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Why Don’t Law Schools Invest In Law Firm Start Ups?

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Last weekend, I attended my 25th law school reunion up at Cornell Law School.  Considering that the Class of 1988 was Cornell’s centennial graduating class and that the silver anniversary is fairly significant, the turnout wasn’t great.  Out of a class of 175 students, only 19 of us showed up – a figure that’s even less impressive considering that 3 of that group work at Cornell and live in Ithaca.  Yet, even though the vast majority of my classmates — at least 80 percent — went directly to large firms in big cities after graduation, five of the 19 that returned for the reunion started and run our own solo and small firm practices.

The statistics are even more interesting than that.  All five of us who have our own firms have been in business six years or longer; we all have at least one part-time staffer or associate, while two employ five or more attorneys.

Yet when the Dean spoke about the state of legal education and job prospects for grads, what do you think he focused on? The percentage of lawyers headed for large firms, followed by those bound for public interest. The Dean also noted that like many other law schools, Cornell funds eleven post-graduation public interest fellowships to mitigate the impacts of the current economy on new grads.

Don’t get me wrong – public interest work is important, but funding students to work for free doesn’t make much sense in the long run. The public interest positions occasionally lead to full time work (either funds free up so the organization can hire, or the contacts generate lead to jobs). But otherwise, it seemed to me that the funded positions merely delay inevitable unemployment to a year after graduation –beyond the time frame in which post-graduate employment statistics are ordinarily gathered.

The bottom line is that save for a bump in post-graduation employment stats, law schools draw very little ROI from the money they spend paying grads to work for free.  Likewise, I question whether the law school solo incubators that are popping up all over are doing much to create new jobs for law school grads. Incubator programs in theory, help new solos get practices off the ground.  But in reality, they merely subsidize solos so that they can take on the endless supply of low bono cases that come through the door rather than teaching them how to market, network and begin to attract high end work.

If law schools want to teach students to take charge and be entrepreneurial, then they need to think entrepreneurially themselves. When law schools fund projects, they ought to focus on those that will result in creation of jobs for new grads. What that means is that law schools ought to be investing in solo and small firms started by their alumni.

Investment can take several forms. On the most basic level, just as law schools fund public interest fellowships, they should fund internships and associateships at solo and small firms – either outright or on a matching basis (where the firm pays $15-$25/hour and the law school matches). The intern could either displace low-end research or cite-checking work to free up the principal attorney to market and expand the practice.  Or the intern could be tasked with substantive marketing projects such as researching and writing blog posts or articles that could help attract new clients.

Law schools could go a step further, though. They could identify firms with growth potential, and provide the kind of support that Ycombinator offers to its incubator clients (funding would have to be structured in a way to avoid the bar on outside investment – and it could be if fashioned as loan forgiveness or paying for services that would help reduce the firm’s costs).  In exchange, the funded firms would commit to hiring and training alumni.

Let’s face it: law schools aren’t exactly smart when it comes to spending money. While I do relish a good law review article, they shouldn’t  come with a $100,000 price tag when any fool, myself included can toss together a piece suitable for publication for a few hundred dollars to cover cite checking by a summer associate or contract lawyer. While I understand the importance of tenure to ensure academic freedom, does it make sense for law schools to offer employment for life in a dynamic era when the ability to pivot and stay nimble is far more important than stability and worse, stodginess?  I

Ultimately, a law school’s sustainability depends not on its academic achievements but rather, upon the success of its alumni – both those who are eventually able to make large donations but also those able to hire and train law school graduates.  Law schools that want alumni to give back then, ought to pay it forward by investing in solos and smalls – the engine of growth in the legal profession – and the ones who are loyal to their law schools, if my experience at my reunion is any indication.

  • James Liwski

    Great article… I couldn’t agree more!

  • qning

    “Why Don’t Law Schools Invest In Law Firm Start Ups?”

    Because there are too many law firms already?

  • teo123

    Good points. Law schools seem too “academic” to spend the time to understand the for-profit side of the profession. And, sorry, pushing 25 year old kids to the big firms that churn kids out each year doesn’t make a lot of sense. getting them to think both like a lawyer and business person makes a lot of sense.

  • disambiguation

    Carolyn, I’m curious whether in terms of investment, you would envision something similar to the UK’s two-year training contract for young lawyers but with the inclusion of law school support? I can’t say I’m aware of how well that program actually works at churning out attorneys prepared to practice law, but it could be an interesting concept.

    As for creating a YCombinator like incubator for attorneys, it sounds incredibly compelling to me, but I’m not sure whether law schools are in the best position to actually teach graduates to be attorneys. As teo123 mentioned, the law schools have focused on “academics” rather than the practice of law. Partnering with successfully practicing lawyers might alleviate this however.

    Ultimately, I agree that law schools should be doing more to actively promote their graduates career prospects, something which woefully few law schools actually do.

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