Should I Switch My Company From Big Law Hourly Billing to Fixed-Fee Outside Counsel?
The Question Behind the Invoice
Am I getting my money’s worth from the firm billing me by the hour?
I check my invoice from last month against the one from three months ago. The number moves. A quick contract review costs a different amount depending on which associate touched it, and my finance team can’t forecast legal spend from that.
My company keeps growing at the same time: more contracts, more hires, more investor questions, and all of it billed at $600 to $1,200 an hour. That’s the point where it’s worth asking whether fixed-fee or subscription Outside General Counsel, OGC for short, fits where my company is now. OGC means ongoing legal coverage for a flat fee instead of a new invoice every time I call.
How OGC Works in Practice
What an OGC Engagement Is
OGC is an ongoing relationship. A firm handles my recurring legal needs for a set fee instead of sending a new invoice every time I have a question, and I get a lawyer who already knows my business and my risk tolerance.
What a Typical Month Under OGC Covers
A well-scoped OGC engagement usually includes:
- Contract review and drafting for customer, vendor, and partner agreements
- Employment matters: offer letters, terminations, classification questions
- Routine corporate housekeeping: board consents, cap table updates
- On-call advice for day-to-day questions that used to feel too small to call a lawyer about
Big transactions and litigation stay outside the flat fee and get billed separately.
How the Switch Gets Scoped
Moving from big-law hourly to fixed-fee OGC means scoping the engagement properly. Pull the last 12 months of invoices to see what work recurred, define the scope of matters covered with carve-outs for anything larger, and agree on overage rules upfront so a busy month isn’t a surprise bill.
How to Tell If the Switch Saves Money
The comparison that matters is total annual spend against total annual coverage, not one invoice against one flat fee. A cheaper monthly number that excludes half of what my company needs isn’t a win.
Common Founder Mistakes
- Switching Without Reviewing Real Usage First. Founders switch based on sticker shock from one bad invoice rather than a real picture of what recurs monthly. Without that data, there’s no way to know if a flat fee covers what the company needs.
- Assuming Fixed Fee Means Unlimited. Founders sign an OGC agreement expecting it to cover everything. When a matter falls outside scope, the firm either bills it separately and the founder is caught off guard, or absorbs it and coverage quietly degrades.
- Moving Off Big Law With No Transition Plan. Founders end the big-law relationship the same week they sign new counsel, with no overlap to transfer knowledge. Open matters and deal history get lost right when the company can least afford a gap.
10-Minute Self-Check
Before I decide whether to switch to fixed-fee OGC, I work through this:
- Have I pulled 12 months of legal invoices to see what recurs?
- Do I know which matters stay outside a flat-fee scope (M&A, litigation)?
- Have I gotten a written scope of what the engagement covers month to month?
- Do I understand the overage rules before a busy month hits?
- Am I comparing total annual spend, not one invoice against one flat fee?
- Do I have a plan to transfer open matters from my current firm?
- Is my legal need predictable enough for a flat fee to make sense now?
If I can’t answer yes to most of these, I’m not ready to make the switch yet.
Bottom Line
Fixed-fee outside counsel isn’t automatically cheaper. Hourly billing isn’t automatically wasteful. What matters is whether scope matches the legal work a growing company generates every month. Get that wrong, and the savings disappear the first time a matter falls outside it.
Ready to See What a Flat-Fee Legal Package Would Actually Cover for My Company?
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