What is fractional counsel?
Good in-house lawyers are fundamental to the health and growth of organisations.
‘Fractional counsel’ is a highly flexible way of bringing in-house legal expertise and horsepower into your business in a shape that suits your organisation’s specific needs and budget – because every business is different.
So how does it work in practice? Does it overlap with your other resources? Is it an alternative? First, it’s helpful to understand the important differences between the different types of business lawyers.
What is the difference between in-house lawyers and private practice lawyers?
Whilst all lawyers provide legal advice, there are a number of significant differences between external (private practice) lawyers and in-house business lawyers.
The differences typically include:
- their areas of expertise and the depth of that expertise
- the breadth of their practices, knowledge and experience
- their alignment with and understanding of their client’s business
- the cost of their services
- their approach to risk
What do private practice lawyers do?
External lawyers, in traditional law firms are, by and large, excellent lawyers, but they are typically highly specialised on a single practice area (such as a specialist type of financing or a particular medium of dispute resolution) in which they build deep expertise over time.
For that reason, traditional law firms are particularly good at delivering large, one-off projects such as a capital raise, a business acquisition or a complex, drawn out court battle.
The price for law firm support is normally very high, but the result should be a large and complex project delivered with high quality, over a short time frame and with low risk.
Clearly there is, and always will be, a place for this service, provided that it is consistently delivered to a high standard.
On the other hand, traditional law firms are not so well positioned to support a business with the legal aspects of their day-to-day business operations.
Their expertise is typically too spread out across different individuals and their pricing model (normally high hourly rates) effectively disqualifies them for regular work for all but the most profitable and risk averse organisations.
So what about in-house lawyers?
In-house lawyers operate very differently.
For starters, by definition, they are normally full time employees of their only client and, as part of an organisation’s internal team, their job is to provide ongoing oversight of their organisation’s risks as well as the legal aspects of their organisation’s business activities on a day-to-day basis.
To deliver that service, in-house lawyers must take a far more holistic and proactive approach than private practice lawyers.
They must learn to head off risks before those risks manifest and they must do so across multiple business functions and multiple areas of expertise.
This is a very different function and a very different skill set.
All at the same time, in-house lawyers must be commercial contract negotiators, litigators, company secretaries, corporate lawyers, intellectual property experts, data protection and regulatory experts, risk analysts, board advisors… the list goes on.
Each of these single skillsets is often the work of an entire career for a private practice lawyer in a traditional law firm.
Further, in-house lawyers must come to learn and contribute to their organisation’s risk appetite and preferences, politics and reporting lines.
They must operate as part of their organisation, they must align with their management teams and they must play a central role in their organisation’s mission to drive growth and manage risk.
What if we already have external lawyers?
A fractional GC service provides clients with a clear alternative from either employing a full-time in-house lawyer, on the one hand, or going to a traditional law firm, on the other hand.
Here at Clearlake Law, for example, our fractional GC service is designed to cover the full spectrum of day-to day-legal work by a senior lawyer who is a specialist in the client’s industry (as opposed to being a specialist in just one single legal practice area).
A fractional GC might pick up some of the types of work that external lawyers typically provide (large commercial deals, early stage disputes, specialist regulatory advice) but they will operate much more like in-house lawyers.
They will be closely aligned with your business goals. They will learn to understand your business organisation and risk tolerance. They are essentially part of your team – at least, as much as you want them to be.
The fractional counsel’s work is typically part of your organisation’s ongoing business as usual, as opposed to bet-the-farm deals (like a sale of your company or an IPO, which are better left to traditional law firms).
External lawyers will typically respond to requests for specific legal advice; for example, delivering a set of terms and conditions, or negotiating them in accordance with your instructions.
On the other hand, a fractional counsel will typically work proactively with your organisation, scanning the horizon for new regulatory developments and unmitigated risks, working to improve your internal processes alongside the day to day work of getting commercial deals done, contributing to broader business projects and advising your senior management as needed.
Here at Clearlake Law, our partners have all worked in senior in-house positions in large and fast-moving organisations. We deliberately take the same commercial, proactive and dynamic approach to business legal practice as do the very best in-house lawyers.
What if we already have in-house lawyers?
In Clearlake’s fractional counsel service, for example, a partner at Clearlake Law either acts as your organisation’s sole general counsel (if you don’t already have one) or works underneath your general counsel as part of your wider legal team.
We know every business has a different staffing set-up and we fit alongside your set-up in a way that suits your needs.
For some organisations, the time and cost of recruiting a high quality legal resource as a full time employee (whether as a general counsel or as a resource to support a general counsel) is either too high or too inconvenient.
Where we step in as your sole general counsel, the partner acting for your business oversees your entire legal function and your risk position, liaising with and advising your senior management and providing the legal advice and support your organisation needs from top to bottom.
Where we work alongside your existing legal function, we provide an expert set of hands to outsource one-off projects or ongoing, standalone work streams (for example, we can completely outsource a particular type of contract that you regularly negotiate with customers).
In the alternative, we simply provide an extra, highly experienced professional to work across your business during busy periods, as an additional, reliable resource.
Whatever the set-up of our relationships with our clients, we tend to work in long term partnerships which evolve with our clients’ needs over time.
You can switch our service on and off, as and when needed, but we will always come to understand your business inside-out, and retain that experience so that it is always available to you.
What if we don’t have the budget for legal advice?
Pricing for fractional general counsel typically sits between the hourly cost of hiring a full time in-house lawyer as an employee (low) and the hourly cost of a traditional law firm (high).
As mentioned, our mission at Clearlake is to transform the way legal work is performed and delivered for the benefit of clients, lawyers and lawyer-clients. In terms of pricing, that means making excellent, business-friendly legal services available to all businesses at highly accessible price points.
The upside of fractional GC, of course, is that it is far more flexible than hiring a full time or part time in-house lawyer or contractor and we are significantly less expensive than a traditional law firm.
The model enables you to bring a senior, highly-experienced resource into your organisation for just the low number of hours that you need, thereby retaining full control over budget.
At Clearlake, whilst we provide ad hoc project work, we typically work on an ongoing monthly retainer, for which we are able to discount our rates further still.
Our monthly retainers can be as flexible as you like (as little as 5 hours a month, for example) with unused hours rolling over or future hours usable in advance.
The aim is to produce as flexible an arrangement as possible for your organisation at a fixed, affordable price point that suits your business.
The longer the term and the more the hours your commit to under our retainer arrangements, the more we are able discount our rates.
Are you generalists or specialists?
At Clearlake, we want our partners to be both, and very deliberately so.
Each of our partners is a seasoned general counsel, able to operate across legal disciplines and identify risks across the board, but we deliberately recruit for an additional specialist skillset in each of our lawyers as well.
It is impossible to replicate the in-house working environment, operating across so many different disciplines at the same time when just working as a private practice lawyer, so we require each of our lawyers to have worked in senior in-house positions before joining our partnership.
On the other hand, we also insist that each of our partners started their career at a leading law firm, that is in part to ensure they have a grounding in top-tier professional legal practice, but also so that they have developed a specialist skill set from early on in their careers.
The result is that all of our partners are generalist lawyers, able to operate as senior in-house advisors across practice areas, but we also have a deep well of expertise in fields such as payments, crypto, intellectual property, SaaS commercial agreements, data protection regulations and so on.
To find out more about our fractional counsel service, please send us a note using our enquiries form by clicking below or visit our fractional GC web page to learn more.
About Clearlake
Clearlake is an innovative law firm, headquartered in the City of London.
Our mission is to transform the way legal work is performed and delivered for the benefit of clients, lawyers and lawyer clients.
We deploy outstanding commercial lawyers in innovative service models, fully aligned with our business clients’ individual needs.
We are also constantly developing new, cutting-edge legal technologies to maximise the output of both our clients’ and our own personnel.
To find out more about how we can support your organisation’s continued transformation, please contact us on enquiries@clearlake.law or call us on 0203 432 4464.
