Opening a Small Firm – How to Survive the First Three Years
The following is a guest post by attorney Branigan Robertson.
Starting a law firm isn’t easy. The first three years are the toughest. I opened my employment firm three years ago and it has certainly been a wild ride. Looking back, I realize now that most solo lawyers can survive on their own with a plan and a little bit of luck. But if you’re anything like me, you don’t just want to survive as a solo lawyer, you want to thrive and kick some serious legal butt.
Below are the essential things attorneys must do in order to thrive after opening a law firm:
- Only Take Clients You Trust
You can’t practice law without clients, but you can practice law without bad clients. Clients can make your life miserable; bad clients lie, demand unreasonable results, and sometimes their motives are simply evil. Any one of these contingencies can wreck havoc on your success as a small firm lawyer.
Here is the number one key to success in your early years – DON’T EVER TAKE A CLIENT UNLESS YOU TRUST THEM! Screen your clients as best as you can. The money is never worth the agony that comes from a bad client. This is especially true if you’re a contingency lawyer and you’re gambling on the case outcome. Bad clients generally lead to bad outcomes. Trust me, I know.
- Law is a Business – Treat it as Such
There are lawyers out there who don’t think that the practice of law is a “business” in the traditional sense. That is ridiculous. At its basic level, lawyering is a service in exchange for monetary compensation. Therefore, unless you’re taking a case pro bono, you need to pay attention to the bottom line.
Fundamentally, this means that no matter how great your lawyering skills are, you will never thrive as a solo practioner if you are constantly under financial stress. It’s impossible for you to focus on the motion, pleading, or deposition at hand if you’re worried about how to pay for this month’s mortgage.
Here is the key concept I want to convey – if you treat your firm like a business you will have more opportunities to use your magnificent legal skills to benefit your clients and future clients.
- Find Your Niche and Repeat it Over and Over and Over
Everyone has heard the phrase – “Niches to riches.” While the cliché is true for the practice of law, it is lacking a critical element. You also need to streamline and repeat your niche legal service over and over and over.
The most successful solo practioners I know do one thing and they do it well. But that is not the magic. The magic is that they repeat their service thousands of times. For example, the successful mediators in employment law mediate two to four cases a week. Employment mediation is the only thing they do. They charge anywhere between $4,000-$10,000 a day. If they keep that pace week-in and week-out simple math will show you what kind of “riches” they are earning.
- Bad Days Happen to Everyone – Get Over It
The best surfers don’t catch every wave. The best lawyers don’t win every case. Despite your exquisite legal writing, sometimes the judge will ridicule you in open court. I personally guarantee that opposing counsel will sometimes treat you as if you’re an incompetent piece of garbage. Sometimes it’s difficult to “thrive” when the whole world seems to hate you.
But take heart. Storms always pass. If you heed the following precautions you won’t sink. First, find several legal mentors. When an issue arises, call them and admit your failures. They will calm you down and help. Second, realize that your mental toughness will grow the longer you’ve been practicing law. So take a few days to feel bad for yourself and then get back to the helm and steer your ship.
- Find a Repeatable Source of Clients
It’s pretty hard to thrive if you’re constantly starved for clients. Therefore, you need to make it a huge priority to find a consistent source of clients. I know this is much easier said than done, but this should be a top priority. Here are a few quick tips:
- Become friends with people who interact frequently with your target clientele and then politely ask them for referrals.
- Join a referral network.
- Advertise on Findlaw, Nolo, Avvo, or one of those platforms.
- For Pete’s sake – please build a decent website!
It’s been three years since I hung my shingle. I’ve learned that the difference between thriving and surviving is following these tips. While I am definitely not perfect (and have failed to follow my own advice on several occasions) you can trust that these five tips are well vetted and will help your law firm dreams become a reality.
About the Author
Branigan Robertson is a plaintiff’s employment lawyer in Irvine, California. He graduated from Chapman University Fowler School of Law in 2012 and opened his law firm’s doors immediately after he passed the bar. He has written several articles on law practice management including “How I Started My Own Law Firm Right After Law School.”
Great advice … though in my case, I would say the first five years are the toughest (perhaps I am a slow learner). I would also add that outsourcing administrative tasks is an important aspect of being a solo. When I started my firm five years ago, I tried to do everything myself – find the clients, do the work, handle the admin. I’m a bit stubborn, so it took a while to admit, but one of the three pillars referenced had to go. I was definitely the one who would do the legal work, and because of my relationships in the entertainment industry, I was also the one who would find the clients. Thus, I had to let go of the admin (not that I loved it … more of my own control issue, I think). About a year in, I distinctly remember a call to a friend who has an accounting / bookkeeping business while I was in the midst of an “I can’t do this anymore” crisis moment. She got me back on track by taking over the accounting and billing for my firm (funny how if you don’t bill timely, you don’t get paid either … see second para. of point #2). While we’ve continued to tweak the process overtime, I can say without a doubt outsourcing admin was the best decision I’ve made for my firm and for myself.
Great advice but #3 will only work in a market with lots of potential clients needing that particular service, such as will be found in any major metropolitan area, for instance. If you are setting up in a more sparsely populated area – think of the rural areas of US States or Canadian Provinces – you have to provide a broader range of services. You cannot do everything but, with some effort you can handle a lot of the basic services most clients will want from the new lawyer in town. The work that requires a specialist can be referred to a specialist, thereby creating the likelihood of referrals coming back; the specialist will not be taking on a DUI or a basic Will or an uncontested divorce.
Don’t be shy of a small-town practice. It is challenging but it may be the quickest way to the role of “trusted advisor” for many clients. That has rewards over and above the dollars.
Both of you identify out great points. Every situation is different and each lawyer should adjust as necessary.
Its really tough to find a trust able client.I am also an enterprenuer and with the time it’s not about having a trust able client the things is you have to create a trust able relationship with your client.
The great lines you quoted here. Agreed with it “if you treat your firm like a business you will have more opportunities to use your magnificent legal skills to benefit your clients and future clients.”
Shallow. One would do far better to read The Practice, by Brian Tannebaum, along with The Curmudgeon’s Guide to Practicing law, by Mark Herrmann, not to mention brutally realist blogs like Scott Greenfield’s Simple Justice or Jordan Rushie’s Philly Law Blog.
Among other Millennial snowflake fantasies they reject is the notion that law is primarily a business rather than a profession, or the “magical powers” of social media.
The fact of the matter is that there are too many lawyers chasing too few clients. Demand in many areas of law has been shrinking for years now – such as
~bankruptcy/insolvency because debt defaults are at or near record low levels (except subprime car loans);
~crime has been going down nationally for years (although there’s a been a slight uptick since Ferguson);
~personal injury/defense has been dropping precipitously as people are driving less and tort reform
~payouts on PI cases are lower due to case valuation software
~Gen X and Millenials have some of the lowest divorce rates in a generation and when they get divorced there is little if any equity in the homestead to pay off attorneys fees
below are some case filing statistics for my midwestern state. I’m sure its not formatted correctly but the point is that new case CIVIL filings in 2014 have dropped by 28.9% since 2010 which was supposedly a bad legal year (due to the end of the recession).
Category Caseload Statistics 2014 2013 2012 2011 2010
Filed 457,444 513,928 554,747 555,088 643,740
It’s like this throughout the state for all types of cases:
Year 2014 2013 2012 2011 2010
Filed 2,930,986 3,174,144 3,281,100 3,380,512 3,757,112
It’s a structural thing and networking, advertising, praying to Saxnot, none of it’s going to help when the # of lawyers is exponentially increasing the the amount of legal work is precipitously dropping.
Branigan is a amazing lawyer, if you are looking for advice as a lawyer follow his plan I was blessed to have such a understanding and hard working lawyer thanks to him I had a settlement in 3 months an was payed out with in 7 days of our settlement great guy an great lawyer