC strategies, as many lenders and investors appreciate seeing an attorney on the leadership team, even if it’s only part-time.
Proactive Legal Solutions
All too often, companies seeking to save money only invest in legal services when they have an issue or a challenge. Working with a fractional general counsel saves money while ensuring a proactive, preventative approach to potential legal and compliance issues.
In other words, for small businesses that cannot afford or do not need a full-time, in-house general counsel, the fractional general counsel model may be the perfect solution.
When Would a Company Need a Fractional General Counsel?
Generally speaking, there are two scenarios when companies most need a fractional general counsel:
- They are a small business or startup. Small businesses have legal matters that require the advice of an attorney but often do not have the need for a full-time, dedicated general counsel. If your legal and compliance issues can be addressed in a few hours a month, a fractional general counsel may be the better approach.
- They have a specific legal issue or challenge. Often, even companies that have in-house counsel may hire a fractional general counsel for a specific issue or area of law. For example, they might choose a fractional GC to complete a transaction or acquisition, manage a specific conflict or area of litigation, or address regulatory issues in a specific region.
How To Find a Fractional General Counsel
The fractional general counsel is a fairly recent model for offering legal services, so it may be difficult to find the right fit for your business. However, many experienced attorneys are looking for more flexible roles and find that fractional GC work is perfect for them. If possible, get referrals from your legal or business contacts to find qualified attorneys who may be suited to this role. You may also search LinkedIn or other professional sites to identify potential fractional GCs.
When looking for a fractional GC, look for the same qualities you would want for in-house counsel. Your fractional GC should have experience in the industry or the relevant space, understand your challenges and goals, and relate well to you and your leadership team.
Reputation is always critical when choosing an attorney, especially when establishing an ongoing relationship, so make sure to review their qualifications, rankings, and other tools to determine whether you are making the right choice.
What Is the Average Cost of a Fractional General Counsel?
Like any attorney, the cost of a fractional GC depends on their experience and on the complexity of your legal issues. The exact cost will also depend on the agreed-upon scope of their services. Many businesses report that the cost of contracting a fractional GC is roughly equivalent to the cost of a full-time entry-level employee.
Fractional general counsel is an innovative, flexible way for new and growing businesses to meet their needs for ongoing legal services at a more affordable price. If you would like to learn more about fractional GC services and whether the Fridman Law Firm may be right for your legal needs, contact us today or call 212-262-9823 for more information.