Most growing companies hire a full-time lawyer later than they hire finance or sales leaders, and some of them pay for it in law firm bills. The clearest test for when to bring legal in-house, full-time or fractional, is how much you already spend on outside counsel and how much of it is routine.
The full-time math
A general counsel at a $20M to $100M company typically earns $200,000 to $330,000 in base salary, with a bonus and often equity. Payroll taxes and benefits add 20% to 25%. Legal recruiters charge 25% to 30% of first-year cash. Year one all-in runs roughly $250,000 to $450,000. A first in-house lawyer at a smaller company, with a title like senior counsel, costs less, around $150,000 to $220,000 base.
The fractional math
Fractional GC retainers typically run $3,000 to $15,000 a month, about $36,000 to $180,000 a year, for 10 to 40 hours a month. Hours above the retainer are billed at an agreed rate. Month-to-month terms with a short minimum are common.
The outside counsel test
Add up last year’s legal bills. If routine work, meaning contract review, employment documents and corporate housekeeping, accounts for $100,000 or more, a fractional GC will probably cost less and know the business better. If total outside spend is approaching $250,000 to $400,000 a year and most of it is routine, a full-time GC begins to pay for themselves. Specialist work such as litigation, patents, complex tax and large transactions stays with law firms either way.
Where full-time starts to make sense
- Under $10M, a few contracts a month: a law firm as needed, or a fractional GC at 10 hours a month.
- $10M to $50M, weekly contract negotiation: fractional at 20 to 40 hours a month, often with a contract manager or paralegal handling intake.
- $50M to $100M, high contract volume or regulation: the switch usually happens here, often to a first full-time lawyer reporting to the CEO or CFO.
- Over $100M, international operations, a regulated industry or IPO preparation: a full-time GC, often with a small legal team.
What you lose with fractional
You lose a lawyer embedded in daily decisions. In-house lawyers spot problems in meetings before they become contracts. A fractional sees what is sent to them. You lose speed on urgent matters, such as a customer contract that must be signed by the end of the quarter, unless the agreement sets response times. You lose some business judgment built from daily contact with sales and product. And a full-time GC becomes a senior adviser to the CEO and board on issues beyond pure law, which a fractional at 20 hours a month rarely does.
What you gain
You gain senior legal judgment at a cost proportionate to the work. You gain someone who manages outside counsel and keeps those bills in check. And you gain a lawyer who can tell you, from experience at several companies, which risks are normal for your size and which are not.
The sequence that works
Start with a fractional GC who builds templates, cleans up records and sets a contract playbook. Add a contract manager or paralegal when volume grows. Hire a full-time GC when routine outside spend plus the fractional’s fees approach a full-time salary, or when regulation or a transaction requires a lawyer in the building.