Chances are, if you decided to get into shape you wouldn’t tell anyone right away. After a few weeks of running, dieting and lifting weights, when you start to see some results and people noticed, you would let the cat out of the bag. It feels sort of foolish to talk about it until you have taken some action.
Making a career change is the same way. This creates a conundrum: how do you get started if you don’t want to talk to anyone about it until you’ve done something? Forget the “starting a law firm” websites – you probably already know that you need a telephone and letterhead. So what is the first step?
The best place to start is to define your niche. This includes determining the services you will offer, the types of clients you will seek, your pricing strategy, your staffing and recruitment approach and your management structure. These will often change from your current platform. Focus on how you will be different from the competition. For those leaving Biglaw, a “vertical niche” strategy is often the way to go.
The next step is to put together a detailed financial forecast. This allows you to project the profitability and income you can expect to generate. It’s not much more complicated than estimating your revenue and then subtracting all of the expenses you anticipate. You can increase the precision of your revenue forecast by breaking it into small pieces. Try to project revenue by client, or by matter, or by task. On the expense lines, be sure to research and re-research costs to make sure that you haven’t overlooked anything. Then add some cushion, because you are bound to forget something.
The last thing to consider is whether you want a partner or not. A successful practice requires business development, professional development, business management and a leader who will motivate the team. If you are all of these things, then you can slap your name on the door and be done. If not, consider the types of partners you need to attract, how you will recruit them and where you are comfortable ceding control. Many firms go under because partners cannot get along, and many more fold because they are missing these ingredients needed for a successful practice.
Now you are ready to go public with your plans to start a firm. As you approach potential clients, partners and employees, focus on the differentiators and invite them into the thought process. The more people who take emotional ownership of your idea, the more likely it is to succeed.