Starting and running your own law firm allows you the autonomy to pick and choose the kinds of cases you want to handle. But what happens when there’s no apparent market for the work that you love or where a market exists but the work isn’t financially viable?
A lack of market refers to a situation where there simply isn’t enough paying business to sustain a practice, irrespective of whether the lawyer engages in effective marketing and or has a stellar reputation. Lack of a market is frequently common with emerging industries – (as I learned when I was targeting ocean energy companies) of very narrow niche markets comprised of clients with limited resources (like representing student bloggers). Sometimes a lack of market might be geographic – such as a lawyer with oil and gas leasing experiencing who sets up shop in a state that doesn’t have any oil or gas resources or a lawyer who represents scuba dive operators in a landlocked state (and limits the practice to that jurisdiction).
In most cases, where there’s a lack of market for a practice area, there’s also a lack of financial viability. But not always. Consider for example, Tom Goldstein’s wildly successful Supreme Court practice. The Supreme Court hears just 77 cases a year – but at least a few of these cases involve deep-pocketed players able to shell out $100,000 for representation – which means that one case alone, if you’re lucky enough to find it, could theoretically sustain a bare-bones practice for a year (assuming no other income). By contrast, in other cases, sometimes there’s no market where there’s potential demand, but the business model isn’t financially viable – for example, a completely online, virtual practice handling unbundled matters only or a purely contingency-based practice in an area like Section 1983 where many public entities won’t discuss settlement until after summary judgment where a large percentage of cases are dismissed or representation of a demographic that’s too poor to qualify for legal aid but doesn’t have much extra to hire a lawyer.
So what’s a lawyer to do? Legal marketers won’t help here (though they may not admit it) because they don’t create markets but rather, come up with ways for lawyers to access existing markets. In fact, that’s why you’ll find most of the successful legal marketing operations assisting lawyers in building consumer based practices – personal injury, estate planning, bankruptcy, DUI, family law and the like. In most jurisdictions, there’s still enough consumer demand to sustain a reasonable, if not mid-six or seven figure practice in these areas, which makes them low hanging fruit for many marketing operations.
Of course, you could also consider giving up on your passion and finding another interesting and more lucrative practice area. Switching practice areas may be the only alternative if you’re buried in student loans or your kids are in college – and you may wind up loving the new area, or at least, the stable revenue that it produces. Nothing wrong with that. But for some lawyers, their second or their second or third choice just doesn’t make the heart sing – and that can stand in the way of success as well. More than anything, solos need to be self-starters, so if you find your chosen practice area lethally boring, you may wind up avoiding the work or delegating it to someone else so that you’re acting primarily as an administrator rather than a lawyer. Neither situation is likely to lead to long-term success or satisfaction – which for many lawyers was the point of starting their own firm to begin with.
Still, between the two extremes of giving up on work that you love or sticking to it and starving on the other, there are plenty of ways to strike a balance. Consider the following:
1. Identify other streams of revenue that can help to sustain work that you love. In the Tom Goldstein’s case, he created and taught two Supreme Court litigation clinics at Harvard and Stanford – but there’s no reason why a lawyer couldn’t propose a law school clinic that represents bloggers or a course on virtual law practice (in fact, Stephanie Kimbro teaches several such courses). Though adjunct positions don’t pay much, they can still cover some expenses (like office rent or malpractice insurance), while providing perks like access to law library resources and serving as reputation-enhancers. Moreover, today’s law schools are avid to find professors who can help educate students to solve tomorrow’s problems – so lawyers working in fledgling, emerging markets are bound to have an edge in finding an adjunct slot.
2. Explore ancillary services market Sure, you’re a lawyer so presumably you want to practice law. Even so, many law isn’t many clients’ first need – and if you can offer ancillary services in a limited market, you can generate an added stream of revenue. So for instance, if you represent an emerging industry, maybe you might offer lobbying along with your legal practice. A virtual law firm might also offer secure storage services for social media passwords or a scanning service that’s available to everyone, not just clients.
Keep in mind, though – just because a lawyers offer ancillary, non-legal services, ethics rules still apply.
3. Devise alternative ways to deliver your services. So maybe a blogger can’t afford to hire you – or you’re having difficulty breaking into the narrow area of IP appellate work. Instead of just selling traditional representation, why not create a $99 webinar series that educates bloggers about their legal rights, or a for-fee CLE that trains IP lawyers on the ins and outs of IP appeals, from identifying and preserving issues at trial to drafting a brief on appeal? You could also offer seminars and consultation services to law firms already handling these cases – perhaps a few hours of paid advice on one of these narrow matters. Or set up an online consultation service where you provide an hour of advice for a set fee. These price points may be low enough to attract some business – and if you’re working in a market that’s still emerging, you’ll be well positioned when the work eventually picks up.
4. Create an association . Back when I was trying unsuccessfully to get my ocean energy law practice off the ground (a challenge with only a handful of viable companies, few of which had any budget for legal fees), I eventually realized that traditional representation, even at my firm’s competitive rates, wasn’t going to get me very far. So I co-founded a trade association to work on policy issues for the industry rather than any individual company. Starting out, even much of that work was pro bono, but the association grew to where it could produce paid legal work – and as the industry grew (fueled in part by the trade association’s efforts), a few companies became viable enough to retain my firm.
5. Identify other funding sources If you can’t find sufficient individual demand for your service, there’s always the possibility of grants or funding. That’s the business model that Ted Frank used when he founded the Center for Class Action Fairness, a non-profit funded by grants. Perhaps you love the idea of defending homeless children in school bullying cases – not entirely financially feasible, but no reason why you couldn’t start a non-profit dedicated to that purpose and identify opportunities for grant or foundation funding.
6. Leverage your skills to subsidize the work you love If the practice area you love isn’t sustainable on its own even with the suggestions above, you can leverage some of your skills in knowledge to access more lucrative markets so that you can subsidize less profitable work. For example, if you assist vacationers in online mediation of legal issues arising out of rentals from sites like AirBnb, perhaps you can expand your practice to represent large companies in online mediation – for example, entering into a contract to handle multiple mediation cases in bulk. Though the work wouldn’t involve the same constituency (vacationers), the skills required are similar, and handling work for a larger company would help to subsidize the work for individuals.
Yes, I know that law is a business. But some of today’s most successful businesses — from Google to Gary V’s Wine Library to Georgetown Cupcakes were founded by entrepreneurs with an absolute and consuming passion for what they do. Lawyers shouldn’t have to settle for less – and with a little ingenuity, they don’t have to.