Soon after I started my solo practice, I realized that I needed to develop and execute a plan for getting new clients. At first, I did it the old-fashioned way: networking, joining organizations, giving elevator speeches, passing out business cards, and doing contract work for other attorneys. This method took time and cost money and it didn’t work to the extent I had hoped. So I asked a few colleagues whether I should hire someone to help me improve my business.
I received the names of consultants, SEO experts, and coaches. Someone even suggested I talk to Tony Robbins. Some people swore by them while others said that the “advice” they provided was a bunch of hooey and can be found on the internet or at the library for free.
Over the last few years, I have become very skeptical of business development professionals (sometimes known as “marketeers”) who claim that they know the “secret technique” for improving my solo practice. A number of them are lawyers or ex-lawyers who — for one reason or another — decided to go into consulting and coaching. Also, some of these “experts” have questionable backgrounds and may not understand the professional rules that we lawyers have to follow.
I should point out that the purpose of this post is not to badmouth any particular person or the legal business development industry. This guy covered that already. But click onwards to find out the reasons for my skepticism and my thoughts on when it might make sense to retain a business development professional….
Of all the regrets I have in life, one of my greatest is that I never had the chance to meet Peter Drucker before he died.
Drucker is one of my intellectual heroes. He was able to look at the same world that everyone else was looking at but see things that others couldn’t see. He literally invented a science. And like all science, it is around you from the start but you just can’t see it till someone shows you the way.
The science he invented was the science of “management.” Before Drucker, people just ran things and sometimes good things happened and sometimes bad things — no one really delved too deeply into the “why” of it all. But then along came Drucker, who made order out of chaos and realized that there were principles that, if followed, would increase the likelihood a business would be successful.
All those leadership books you sometimes read, all those “how to” books you sometimes read, all of that thinking evolved from his groundbreaking analysis into the science of “management.” Drucker’s books are utter masterpieces. Indeed, there was an epiphany for me on every single page of his amazing book Management (affiliate link). I think I learned more about how to run my law firm successfully from Drucker than from any other source.
Here are two thoughts from Drucker that hit me like a bolt of lightning when I read them. Honestly, my business — and even my whole life — was never the same again.
“A few years ago, a lawyer I know had to leave her hometown where she had lived most of her life and move cross country for family reasons. And because she loved her solo practice and the flexibility it afforded her as a mother, and since she is smart and confident, she decided to re-start her solo practice in the new city, thinking it would not be too difficult. But it proved to be much more challenging than she ever thought.”
“Back here, in her hometown where she knew everyone, clients were not hard to come by. In the new city however, she had a lot fewer contacts and even fewer potential clients. And given that back here she had not really had to work too hard to get business, she never really learned about marketing, so that too was new. Eventually, between the Not-So-Great Recession and the challenges of starting from scratch, she finally had to go to work for someone else.”
The article got me thinking: How much of an edge does a lawyer’s hometown — or college or law school town, for that matter — provide in starting a successful solo practice?
Occasionally, someone wants me to do legal work outside of my practice area. I tend to refer the potential client to an attorney who can handle it and ask for a referral fee when appropriate. But sometimes it makes sense to work the case myself with outside help — for example, if the work is for an existing client and he cannot afford the referring attorney’s fee. So as a gesture of appreciation to the client, you want to help him for a reduced fee. Or you want to get experience in the area of law that is involved.
And let’s be anonymously honest. Sometimes the case has potential for large attorney’s fees and you want a bigger cut than the firm’s standard referral percentage. It’s hard not to feel bitter when you get a paltry referral fee up front and later learn that the attorney who handled the matter got a half-million-dollar payout.
So today, I want to write about how I typically (but not always) decide whether to refer a case out completely, or co-counsel with someone else. I assume readers are familiar with and will follow the ABA Model Rules 7.2 and 1.5(e) and your state’s versions of these rules. My first priority is to refer a client to a competent attorney, even if it means a smaller referral fee or none at all. But when there are three or more equally competent and business-savvy attorneys competing for your referrals, the size and girth of the compensation package can be appealing…
Yet in spite of my love affair blogging, these days, I no longer believe as ardently as I once did that solo and small firm lawyers should take up blogging to market their practice or to show what they know to prospective clients. Sure, there are exceptions. For lawyers who’ve already taken up blogging in law school or who have a unique viewpoint about practice area that they yearn to share, starting a blog is a no-brainer. Likewise, blogging makes sense if writing about the challenges of practicing law or handling particular types of cases offers a pleasurable release from the stress. If mind and computer keyboard operate as a seamless unit, with thoughts effortlessly transforming into cogent and compelling prose, then blogging makes sense as well.
But let’s face it: most lawyers aren’t built that way….
There are plenty of good reasons why a solo lawyer should, and indeed must, refer a case to another firm. For example, if a particular case isn’t compatible with your business – either because it falls outside of your firm’s practice area or it’s not economical for your firm to handle – there’s no reason to hang on to it. And notwithstanding the advance conflict waivers that large firms foist on clients, in my view, conflicts of interest are a non-negotiable grounds for referral, because they “spawn an alarming number of ethics complaints.”
But there are other situations where a solo shouldn’t be so quick to send a case packing, notwithstanding conventional wisdom to the contrary. Here’s a list of examples where you might want to think twice before referring a case:
It’s one thing to say that you bill at $200 or $500 or $1,000 an hour; it’s another to actually collect those fees. Every time a client fails to pay a bill, you’re effectively discounting your overall rate. And while writing off $500 here or there may not seem like much, over the course of the year it can amount to several thousand dollars – which doesn’t take into account the added cost of chasing down clients to collect from them.
Of course, the best way to avoid getting stiffed is to obey Foonberg’s Rule: Get the money up front. Unfortunately, sometimes, you can’t predict the full cost upfront – and if the expected bill is mid-five figures or more, a client simply may not have that kind of money all in one place. Moreover, taking payment up front won’t guard against a client asking for a refund down the line if you haven’t vetted the client properly. So beyond upfront payment, here’s a list of tips to avoid getting stiffed:
A few months back at my home blog, MyShingle, I wrote about a small Michigan law firm that sued a legal marketing company for fraud and RICO violations, alleging that the company created a “bogus Internet marketing program, supposedly designed for small law firms and sole practitioners” and duped firms into participating in the program through a series of misrepresentations about the company’s ability to boost law firms’ Google rankings. The lawsuit is still pending in federal district court in Arizona (Docket No. 2:13-cv-01502).
Though few expressed sympathy for the firm, suggesting that it was greedy or foolish to fall for the marketing company’s “infomercial-like” sales pitch, in my view the lawsuit raised a valid question: Should law firm marketers, practice management advisers, and other vendors pitching services to improve law firm performance remain accountable, at least to some degree, for the results?
Ed. note: This is the latest installment in a series from Bruce MacEwen and Janet Stanton of Adam Smith Esq. and JDMatch. “Across the Desk” takes a thoughtful look at recruiting, career paths, professional development, human capital, and related issues. Some of these pieces have previously appeared, in slightly different form, on AdamSmithEsq.com.
We continue our taxonomy of law firms with a term I’ve borrowed shamelessly from the retail industry, “Category Killers.” In retail, these have traditionally been Big Box stores with exhaustive inventory and wickedly competitive prices on one deep “vertical” category of merchandise:
Home Depot and Lowe’s
Toys ‘R Us, Linens ‘R Us, Attorneys ‘R Us
Bed Bath & Beyond and The Container Store
Petco and Petland
Staples and Office Depot
You get the idea. The most salient characteristic of this model is that it works. If you doubt me, then I have to ask if you disbelieve the famous phrase, “imitation is the sincerest form of flattery,” because the concept of category killer retail stores has spread far and wide from its initial roots.
As I use it in Law Land, it means a firm that has the following characteristics…
My friend Pablo told me that when Monica, a partner, called his home at 9:00 p.m., he knew it couldn’t be good. Why not email? For an instant, he considered letting the call go to voicemail. Taking a deep breath, he answered.
Monica wanted to know “where he was” with the brief Pablo had been working on. She had not given him any particular deadline, so he explained that he expected to circulate the draft for review the following evening. The brief was a motion to dismiss, and he knew the deadline to file was still two weeks away. He was allowing the partner one week to review before she had to send to the client, who in turn would have another week to review.
The partner, however, had a different idea. “I want it on my desk tomorrow by 8 a.m.,” she told Pablo.” “Not a moment later.”
If you are considering a virtual law practice, you know that many of today’s solo firms started that way. But why are established, multi-attorney law firms going virtual?
Many small firms are successfully moving part—or even all—of their practice to a virtual setting. This even includes multi-jurisdictional practice spanning several states and practice areas, although solo and small partnerships are still the largest adopters of virtual law.
Can you do the same? The new article Mobile in Practice, Virtual by Design from author Jared Correia, Esq., explores how mobile technology bring real-life benefits to a small law firm. Read this new article—the next in Thomson Reuters’ Independent Thinking series for small firms—to explore how a mobile practice:
Reduces malpractice risk
Enables you to gather the best attorneys to fit the firm, regardless of each person’s geographic location
Leverages mobile devices and cloud technology to enable on-the-spot client and prospect communication
Transitioning in-house is something many (if not most) firm lawyers find themselves considering at some point. For many, it’s the first step in their career that isn’t simply a function of picking the best option available based on a ranking system.
Unknown territory feels high-risk, and can have the effect of steering many of us towards the well-greased channels into large, established companies.
For those who may be open to something more entrepreneurial, there is far less information available. No recruiter is calling every week with offers and details.
In sponsorship with Betterment, ATL and David Lat will moderate a panel about life in-house and we’ll hear from GCs at Birchbox, Gawker Media, Squarespace, Bonobos, and Betterment. Drinks, snacks, networking, and a great time guaranteed. Invite your colleagues, but RSVP fast, as space is limited.
Ed. note: The Asia Chronicles column is authored by Kinney Recruiting. Kinney has made more placements of U.S. associates, counsels and partners in Asia than any other recruiting firm in each of the past seven years. You can reach them by email: firstname.lastname@example.org.
It’s that time of year again when JDs are starting to apply for 2L summer jobs and 2L summers are deciding which practice area to focus on.
For those JDs with an interest in potentially lateraling to or transferring to Asia in the future, please feel free to reach out to Kinney for advice on firm choices, interviewing and practice choices, relating to future marketability in Asia, or for a general discussion on your particular Asia markets of interest. This is of course a free of cost service for those who some years in the future may be our future industry contacts or perhaps even clients.
For some years now Kinney’s Asia head, Evan Jowers, has been formally advising Harvard Law students with such questions, as the Asia expert in Harvard Law’s “Ask The Experts Market Program” each summer and fall, with podcasts and scheduled phone calls. This has been an enjoyable and productive experience for all involved.