Lessons learned from hiring General Counsels for private equity funds and portfolio companies
Hiring General Counsels for private equity (PE) funds and their portfolio companies is a critical task that requires strategic foresight, alignment with business objectives, and a deep understanding of the unique challenges in these environments. Over years of hiring GCs for both PE funds and their portfolio companies, I have detailed eight key lessons to guide others in making informed hiring decisions.
1. Aligning legal expertise with business strategy
A crucial lesson is the need to align a GC’s expertise with the specific strategic objectives of the PE fund or portfolio company. For PE funds, this often means hiring someone with extensive experience in fund formation, regulatory compliance and deal structuring. For portfolio companies, the focus shifts to operational legal support, such as contract management, employment law, or sector-specific regulations.
Key Takeaway: Clearly define the business’s strategic priorities and seek GCs with specialised experience that directly supports those goals. Hiring a General Counsel for a portfolio company is not one-size-fits-all, it requires alignment from day one.
2. Balancing in-house and external counsel experience
GC candidates typically come from two primary backgrounds: in-house roles or law firms. Each brings distinct strengths. Law firm candidates often offer deep technical expertise and a broad network of contacts, whilst in-house candidates excel in pragmatic, business-oriented decision-making and cross-functional collaboration.
Key takeaway: Assess whether the role requires technical depth (favouring law firm candidates) or operational agility (favouring in-house candidates). Hybrid experience—candidates who have worked in both settings—can be a valuable asset. General Counsel roles often demand a blend of both perspectives.
3. Cultural fit is non-negotiable
PE environments are fast-paced, results-driven, and often leanly staffed. Hiring legal teams for private equity firms requires a careful balance of legal expertise and cultural fit, as a GC must thrive in this high-pressure setting while maintaining strong relationships with stakeholders, including fund managers, portfolio company CEOs, and external counsel. Cultural misalignment can lead to friction and inefficiency.
Key takeaway: Prioritise candidates who demonstrate adaptability, emotional intelligence, and alignment with the organisation’s pace and values. Behavioural interviews and reference checks are essential for assessing cultural fit.
4. Cost management and resourcefulness
PE funds and portfolio companies operate with a sharp focus on cost efficiency. A GC must balance high-quality legal support with budget constraints, often reducing reliance on external counsel. This requires resourcefulness and the ability to prioritise high-impact legal work.
Key takeaway: Look for GCs who demonstrate a track record of cost-conscious decision-making, such as insourcing legal work where possible or leveraging technology. The first hire for a GC often sets the tone for budget discipline and operational effectiveness.
5. Navigating the PE fund-portfolio company dynamic
GCs in PE ecosystems must understand the interplay between the fund and its portfolio companies. Fund-level GCs often oversee legal strategy across multiple investments, requiring a high-level view of risk and compliance. Portfolio company GCs, meanwhile, focus on day-to-day operations but must align with the fund’s exit strategy, such as preparing for an IPO or exit.
Key takeaway: Ensure GCs understand the PE lifecycle (acquisition, value creation, exit) and can balance fund-level oversight with portfolio company execution. Our PE and Portfolio GC community reflects the growing need for GCs who can operate across both levels.
6. Proactive risk management
PE funds and portfolio companies face diverse risks—regulatory, reputational, and operational. A strong GC anticipates these risks and implements preventive measures, rather than reacting to issues as they arise.
Key takeaway: Seek GCs with a proactive mindset, evidenced by past initiatives in risk assessment, compliance programmes, or crisis management.
7. Effective communication with non-legal stakeholders
GCs in PE settings frequently interact with non-legal professionals, such as investment teams, CFOs, and CEOs. The ability to translate complex legal concepts into actionable business advice is critical.
Key takeaway: Prioritise candidates who demonstrate clear, concise communication skills and the ability to frame legal advice in business terms.
8. Scalability and longevity
PE portfolio companies often undergo rapid growth or transformation, requiring GCs who can scale their legal function accordingly. Similarly, fund-level GCs must adapt to expanding assets under management or new regulatory regimes.
Key takeaway: Assess whether candidates have experience scaling legal functions or adapting to organisational growth. Scaling up an in-house legal team is a crucial part of ensuring long-term success. For long-term hires, prioritise those with leadership potential.
Conclusion
Hiring General Counsels for private equity funds and portfolio companies is a nuanced process that goes beyond legal expertise. Success depends on finding candidates who combine specialised knowledge with strategic alignment.
