Building a professional portfolio without real-life projects?

I was recently laid off from an in-house position I've been in for the past 3 years, and my portfolio is still the same as when I was out of school - basically all student work.

I can add a couple of editorial projects from my in-house position, but everything else I've worked on while there is tacky and not portfolio worthy, even if it's been "big" projects like e-commerce design, the process has been wacky and the art direction chaotic. Even the little freelance work I've made isn't too creative, so now after 3 years I have next to nothing to show for my experience.

Can I just make up briefings that would make interesting projects and build my portfolio that way? Are "fake" projects ok to add to a portfolio if presented well, or do recruiters at agencies look for real-life work after 3 years of experience?

Or would you look for freelance projects on Fiverr or even locally, even if they're not that well paid, and try to make something outstanding so that the project is real and quality?