If you own a small to midsize business in Texas, partnering with outside general counsel can give you the legal protection and resources you need while controlling legal spend.
Here are eight things to consider when evaluating an attorney and law firm to serve as your outside general counsel, and an overview of how outside general counsel could fit into your business.
1. Experience and Expertise
The ideal general counsel brings both depth and breadth to your business challenges. Look for attorneys who understand your specific industry landscape and have worked with businesses at your current stage of growth. They should demonstrate strong knowledge in the legal areas most relevant to your operations – whether that's contract negotiation, employment law, intellectual property protection, or regulatory compliance.
A counsel's track record speaks volumes. Ask about their experience helping similar businesses overcome legal hurdles and achieve their goals. The right attorney won't just know the law; they'll know how to apply it practically to your unique situation.
2. Cost Structure: Beyond the Billable Hour
Understanding a law firm's fee structure is essential for budgeting and avoiding surprises.
- Fee Transparency and Options: Make sure you understand how the law firm bills for its services. Most outside general counsel services are billed hourly, while holding a retainer in escrow.
- The Hidden Cost of Delegation Beware of law firms that charge downtown rates but delegate the work to junior associates you've never met. This common practice in larger firms can result in paying premium rates while your actual work gets handled by less experienced attorneys. Always clarify who will be working on your matters and how delegation affects billing.
- Budget Alignment: The right counsel recognizes the financial realities of running a small business. They should be willing to discuss budget constraints openly and find creative ways to provide necessary legal support within your means.
- ROI Consideration: Legal services are an investment. Consider not just the cost, but the value delivered through risk mitigation, dispute prevention, and protecting new business opportunities.
3. Accessibility and Communication
Effective legal counsel isn't just about expertise – it's about availability when you need it most and communication that works for you.
- Responsive Service: Your business doesn't operate in a 9-to-5 world, and neither should your legal support. Look for counsel who demonstrates a commitment to responsive service that eliminates communication black holes. When legal issues arise, you shouldn't be left wondering when you'll hear back.
- Lean Staffing Model: Seek out firms where clients work directly with experienced partners without paying for layers of unnecessary oversight. This lean approach ensures you're getting senior-level expertise directly, rather than filtering communications through multiple tiers of attorneys – all who bill you for their time.
- Communication Style: Find an attorney whose communication approach matches your preferences. Some business owners prefer brief, direct guidance; others want comprehensive explanations. The right counsel adapts to your needs and explains complex legal concepts in terms relevant to your business decisions.
4. Business & Industry Understanding
Your general counsel should function as more than just a legal technician. They should invest time in understanding your business model, industry dynamics, competitive landscape, and growth objectives.
This business context enables them to provide advice that balances legal protection with practical business realities. The most valuable counsel serves as a true business partner, helping you evaluate risks in relation to rewards and finding legally sound paths to achieve your goals.
5. Finding the Right Balance: Experience with Agility
Choose a law firm that has the experience to offer quality counsel alongside the agility and attention that your small business needs. Look for attorneys who will take time to understand your specific frustrations and offer a genuine solution. Many small businesses find themselves caught between inexperienced but affordable options and highly qualified but impersonal large firms.
The ideal counsel combines deep legal expertise with the flexibility to adapt to your unique needs. They should demonstrate a willingness to listen closely to your concerns and develop customized solutions rather than applying one-size-fits-all approaches or assuming they know the solution before taking the time to listen to you.
6. Firm Size and Resources
The size of the firm you choose comes with distinct advantages and considerations:
Solo Practitioners and Boutique Firms:
- More personalized attention and direct partner involvement
- Often more flexible and cost-effective
- May have focused expertise in specific areas
Mid-size and Larger Firms:
- Broader range of specialized expertise under one roof
- More extensive resources for complex matters
- Potentially higher costs and more layers of staffing
The right choice depends on your specific needs and growth trajectory. Some businesses benefit from the personalized focus of a boutique firm, while others need the reach and scope of a larger organization.
7. Personal Connection: The Foundation of Partnership
Your relationship with outside counsel is often long-term and involves sharing sensitive business information. It’s important that you feel comfortable with a potential outside general counsel and believe that you will enjoy working with them long-term.
Look for counsel who:
- Demonstrates authentic interest in your business success
- Shares values alignment with your organization's culture
- Communicates in a style that builds trust and comfort
Trust your instincts during initial consultations. If communication feels strained or you sense misalignment in approach, consider it a potential warning sign.
8. Prevention Mindset: Beyond Problem-Solving
While resolving legal issues is important, the most valuable counsel helps you prevent problems before they arise. Look for attorneys who:
- Take a proactive approach to identifying potential legal risks
- Help develop business policies and procedures that maintain compliance
- Regularly review your operations for emerging legal considerations
- Offer preventive legal “checkups” to catch issues early
This preventive approach often delivers the greatest long-term value, helping you avoid costly disputes and regulatory complications.
How Outside General Counsel Can Help
General counsel handles day-to-day legal needs, like negotiating contracts and advising you on HR decisions.
You can hire in-house general counsel, but for many businesses, there’s not enough legal work to justify a full-time salary and benefits. Outside general counsel, on the other hand, is available to you on an as-needed basis. You only pay for the services you use.
Since general counsel works with you regularly, the attorney knows your business. That saves you money, because you aren’t paying a lawyer to get up to speed on each problem. And since most outside general counsel work in law firms, it’s easy to scale as your needs grow.
Making Your Decision
The right outside general counsel becomes an invaluable extension of your team – someone who understands your business objectives and helps you achieve them through sound legal strategy. Take time with this decision, conduct thorough interviews, and check references from other small business clients.
Remember that the lowest hourly rate doesn't always represent the best value. Consider the full picture of expertise, accessibility, business understanding, and preventive approach when making this critical choice.
Your legal counsel should ultimately provide peace of mind, allowing you to focus on what you do best: growing your business.
Take the Next Step
Hendershot Cowart P.C. offers top-tier services while being nimble and responsive. Streamlined decision-making is one of our advantages; we move quickly from problem identification to solution implementation.
Ready to discuss your business's legal needs? Call Hendershot Cowart P.C. today at (713) 783-3110 to schedule a consultation with one of our experienced business attorneys.