As a growing business, you’ve certainly addressed the basic legal requirements: setting up an appropriate business structure; protecting your name, copyrights, trademarks, and other intellectual property (IP); getting the right licenses; and selecting a location where the zoning requirements won’t obstruct your business plan.
In addition, you’ve probably encountered questions or situations where you’ve sought out advice from a law firm or an individual with special expertise: an IP attorney for advice about patenting a technical innovation; the local law firm that helped you draw up a complicated employment contract when you hired a CFO to spearhead fundraising; and an even bigger law firm that guided you through negotiations to become a supplier for a large corporation.
At some point, every business owner will notice the rising cost and frequency of legal bills and ask, “Couldn’t we handle this more cost effectively by having a lawyer on staff?”
The simple answer is “probably not.” Experts say that retaining in-house counsel is really a strategic move, designed to up your game in terms of business competitiveness. In fact, companies with in-house counsel typically find that they continue to outsource tactical projects that are outside their attorney’s area of expertise. In fact, that’s one of the major roles for in-house counsel. And that’s why hiring in-house counsel typically increases legal expenses rather than lowering it.
In-house counsel can be essential, however, if you are in active fund-raising mode. Deals involving company stock are always complex. They also involve striking a proper balance between investors and management. Usually, in-house counsel is in the best position to understand the sensitivities and achieve a positive alignment of interests.
Similarly, in-house counsel often plays a role in formulating policies and making business decisions – even those that are not specifically legal in nature. Many business owners like to get the perspective of a smart, disciplined thinker on a wide range of issues including acquisitions, key hiring decisions, and even marketing strategies.
In-house attorneys tend to have a philosophy about the law, compliance, and best practices – particularly within their area of specialization. Inevitably, this leads to projects to upgrade their company’s approach. Examples include rewriting articles of incorporation, EEOC compliance policies, NDA forms, and employment contracts. Or, you could find yourself revamping your IP protection measures from top to bottom.