Small Firms, Big Lawyers: The Key Question for Shingle-Hangers

Ed. note: This is the latest installment of Small Firms, Big Lawyers, one of Above the Law’s new columns for small-firm lawyers.

Many Above the Law readers are currently facing dismal job prospects as the law-firm economy continues to trail the national economy. Some are law students contemplating graduation without an offer in hand. Others are junior associates who fear the return of mass layoffs. Still others are recent graduates bouncing between contracting jobs and other stopgaps. And the solution that many of these readers are arriving at is to start their own firms. As someone who did that 13 years ago, I applaud the sentiment. But before you go shopping for shingles to hang, I have one — and only one — question for you:

Do you want to run a business, or do you want to practice law?

I’m not being facetious here; it’s a completely serious question. But I’m afraid it’s not a question that most budding shingle-hangers ask themselves. And the answer is crucial: your future happiness depends on it. Because unfortunately, many lawyers start their own shops for exactly the wrong reason, and they find themselves in the worst possible job they could imagine: working as an underpaid wage slave for a complete idiot of a boss. (Themselves.)

I give a lot of informational interviews to newer attorneys or to law students who (think they) are interested in starting their own practices. And I always ask them this question, and most of the time, they answer: “Both.”

And I think: Danger, Will Robinson. Because “Both” is the wrong answer.…

Sponsored

I’m not saying you can’t do both, because every lawyer who successfully launches a law firm is both running a business and practicing law. But the question isn’t “Can you …?” It’s “Do you want to …?” And what your motivation is for starting your own firm is critical to whether you’ll succeed.

If answering truthfully, most lawyers and law students will say “practice law.” And that’s fine. Some of my best friends are lawyers who practice law. But if that’s your answer, then what you need is a platform for practicing law. And your own law firm is a lousy platform for that. Almost any other platform is better: someone else’s firm, a company’s law department, the government, a public-service organization. These are all places where your focus will be on practicing law. Someone else runs the business.

Now, I hear the excuses. The firms and companies aren’t hiring, or they aren’t going to hire me. And the government and public-services places don’t pay very well, or don’t pay at all. I get that. But my advice is keep looking. Because you do not want to be working in your own firm.

When you start your own shop, you spend much more time, effort, and energy running the business than you do practicing law. Nothing wrong with that; it’s just the way it is. Ideally, you’ll spend more time working on your business than in your business.

The problem with people who primarily want to practice law is that they don’t want to “waste” their time doing the business part of the job. Sales, marketing, management, administration, operations, finance, accounts receivable, accounts payable, office supplies, making coffee, making copies. In time, as your firm grows, you may be able to hire other people to many of these things; maybe even all of them. But if your focus is on practicing law instead of running the business, then your firm isn’t that likely to grow.

Sponsored

By the way, this concept is spelled out more fully in an excellent book by Michael Gerber called The E-Myth Revisited. (The “E” is for “entrepreneur.”) I’ve read the book at least ten times, and I’ve given it out to people starting their own firms — or other companies — at least a dozen times. In the book, the aspiring entrepreneur is a pie maker. Lawyer, pie maker: same difference.

I knew long before I decided to go to law school that I wanted to run my own business; I just didn’t know what kind of business. Law school gave me that answer, and I became a lawyer so that I could eventually run my own business: a law firm. Now that I’ve been doing it for 13 years, I’m pretty much unemployable. If I stopped running my own law firm, I wouldn’t go practice on another platform, at a different firm. I’d start a new business not practicing law. (In fact, I just opened a separate, not-a-law-firm business called Prefix LLC, a consultancy that helps lawyers price their knowledge instead of billing their time. End of shameless plug.)

Don’t get me wrong: I love being a lawyer, and I’ve worked very hard at it. But my primary job is being an entrepreneur: a business owner who runs a law firm. My secondary job is practicing law (don’t tell my clients that). Fortunately, I do my secondary job pretty well — maybe even better than my primary job. But then again, my primary job is much harder.

If you want your primary job to be “lawyer,” please put down that hammer and step away from the shingle. You do not want to have your own firm, and you’ll be miserable. But if you consider yourself an entrepreneur first and a lawyer second (even a close second), then welcome to the ranks of the self-employed. You’ll probably never leave.


Jay Shepherd has run the Boston management-side employment-law boutique Shepherd Law Group for the past 13 years. Jay also founded Prefix, LLC, which helps lawyers and clients value and price legal services. He writes the ABA Blawg 100 honoree The Client Revolution, which focuses on reinventing the business of law, and Gruntled Employees, a workplace blog. Follow Jay on Twitter at @jayshep, or email him at js@shepherdlawgroup.com.