Mentors told St. Louis-based Jack Terschluse, a 2019 law graduate, that attorneys need at least five years of experience at a law firm before going in-house.

However, Terschluse took a position as corporate counsel at Balto, a tech startup that builds AI tools for call centers, in August 2021.

At that point, his experience was limited to two years as a corporate associate at the Lewis Rice law firm following his graduation from Washington University in St. Louis School of Law. 

“I always felt like I was drawn towards working in a business, but I didn't know how that would play itself out in my career," Terschluse, 29, told Legal Dive.

Terschluse, who was promoted to head of legal at Balto in August, said the COVID-19 pandemic was a key factor in his decision to join the tech company. 

He was only six months in as an associate when the global public health crisis hit. So instead of experiencing the camaraderie and knowledge that an office environment can provide, Terschluse was working remotely and decided to reassess his career path.

"I didn't necessarily feel as tethered to that five-year requirement as I would have if the pandemic had never happened," he said.

Terschluse’s role at Balto is one example of how recent law graduates are landing in-house jobs early in their careers amid indications that corporations have softened their expectations that attorneys have a certain amount of law firm experience.

A 2022 survey of more than 2,000 in-house professionals found that 17% went directly in-house after law school compared to 78% who previously had outside counsel experience, according to an Association of Corporate Counsel report.

However, the report said that “the percentage of attorneys that reported going directly in-house after law school is higher among those who more recently graduated as compared to those who graduated earlier.”

Large companies

Some of these young lawyers are landing in-house roles at well-known corporations. 

Phelan Simpkins, intellectual property counsel at State Farm, joined the insurance giant after graduating from the University of Missouri School of Law in 2021.

Even though the 28-year-old does not have law firm experience, he said, working for a company has given him opportunities to explore multiple areas of the law, such as state and federal regulations.

"It is actually pretty beneficial working for a company because the company is my client, but I also meet these other business areas that I counsel on different issues,” said Simpkins, who is based in Bloomington, Illinois.

Varied responsibilities

For entrepreneurial lawyers, in-house positions also offer an opportunity to learn how to grow a business, said Jeremy Muhlfelder, 29, head of operations and legal at VRChat.

Apart from having a passion for working with startups, the wide array of responsibilities also enticed New York-based Muhlfelder to go in-house.

A typical day can include implementing new contract management programs, recruiting, dealing with outside counsel and drafting NDAs, Muhlfelder said.

"It's really important for lawyers who make this move, especially the more junior ones, to not pretend like they know all the answers, because they won't," he said. "It's important to have that vulnerability and know how to raise your hand and say, ‘I need to get outside counsel involved on this.’”

Muhlfelder followed a similar path as Terschluse. He worked as an associate at Wilson Sonsini for 2.5 years after graduating from Duke University School of Law in 2018.

Muhlfelder and Terschluse said that startups at the beginning of building legal departments are often more willing to hire younger lawyers.

"I think in a startup, the opportunities for promotions and different leadership experiences are greater earlier on than they might be at a bigger company because there's not this big bench of people who've been waiting their turn to ascend to that leadership position," Terschluse said.

Challenging the status quo

Although Simpkins managed to land a job with a major employer, he said the traditional way of thinking about talent is persistent in the corporate world.

"I still think it's going to take more time for companies to really see the value add in taking somebody directly out of law school, or somebody with less than five years of experience coming from another sector of the law, to come in-house,” he said. 

Simpkins said a good reason for legal departments to change their approach to in-house hiring is that recent graduates can bring different legal perspectives about complicated issues that may benefit companies grappling with the constantly changing legal landscape.

"Having somebody who is coming out of law school who's had the theoretical training, but not necessarily the practical aspect of it, you're getting a fresh perspective on an issue of law or how the company manages certain issues, which can be refreshing," he said.