The Vice President of Legal or “VP of Legal” as most of us call it, is not a new title for in house attorneys, but it’s not a terribly old one either. It has emerged as a popular title for top Legal Eagles in emerging growth companies as well as key lieutenants to the CLO/GC in public companies and select late-stage startups. Over the years, compensation has increased for this crew – and the attorneys who hold this title vary in their backgrounds and expertise.
In today’s market, there are currently four primary types of VP of Legal (I bet you didn’t know that!). Below is the 411: the types, the profiles…and, of course, the Numbers.
(1) VP of Legal – Sole Attorney, Startup Company
Otherwise known as “GC Light” in emerging growth companies, the VP of Legal is typically the top attorney who is tasked with running the department. In some startups (particularly early stage), they are a lone wolf whose job is to create a legal infrastructure, organize the department and lead the Block and Tackle for the company’s most pressing legal matters (usually commercial and sales). Reporting structure is to the CFO, COO or Head of Finance, without membership in the Executive Management Committee Club, but there can be some decent Board contact. A second, junior hire is typically approved and hired within 5-8 months of the VP of Legal‘s start date, which provides air cover in areas such as commercial, product and/or privacy.
The typical profile for this level in the context is an attorney with heavy commercial experience – which could encompass SaaS, sales and/or general commercial. A smattering of “other” experience may also be present (like product and privacy), which is an added bonus for an employer. Those who transition to this role were previously either a Senior Director, AGC, DGC, VP of Legal in other startup or a GC of an earlier stage start up.
Compensation:
- Base Salary: $285k – $315k
- Target Bonus: 20%-25%
- Stock Grant: .03%-.2% or if you calculate by value: $750k-$1.2m (Options. 1 year cliff, 4-year vest)
- **For those in “lower cost of living” areas, deduct 5%-10% from these numbers
(2) VP of Legal – Team Leader/Manager, Startup Company
This role is also known as GC Light, but it’s bumping up…and sometimes into a prototypical GC level and function. This attorney walks in the door of a startup (typically mid to later stage) with a turnkey team – anywhere from 2-8 legal professionals (give or take). They audit the current structure and infrastructure, and dab on any finishing touches to the department, if needed.
This attorney works closely with the top execs and can have a seat at the table, although sometimes it’s “informal” at first. Executive expectations are for this lawyer to be a strategic thought leader and play a proactive role in pushing business forward. And…“Don’t just be reactive on legal matters, be proactive!”. CFO/COO report is most common, but a small, increasing number are reporting to the CEO.
The attorney profile transitioning to this role is typically broader in experience/years than the solo VP of Legal and includes prior management experience. So, Commercial, General Corporate, Privacy, Product, Employment…and Regulatory where needed. Prior Board pretty much required, but not always. Prior leveling: Sr. Director, DGC, VP (startup or public company), GC of a mid to late-stage startup (with a team).
If this VP of Legal performs well, they will be promoted to General Counsel within 12-18 months. If they do not meet expectations, executives will often replace this attorney with a GC/CLO from the outside when the time is right.
Compensation
- Base Salary: $325k – $350k
- Target Bonus: 25%-30%
- Stock: .08%-.3% or if you calculate by value: $1.3m – $2.5m (Typically options, but a select few will offer a hybrid of options and RSUs. 1 year cliff, 4-year vest)
- **For those in “lower cost of living” areas, deduct 5%-10% from these numbers
(3) VP of Legal – Startup Company (#2 Lawyer)
It’s rare, but there are startups, mostly in late stage who have a VP of Legal on the team reporting to a GC/CLO. These attorneys are the true #2s and right-hand people in the legal department. They tend to function like a DGC, often possessing a broader substantive background or a specialty so relevant and valuable to the company, that it merits more supreme title recognition. This attorney can manage a team and assumes a robust amount of blocking and tackling duties in the department. This VP of Legal title is not as common in startups when a GC/CLO is already in place. So many times, employers offer the title to the most highly sought-after and hardest to land candidates as a recruiting strategy, or to retain a tippy top performer.
This VP of Legal will be in prime Heir Apparent position should their boss leave for greener pastures. But it’s not a lock if the execs don’t believe they have the executive chops to fill the higher-level shoes.
Compensation
- Base Salary: $300k – $350k
- Target Bonus: 20%-30%
- Stock: $1m – $1.7m value (Typically options but could be a hybrid of options and RSUs. A select few will offer pure RSUs. 1 year cliff, 4-year vest)
- **For those in “lower cost of living” areas, deduct 5%-10% from these numbers
(4) VP of Legal – Public Company
It used to be that the Deputy General Counsel was the only title in town to represent a #2 or key lieutenant in a public company legal organization. Not anymore. The growing trend in public company legal departments is to add a VP of Legal to the title sandwich board. It’s not a title norm in this context…yet. But it’s been used strategically by savvy GC/CLOs as another title layer and to recognize senior contributors and star athletes. There can be one or a few VP of Legal attorneys in the department. They can be narrow (Corporate Securities, Privacy, Commercial etc) or they can possess a utility player profile. Those who own the title love it too. Why? Cuz it showcases their VP feathers and… cuz it sounds important.
Compensation
- Base Salary – $350k – $400k
- Target Bonus – 35%-40%
- Stock – $1.2m – $2m (RSUs, 1 year cliff, 4-year vest with annual refresher that equal 20%-30% of the original grant)
- **For those in “lower cost of living” areas, deduct 5%-10% from these numbers
The Vice President of Legal is a role that can exhibit different faces in different types of companies. Its evolution is continuing and the frequency with which we see such roles is increasing. I like the way this role is presenting itself as a career option for lawyers. The mushy market has its compensation in treading water status, but as the market improves so will the numbers.