Building on Paul's comment above, lawyers are often very specialized. Find one -- or more -- specialized in the type of transaction or matter you are facing. Forming an LLC or other legal entity may not require a lawyer. Don't hire a litigator to form a fund, or an M&A lawyer for your bank loan, or a tax lawyer for your employment agreements. It can be difficult to find the right person for the job. Often lawyers that service small companies, or specific industries may have general experience about a variety of issues that impact that area, and that can be helpful. A good lawyer should let you know where her or his strike zone is and when refer you to someone else (in their firm or elsewhere for). Be willing to ask "are you an expert in X area?" and "do I need an expert in Y area?" When you say "hire" if you mean hiring someone as a full time employee of your fund, that seems very unlikely for a search fund, unless that person is going to do a lot more than "legal" -- your company or companies you buy may need an in-house lawyer depending on size, exit plans, regulatory environment, and lots of other factors. But small companies typically can't afford good lawyers, and even when they can, they may need external litigators or other specialist advice from time to time. Happy to talk offline -- I have 12+ years of being a lawyer, mostly in-house with companies where I have spent a lot of time hiring and supervising external counsel. However, if you are not sure what the risks are, or what the document you are about to sign means, or how to turn your handshake or LOI into a deal that protects your interests, you can save a lot of regret by talking to a lawyer before you're in a bad situation.

Good lawyers are an essential part of your team. As Mr. Smith above points out, you will most likely end up working with several specialists so hiring an in-house legal counsel may not be the best solution unless your firm is of a certain size. If your questions refers to whether you should hire someone with a legal background for your fund of for the company you are acquiring, that is another question altogether.