What to Know Before Hiring Outside General Counsel
Most businesses reach a point where a quick phone call to an attorney is no longer enough. Contracts are getting more complex, employment questions are coming up more often, and leadership needs someone who understands the legal side of business decisions before they become problems. That is exactly where outside general counsel comes in.
Our friends at Kravets Law Group discuss this arrangement frequently with growing companies. Outside general counsel gives businesses access to a senior legal advisor who functions like an in-house attorney, without carrying the cost of a full-time salary, benefits, and overhead.
What Outside General Counsel Actually Does
The role goes well beyond reviewing contracts. A good outside general counsel works closely with ownership and leadership to spot legal exposure before it turns into litigation. That means getting involved early in business decisions, not just after something has gone wrong.
Common responsibilities include:
- Reviewing and drafting commercial contracts and vendor agreements
- Advising on employment matters, including hiring, discipline, and terminations
- Guiding compliance with industry-specific regulations
- Supporting mergers, acquisitions, or business restructuring
- Coordinating with outside litigation counsel when disputes arise
- Protecting intellectual property and managing licensing matters
The relationship is ongoing. Unlike hiring an attorney for a one-time transaction, outside general counsel gets to know your business, your risk tolerance, and your goals over time.
Why Businesses Choose This Model
The primary appeal is cost efficiency. Bringing on a full-time general counsel can cost a company well over $200,000 per year when factoring in salary and benefits, according to data from the Bureau of Labor Statistics. For most small and mid-sized businesses, that number simply does not pencil out.
Outside general counsel delivers many of the same benefits at a fraction of the cost. You pay for what you need, whether that is a set number of hours each month or a flat retainer covering a defined scope of work.
There is also a depth-of-experience factor. Many attorneys who step into this role have spent years at larger firms or in-house at major companies. That background matters when your business is facing a situation that carries real risk.
Common Mistakes Businesses Make
Even when companies understand the value, there are a few missteps worth avoiding.
Waiting too long to bring legal counsel in. Many businesses only engage a general counsel after something has already gone sideways. Getting legal advice before signing a major contract, making a significant hire, or entering a new market is almost always less expensive than dealing with the fallout afterward.
Treating the relationship as transactional. Outside general counsel works best when the attorney is treated as part of the leadership team. That means including them in strategic conversations, not just sending contracts over when a signature is needed.
Assuming one attorney can handle everything. A good outside general counsel knows their limits. Part of the value is that they can help coordinate and manage specialists in areas like litigation, tax, or intellectual property when the situation calls for it.
Is It the Right Fit for Your Business?
Not every business is at the stage where outside general counsel makes sense. Early-stage companies with simple legal needs may be fine with project-based legal work. But if your business is growing, entering into complex relationships, or facing recurring legal questions that slow down decision-making, the arrangement is worth serious consideration.
The right advisor will take time to understand your business and bring consistency to how legal issues are handled across the organization.
If you are weighing whether outside general counsel is the right move for your company, speaking with an attorney who offers this type of arrangement is a good starting point. We work with businesses at various stages to structure legal support in a way that makes practical and financial sense.