General Counsel
Outside General Counsel vs In-House Counsel
Written and reviewed by Andrew R. Schneidman, Esq. · Last reviewed
Outside general counsel and in-house counsel perform the same job in two different employment structures: an outside general counsel is a contracted attorney serving the business through an ongoing engagement, while in-house counsel is a full-time employee serving one company. For businesses between $1 million and $20 million in revenue, outside general counsel delivers the coverage of the role without the cost of an executive hire.
Schneidman Law provides outside general counsel to businesses in Middle Tennessee and nationwide on a flat monthly fee, with no hourly billing and hours never counted. Andrew R. Schneidman spent years as general counsel of a large construction and real estate development company, so the comparison below comes from having sat on both sides of it.
What is the difference between outside general counsel and in-house counsel?
The difference is employment structure. In-house counsel is a salaried employee dedicated to one company full time. Outside general counsel is an independent attorney engaged on a subscription basis who performs the same function: contracts, employment, vendors, strategy, and risk.
Both roles carry the same responsibility: know the business deeply, review what it signs, and flag risk before the company commits. The in-house lawyer does it from an office down the hall. The outside general counsel does it from a law practice, for a defined set of clients, with the same continuity and the same expectation of being called first.
The practical differences show up in three places: what the role costs, how much legal work it takes to justify the role, and how broad the attorney's experience base is.
What does in-house counsel cost a business?
In-house counsel costs a full executive compensation package: salary, benefits, payroll taxes, office space, software, and continuing education. The business pays that cost every month whether the attorney's week is full of legal work or not.
The cost problem is not the number itself. It is the mismatch between a fixed full-time expense and a variable legal workload. A business doing $5 million in revenue signs real contracts and makes real commitments, but it rarely generates 40 hours of legal work every week. The company ends up paying for capacity it does not use.
Outside general counsel prices the role to the actual workload. Schneidman Law structures it as a flat-fee monthly subscription across three levels of involvement, so the business pays for depth of engagement rather than a seat at a desk.
What are the advantages of in-house counsel?
In-house counsel offers physical presence, total dedication to one company, and immersion in daily operations. For companies generating heavy daily legal work across multiple departments, a full-time lawyer in the building is the right structure.
An employee attorney absorbs the company's culture, sits in every leadership meeting, and hears problems in the hallway before they become matters. At sufficient scale, usually well past $20 million in revenue with constant contract flow, regulatory obligations, or a large workforce, that immersion earns its cost.
The honest answer for most growing businesses is that they are not there yet. The workload justifies a general counsel function, not a general counsel salary.
What are the advantages of outside general counsel?
Outside general counsel offers the full general counsel function at a fraction of the cost of a hire, plus breadth: an attorney who sees deal structures, contract terms, and vendor tactics across many businesses instead of one.
The following are the 4 structural advantages outside general counsel holds for a business under $20 million in revenue.
- Cost matched to workload: a flat monthly fee instead of a full-time compensation package
- Breadth of experience: the attorney negotiates across many companies and industries, so your counterparty's tactics are rarely new
- No management overhead: no hiring, onboarding, benefits administration, or backfill risk
- Scalability: the engagement moves between levels as the business grows, without a hiring or termination decision
Andrew’s take
Outside general counsel is a model most small businesses should seriously consider. A full-time in-house attorney comes with a full compensation and benefits package that most growing businesses do not generate enough legal work to justify, especially with how much can now be handled remotely. The attorney running your legal function does not need to sit in your office full time.
When should a business hire in-house counsel instead?
A business should hire in-house counsel when legal work fills a full week, every week: constant contract volume, daily employment matters across a large staff, heavy regulatory obligations, or transaction flow that demands an attorney in every internal meeting.
That threshold arrives for most companies well above $20 million in revenue, and for many it never arrives at all. Until then, hiring in-house means paying executive compensation for a role the business only partially fills.
The two models also combine. Companies that make their first in-house hire keep outside counsel for overflow and for domains the new hire does not know. Moving from outside general counsel to in-house is a graduation, not a rupture, and a good outside counsel tells you when you have reached it. If you are still deciding what the role itself involves, start with what an outside general counsel is.
Frequently asked questions
Can outside general counsel really function like in-house counsel?+
Yes, for the workload most growing businesses generate. At Schneidman Law, Level II Ongoing Counsel includes document drafting, live counsel calls, priority responsiveness, and involvement before the business makes commitments. That is the working rhythm of an in-house lawyer, delivered without the full-time salary.
Does an outside general counsel know the business as well as an employee would?+
The engagement is built for exactly that. The attorney learns the company's structure, key contracts, people, and risks at the start, then stays involved continuously. Knowledge compounds the same way it does for an employee, because it is one attorney in an ongoing relationship, not a rotating cast.
Is outside general counsel billed hourly like traditional law firms?+
Not at Schneidman Law. Outside general counsel is a flat-fee monthly subscription with no hourly billing and no surprise invoices, and hours are never counted at any tier. The fee is fixed by depth of involvement across three levels, so calling your attorney never costs extra.
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