Oh, you’re all running here now. You saw the title. Here you come. Click click click. It’s all you want to know. And by you, I mean those who claim to love Biglaw, but would jump to your own place or a smaller firm in a second if you “could make the same money.”
I know when you call me, when you come to my office to discuss the “possibility of leaving,” that it’s the only thing on your mind. Sure, you want your name on the door, more freedom, more client contact. But you just have one real question. One real fear. One real concern. One thing you need to convince your better half of before you make “the jump.”
Can I make the same money?
Here’s the answer….
You can make the same money. You can make less money. You can make more money.
There’s no magic answer. No magic. Really. It’s all going to depend on your ability to make rain. Office-dwelling drones with bad suits need not apply.
Let’s play with some numbers.
You’re a couple years in at Biglaw. Salary is still a bit below $200K. You have the adjustable rate mortgage for the house you can’t afford, and two BMWs because you need to show the wife that you’ve “made it.” With your debt and need to maintain the lifestyle of a high-flying, glorified paralegal, you can’t leave unless you can make $200,000, so you think.
Question: Are you taking any clients with you? If so, what are the clients paying your firm, and what are they going to pay you? We’re not talking about you taking GE or Google in to your new small firm, so the question is, will Bob’s Bait and Tackle, with six locations, pay you enough to maintain the life?
For the rest of you — most of you — that won’t be taking any clients with you, understand a few things.
First, if you’re going to work for a small firm, you’re not going to make the same money right away unless you are a rainmaker and have an agreement with them that you get a piece of any business you bring to the firm. If you are a rainmaker and don’t negotiate this into your financial package, you are a moron. Small firms, even the ones that make a lot of money, aren’t stupid enough to pay young lawyers more than they’re worth. So unless you bring them dollars, you may have to get the wife a Camry and start eating at Applebee’s once a month.
Second, if you are striking out on your own, don’t work from home or a coffee shop. I don’t care what these “futurists” say. They’re just being cheap because they’re too scared to try and become real lawyers. Get an office. Even if it’s a part-time office. Get one. The best situation for you is going to be a small firm or a group of solos sharing space that have an office for you. Try to trade work for rent, but if that’s not possible, find something where all the extras are there — internet, copier, receptionist, et cetera. You should figure about $2,000 a month for this type of arrangement, and yes, I know real estate is more expensive in certain cities, but you’re looking for a decent office by the courthouse, or in the central business district, or somewhere convenient for your clients, not the 50th floor of the most expensive building in the city. You want nice clients, get a nice office. You want crappy clients, work around the baristas.
Third, the most important relationship you should immediately establish is with a bank. Get a line of credit (if you’re not a deadbeat). Occasionally ask to increase the line, even if you don’t need it. One day you might, or one day another bank may want your business, and the fact that you’ve had a line of credit will be important. You may not need $50,000 or $100,000 right now, but one day you may need $500,000 to finance a case.
Finally, understand that the question is not “can I make the same money,” it’s “what do I need to survive?” Anyone who starts a business (and that includes leaving Biglaw for a small firm) knows that for the most part, the first couple years you’re building something. So you’re going to need to prepare for the possibility of living within a new means. If that’s equivalent to suicide for you, well, then, good luck.
But most of the people I know that left Biglaw made as much or more their first year out.
Brian Tannebaum will never “get on board” at the advice of failed lawyers who were never a part of the past but claim to know “the future of law.” He represents clients, every day, in criminal and lawyer discipline cases without the assistance of an Apple device, and usually gets to work (in an office, not a coffee shop) by 9 a.m. No client has ever asked if he’s on Twitter. He can be reached at email@example.com.