In the new era of modern work, professionals at all levels are redefining how they want to be employed. With companies also tightening budgets and reimagining their legal resourcing, we have seen a growing appetite for ‘fractional executives’ – seasoned C-suite professionals with impressive career histories and a willingness to take on strategic high-level roles on a part-time or project basis.
In the legal industry, the fractional general counsel (GC) is a growing phenomenon, as a term used to describe a highly-experienced and senior lawyer with a generalist skillset who is comfortable taking a hands-on leadership role. A fractional GC can go into an early-stage business and provide top-level commercial advice to the board, typically where there is no existing senior legal resource. They can spot risks, identify emerging challenges and flag areas where additional legal support might be needed.
Will Samengo-Turner, Allen & Overy’s co-head of technology for EMEA, says fractional GCs can be pivotal to helping fast-growing companies avoid costly legal mistakes. “If you are filing documents, signing contracts, issuing incentives or equity or developing intellectual property that is important to your business, you probably need a lawyer. If you have products or elements of your business that are regulated, or you are dealing with counterparties that have lawyers, then you should be asking yourself whether you should have a fractional GC too, or whether the lack of one is a strategic risk to the business.”
Fractional GCs are a cost-effective option in identifying what needs to be prioritised from a legal perspective, and they may not have all the answers, but know where to go to get them. They will join a company for a fraction of time – whether to achieve a certain goal or to meet a certain ongoing need – and, unlike the more common interim GC, they are rarely covering an absence or slotting into an existing team but are more likely adding a legal skillset that has so far been unrequired.
Increasing demand from fast-growing businesses
We are having more and more conversations with companies looking for fractional GC support today, and in many cases that demand is coming from growth clients that are looking to scale up and perhaps complete a fundraising round, pursue an acquisition or move towards an IPO. With pressures on costs and growing regulatory scrutiny, these businesses need senior legal input in-house but don’t necessarily want to commit to a full-time resource. Now that Covid has proved the concept of flexible working at all levels of an organisation, engaging a fractional GC makes sense.
A fractional GC might commit to a few days a week or come in for a few months to oversee a specific project, and they may be working for several other companies at the same time or balancing other commitments outside work. For fast-growing companies, the cost of hiring a permanent GC can be prohibitive, but there comes a point when legal advice is a necessity. A fractional GC that can bring industry expertise and experience dealing with all manner of legal issues, from employment to commercial contracts, litigation to real estate and so on, can be incredibly valuable.
The good news is that, just as companies are exhibiting more demand for this way of operating, we are also seeing a growing roster of legal professionals looking to work like this. The individuals that do this best are happy to step into an unstructured environment without an existing legal department and roll up their sleeves to support a business’ growth. They are comfortable in a non-hierarchical environment, may well have worked in-house before, and are just as willing to pick up the phone and instruct outside counsel as they are to negotiate a commercial transaction or get stuck into the latest compliance headache.
Value and expertise that’s highly cost-effective
There are many benefits for businesses when tapping into a fractional senior legal resource, perhaps the most obvious being the ability to work with an energised, fresh perspective at C-suite level who is able to focus on the job in hand while staying removed from any company politics. These arrangements also offer access to a wealth of experience and expertise in a format that is highly cost effective in relation to the amount of value delivered. Clients have the flexibility to seek the expertise and experience they need on a day rate, fixed fee or retainer basis.
Every fractional GC will come with a personal preference in terms of time commitment and working style, whether working on a project basis in the office or logging in remotely for a certain number of hours a month, so arrangements can be agreed that suit both sides.
Before going down the fractional GC route, however, it is important for businesses to be realistic about what can be achieved by an individual in the time available, particularly if there is no broader legal team in the business. Both parties need to be honest and transparent about expectations and deliverables, understanding that the consultant will have other commitments and may not always be at the other end of the phone.
Samengo-Turner says: “The history of fast-growth companies is littered with legal issues that could have been avoided if those businesses had had access to good internal legal advice. That is about having someone on your team who is there to protect you, helping you make more money, more efficiently, without making mistakes.”
How we can help
At Peerpoint, we have filled a number of fractional GC positions and seen them work well, particularly in the technology sector, fintechs in particular, and others such as the pharmaceuticals and healthcare sectors.
For the CEOs bringing on these individuals, it has proved invaluable to be able to access the insights of a seasoned legal expert who has seen many financings or M&A transactions before, because companies of this size are potentially less familiar with how those are executed. For senior legal consultants, the opportunity to act as an executive adviser with a seat at the top table in a fast-growing business can be really appealing.
The way lawyers want to work and companies want to employ them continues to evolve – if you would like to talk to us about how Peerpoint can help you meet your business’ commercial needs, please do get in touch by completing the short 'contact us' form on this page.