Outsourced Legal Services

By Karen Fischer                                                         March 14 , 2010

When you started your business and determined you needed a lawyer for a particular reason, did you find yourself calling someone you knew or someone a friend recommended and didn't really look to see if they were really the person or firm to provide you the best counsel on what you needed?   So many times this is the case and can be such a mistake and end up costing you more than you really need.  Just because someone charges $500.00 an hour and is on Bay Street in Toronto, this does not mean they are the right lawyer for the service you need.

Lawyers specialize just like any other profession, and just because a lawyer you know is good at real estate transactions, it does not mean they can provide you with sound advice on employee grievances or service agreements.

Too many times start-ups and small businesses bypass legal services for fear of the cost, but this is a mistake.  If you don't look out for your company in the beginning, you may not have a company to build.  There is a way to do this cost effectively and get the services you require.

Outsourced Law Firms

It would be nice if every business could afford their own Corporate Counsel, as having someone on staff who truly understands your business is always better than opening the Yellow Pages when you require legal services.  Unfortunately start-ups and small businesses cannot afford to have a lawyer on staff and would not be able to keep them busy full time even if cost wasn't an issue.

In many jobs I have had over the years, I have had the luxury of working for large companies who had in-house Counsel.  Working in positions in sales and marketing where contracts where in high demand, it was great to have someone guide you that understood what was needed and knew the business.  In turn, you learn from them what is required and what to look for when you receive contracts from the outside.  When you then move to a small business or start-up, you find you were spoiled and when you need the same contracts, they end up costing you more than you bargained and you don't have that same relationship with outside lawyer.

In my last start-up job, I was in a position which required several distribution contracts created.  The current law firm representing the company was over $500.00 an hour and wouldn't know a distribution contract if they fell over it. Templates I had for contracts were way too much for a small business as well.  What you also tend to find, due to the cost, many contractual agreements are created without even involving a lawyer, which is a very large mistake.  The money you think you saved by not using one can land you in litigation down the road with a customer, partner, or employee by not having proper due diligence through a law firm.

Over 2 years ago, I  attended a technology event where I ended up meeting the Co-Founder of an outsourced law firm whose main focus is to support  start-ups to small-medium size businesses who cannot afford a full time Corporate Counsel.  The Partners and Associates at this firm have held  Corporate Counsel positions in many large businesses in a variety of industries and sectors.  It turns out there were several who were from the high technology sector where a lot of time is spent on various contracts from sales, service, distribution, and various types of partnership agreements, and was exactly what I needed.  The firm could either provide counsel on a part-time basis for various needs and choose the right lawyer based on your requirements or could actually provide project-based work which is what I required at the time.  You also only end up paying for the services you require and not the email you sent asking a pertinent question or for the staple in the top corner of the document.  This is a true outsourced model, without the retainer and nickel and diming you get with large law firms.  You only pay for services rendered.

Through a few of my on-line networks I began uncovering that firms like this are starting to pop up all over the world.  Someone that is in my Linkedin network in the U.K was telling me they had dealt with a similar firm and their fee structures were along similar lines. This truly makes a lot of sense, and hope to see more over time.

An outsourced law firm can provide you with different legal specialities you might need without going to multiple law firms.  You will have consistent representation from a firm that understands your business with a constant and cost effective fee structure to meet your needs as a start-up or small business.

Canadian Recommended Firm

I am sure there may be other law firms in Canada that provide this type of model, but for anyone in Ontario, I highly recommend looking at Cognition LLP which is in downtown Toronto.  I have known and worked with this firm for the last 2+ years and couldn't imagine using anyone else as a small business myself.  I used this law firm in a previous position to create several distribution contracts in a previous position at a telecom company.  The Associate that worked on my contracts had actually held been on the legal team at several telecom companies and been Corporate Counsel at one as well, so truly understood what was needed. 

The lawyer I worked with and the Co-Founder of this firm made the experience feel more like one of having an in-house Counsel versus just working with an outside law firm.