Fund managers rely on outside counsel for a surprisingly broad swath of legal needs, ranging from basic fund-formation work to navigating the ever-changing information privacy landscape. Although GCs of fund managers could theoretically have all work performed by a single law firm, that is rarely the most cost-efficient approach. Instead, GCs need to retain a stable of legal experts and allocate work among them to achieve the best cross-section of expertise and cost effectiveness. To aid GCs in their efforts, the Private Equity Law Report surveyed the best practices of several attorneys with experience working at law firms, fund managers and portfolio companies. This final article in a three-part series identifies situations in which a fund manager should pay a premium for legal services, along with others where lower-cost alternatives (e.g.
, compliance consultants) can be used. The second article
detailed criteria for selecting outside counsel, and the first article
explored ways to reduce legal costs and outside counsel fees. For more on structuring a firm’s internal legal and compliance efforts, see our two-part series: “Benefits of Having a Dual-Hatted GC/CCO, and Alternative Solutions for Fund Managers
” (Apr. 30, 2019); and “Challenges and Recommendations for Simultaneously Serving as GC and CCO of a Fund Manager
” (May 7, 2019).