Fractional General Counsel
Fractional General Counsel Services Overview
What does it mean? Isn't this the same as using any other lawyer for my business?
A fractional general counsel (“FGC”) is an external lawyer that provides the services normally performed by an in-house counsel, but they do so on a part-time basis. You're getting a fraction of the time of an outside general counsel. The goal of having an FGC is to enhance a company's strategic decision-making by offering expert legal guidance without the overhead of a full-time in-house legal team. An FGC provides flexible, on-demand access to legal expertise across various areas, including commercial contracting, compliance, risk management, and corporate governance.
There are several differences between utilizing an FGC and the services you normally receive from external lawyers. The primary difference is the level of involvement your FGC will have with the business. Your FGC should be an integral (albeit adjunct) member of your team. The FGC will learn your business inside and out and should serve as a key advisor for the leadership team. The relationship is not based on one-off matters and is instead designed to be long-term.
Another important difference is that your FGC should build the foundation for the legal function in your business. If you're a business that intends to grow and will eventually need a full-time in-house lawyer (or legal team), your FGC can create the foundation for those functions. Your contracting process will be well-defined, with appropriate oversight and approvals. The regulatory compliance function will be fully operational, and your business will be compliant. Your corporate books will be in good order so there's no need wonder who was approved as an officer, or if the company actually had a resolution to approve the loan you took out last year. This way, when you add a full-time general counsel, your FGC can assist with an orderly transition and your new lawyer can start adding strategic value on day one.
What services can be included in this type of legal services delivery model?
As with any business relationship, it is critical that you and your lawyer have properly defined expectations about the services being delivered. No two clients are the same and therefore the services being delivered (and the associated cost) will likely vary based on business needs. In general, FGC services can include the following types of support:
a. Strategic advice and counsel
As a strategic partner, an FGC contributes beyond just legal advice; they can identify potential risks, optimize business operations, and support growth initiatives by aligning legal strategies with broader business goals. This partnership ensures that legal considerations are seamlessly integrated into the company's strategic planning, enabling more informed, forward-thinking decisions while controlling costs and maintaining efficiency. You get the value of your FGC's legal and business acumen without the cost of a full-time resource.
Lawyers often serve as cautious advisors within a business. In a fast-growing, ambitious company, founders, new executives, and sales teams may sometimes overlook or downplay potential risks. Your FGC should act as a balancing force, helping to spot risks and offer solutions. Think of your OGC as a GPS that suggests alternate routes to help you avoid accidents and traffic jams before they occur. We aim to help you reach your goals, but with greater safety along the way.
b. Contract-related services
By having an FGC, you gain a skilled and experienced contract negotiator who can deeply understand your business. While any competent lawyer can redline a liability clause, advise on IP rights, or flag that a termination for convenience clause has a 60-day notice period when you might prefer less, your FGC goes further. They understand what makes deals profitable for you and can negotiate terms like termination for convenience based on your specific investment in the contract and your need to recover amortized costs in case of termination. Your lawyer may be the only person who reads every word of a contract, and you want that lawyer to know your business as well as you do. Otherwise, you might as well use an AI tool to generate contract redlines.
Contract-related services can vary in scope based on a number of factors, including:
i. Volume. Is your company doing hundreds of contracts a month or just a handful?
ii. Monetary value. Are your deals worth thousands of dollars each? Millions?
iii. Complexity of deals. How complex are these deals - both in terms of the contract paper involved and the negotiations?
In some circumstances your FGC may be responsible for dealing with all your contracts. In others, due to the factors listed above, your FGC may deal with some or all your contracts as separately defined (and billed) tasks. The arrangement should be customized to meet your business needs and budget.
c. Regulatory compliance (e.g., Privacy, Licensing)
An FGC adds substantial value to a business by ensuring it remains compliant with evolving regulatory frameworks. Regulatory compliance is complex and varies across industries, but an FGC brings specialized expertise to navigate these challenges effectively. They keep the company up to date on relevant laws, policies, and industry-specific regulations, reducing the risk of fines, legal disputes, or reputational damage due to non-compliance. An FGC also develops proactive compliance strategies, conducts audits, and ensures that internal processes align with legal requirements. By doing so, they help the company mitigate risks, avoid costly penalties, and maintain operational integrity, all while allowing the business to focus on its core activities.
d. Employment-related matters
Your FGC can offer valuable expertise in managing employment-related issues, offering essential support to businesses in navigating the complexities of labor laws and workplace regulations. With ever-changing employment laws, an FGC helps companies stay compliant with federal and state regulations, ensuring that policies related to hiring, compensation, workplace safety, discrimination, and terminations are legally sound. They also assist in resolving disputes, such as handling wrongful termination claims, harassment allegations, or wage and hour disputes, while minimizing the risk of litigation. By providing proactive legal counsel on employee relations and developing best practices for HR policies, an FGC helps foster a fair and legally compliant work environment, protecting the company from costly legal challenges and preserving its reputation.
e. Corporate governance
As a business owner or executive, how often do you want to focus on Board resolutions or whether all the corporate formalities are being satisfied so individuals retain the liability protections afforded by doing business as a separate entity? You have people to manage, clients and investors to satisfy and revenue to generate. Your FGC can handle all of that.
f. Intellectual property
An FGC can provide comprehensive intellectual property (IP) support by helping businesses identify, protect, and leverage their IP assets. They can guide the development of strategies for patenting inventions, trademarking brand elements, and protecting trade secrets, ensuring that your IP portfolio aligns with your business goals. In addition to drafting and negotiating IP-related contracts, such as licensing agreements, an FGC can help enforce your rights against infringement and advise on navigating complex IP regulations. With their deep understanding of both the legal landscape and your business operations, they ensure your IP strategy supports long-term growth and competitive advantage. That is not to say that you will not need external IP counsel, but your FGC should provide the high-level counsel and guidance necessary to assist with your IP strategy.
g. Outside counsel management and liaison
How good are you at reviewing and analyzing legal bills? Do you enjoy working with internal stakeholders to assist with extensive (and often time-consuming) discovery requests? How many complex commercial disputes or employment lawsuits have you litigated and resolved? How would you rather spend your limited time: a) running your business, or b) managing outside counsel?
These are just a few of the questions you should be asking yourself if your business has a frequent need for outside counsel – whether it's litigation, M&A, IP matters, etc. Your FGC functions as the head coach of all your lawyers. (In case you're wondering, you're the owner of the team). Your FGC should have experience in selecting and negotiating with outside counsel to ensure you're getting the right lawyers at the right rate. They can review and assess bills to ensure your external lawyers are efficient and that work is being done by the right level of professional (i.e., expensive senior partners doing expensive senior partner work and pushing lower-level work down to less expensive resources). Because your FGC will know your business well, they can drive efficiencies in the discovery process if you are litigating matters.
They'll also know your style and preference of dispute resolution and can help guide your external lawyers down the appropriate path. What does that mean? Does your business value quick and quiet resolution of disputes to avoid potential bad publicity? Or do you take a scorched earth approach because you need to let potential adversaries know you are not an easy target? Each approach – and the multitude of others – has an impact on how your external counsel proceeds and your FGC will guide them appropriately while you focus on managing and growing your business.
Cost Models
Most FGC arrangements utilize a fixed monthly fee. Whether you call that a retainer, flat fee, fixed fee, subscription fee or something else, the result can be the same. Your business is buying a defined set of services for a defined price. There is no need to close your eyes and hope for the best every time you open a legal bill. There is also no need to hesitate each time you want to call or email your FGC because you're worried about running up this month's legal bill. This is our default billing approach for FGC services because we want to be involved in the discussions and decisions that matter.
These services can also be delivered using a traditional billable hour approach or a hybrid of the two. The key is to work with your FGC to find an approach that fits your business needs and to revisit the model on a regular basis to make sure it still suits your business needs.
Get Started Now
Contact Eldredge Law Group today by using the online form or calling us at (804) 986-8238. We will schedule a free 15-minute consultation and outline all the benefits that our business legal team can provide to you and your company.