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When to hire an in-house lawyer in SaaS

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When to hire an in-house lawyer in SaaS - Contract Sent

Started to get some traction and finding that legal requests are coming in left, right and center? End of quarter crunch grinding your legal team to a halt? Running a SaaS company will have you chasing legal all day long. And legal issues are a part of everyday business operations, especially when you’re starting to close deals faster and faster (that’s the dream, right?). From negotiating contracts to protecting intellectual property, fun with legal can be time-consuming and complicated (jaded much?). As your SaaS contracting needs grow, you may start to wonder when it’s time to hire an actual headcount for your legal team and bring a lawyer in-house. Here are some factors to consider to know when to hire an in-house lawyer for your startup.

Complexity of Legal Issues, or Complexity of SaaS Contracts

One of the most important things to think about when deciding whether to hire a SaaS lawyer in-house for your startup is just how complex your legals are and how complex your contracting process is becoming. If you find that you are dealing with a lot of customers that don’t want to contract on your standard terms and this is coming up on a regular basis, and the issues are complex or involve multiple jurisdictions, especially when you’re selling into other countries you’re not familiar with, it may be time to hire an in-house lawyer that can give you more access to expertise. An in-house lawyer can provide legal guidance and advice on a variety of issues, including contract negotiations, intellectual property, data privacy, and regulatory compliance.

When the Cost of Outside Counsel Grows

Legal talent is costly and if you continue to pay by the hour the way that most external lawyers will charge, it will start to hurt, a lot. If you are regularly engaging outside counsel for legal services, the cost can quickly add up. By hiring an in-house lawyer, especially a salaried one, you can reduce your legal costs and have greater control over your legal budget. One of the reasons for this is having a lawyer that knows your product inside and out. This knowledge will help them redline customer contracts in no time because they know what can and can’t be agreed to. An in-house lawyer can also help you identify legal issues early and prevent them from becoming more costly and time-consuming down the road.

Am I big enough to need one?

The number of deals that you are doing and the speed at which your SaaS company is scaling up is also another thing that you need to forecast when you look to hire in-house.. If your company is dealing with a couple of deals a month or just use a contract template to work off and you are not dealing with complex legal negotiations on a regular basis, it may not make sense to hire an in-house lawyer. However, as your company scales and your deals or product offerings become more and more complex, it might be a good time to bring legal expertise in-house.

Company Approach to Risk

Your companies approach to risk and the culture and values that are born out of this are also important factors to consider when deciding whether to hire an in-house lawyer. If you prioritize legal compliance and your product operates in a space that legal compliance is extremely important, it may make sense to have a lawyer on staff who can help ensure that your company is operating in compliance with the law much earlier and putting in place a contract management policy. Think of SaaS companies in FinTech or InsuranceTech or products that deal with a lot of personally identifiable data. Additionally, an in-house lawyer can help you navigate legal issues that align with your company’s values, such as data privacy and intellectual property protection.

When to hire an in-house lawyer and their benefits

There are a lot of benefits to hiring an in-house lawyer for your SaaS company. An in-house lawyer can provide legal advice and guidance that is tailored to your products unique use cases and circumstances. They can also work more closely with your sales teams to help identify legal issues early and provide proactive legal guidance. An in-house lawyer can also help you negotiate contracts more effectively and protect your intellectual property more efficiently.

Furthermore, an in-house lawyer can help you manage legal risks and regulatory compliance. They can provide legal training to your employees, and ensure that your company is complying with applicable laws and regulations. An in-house lawyer can also help you manage legal disputes more efficiently, which can save your company time and money.

In the end, deciding whether to hire an in-house lawyer for your SaaS startup requires a lot of consideration. If you are constantly dealing with complex legal negotiations and your product is driving this, if you are concerned about the cost of external lawyers, and prioritize legal compliance, it might be time to hire an in-house lawyer. An in-house lawyer can provide specific legal advice, work more closely with your head of sales and sales team, and help you manage legal risks and regulatory compliance. By hiring an in-house lawyer, you can ensure that your company has the legal expertise it needs to succeed as you scale your SaaS offering up.


Contract Sent is not a law firm, this post and subsequent pages on this website do not constitute or contain legal advice. To understand whether or not the ideas and guidance on the Contract Sent website is applicable to your business, you should consult with a licensed attorney. The use and accessing of any resources contained within the Contract Sent site do not create an attorney-client relationship between the user and Contract Sent.


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