Why Lawyers Do Outside In-House Counsel

Small business growth is the engine of the American economy, and any small business is going to have to rely on legal advice in order to avoid early mistakes with long-term repercussions. But there exists a gap between services required and services rendered, as many small or early-stage companies forego legal counsel altogether out of concern about cost or ignorance of the inherent risks in trying to handle things themselves.

In response to the cost-conscientiousness of the modern entrepreneur, lawyers have begun to change their approach to the traditional model of legal services. Alternative fee arrangements and outside in-house counsel are two ways in which lawyers are meeting their clients in the middle to create a better partnership for both parties. While we know the financial benefit that businesses can derive from legal, what do lawyers stand to gain from these new arrangements?

One constant between the traditional firm and the newer models is the need to attract new clients, and clients are increasingly attracted to the savings that outside in-house counsel are able to offer. We’ve chronicled how Parchment was able to cut its legal costs by fifty percent while growing at a commensurate rate, and Garrett Purdue of Purdue Law, PLLC was able to outperform traditional firms in attracting new work from clients for whom a non-traditional billing model was a major consideration.

Meeting the needs of clients is key to retaining business, and the surety of fixed cost for legal services makes for greater customer satisfaction than traditional billing. Bernard Williams, the founder of Company Counsel, LLC, was able to help a client through a variety of legal issues and entanglements to growth and partnerships with costs that the client could anticipate and services that scale as needed. And Allen Rodriguez of One400 saw the need for legal plans that meet the needs of freelancers in the gig economy. Leaving behind the traditional model of in-house counsel allows both client and attorney to create an arrangement that makes more financial sense for businesses.

Part of reducing cost is forestalling any legal issues before they threaten to engulf the client. Jonathan Tobin and Chuong Bui of Counsel for Creators have seen how clients have only sought out legal advice after their issues have grown into serious problems, rather than addressing them early on, simply because of the prohibitive cost involved in talking with a traditional attorney. Juliet Peters of Framework Legal (and Nimbus Legal!)  also noted that trying to solve a problem is far more expensive than simply tackling it earlier.  With more accessible and more affordable legal services from an outside in-house counsel, companies will avoid more of the legal headaches that could be cured with an ounce of prevention.

Offering outside in-house counsel to businesses is simply the latest and best way to be responsive to the market and to meet the needs of clients that are more conscious of cost and efficiency than ever before.

In the next part, we will discuss the services that attorneys can offer as an outside in-house counsel.