Lean. It’s mainstream business concept that’s seeped into the legal community.
“Start-up success is not a consequence of good genes or being in the right place at the right time,” according to Eric Ries, who penned the best-selling book The Lean Startup. “Success can be engineered by following the right process, which means it can be learned, which means it can be taught.”
If it can be learned and taught then there’s perhaps no better source for attorneys thinking about opening up a practice – than the advice of attorneys who already have. Here’s a roundup of 10 timeless tips for lawyers pondering a law firm startup.
1. Best time to start a law firm
The best time is maybe – “maybe last year, maybe never. But the second best time is now,” writes Carolyn Elefant with credit to business legend Seth Godin. She has a long list of posts neatly organized as a guide for starting a law firm on her blog MyShingle.
2. Planning not procrastination
Almost certainly some level of planning is required to launch a firm, but the time frame should be finite, according to John Skiba writing on his blog JDBlogger. “I have found that some lawyers get caught up in the preparation stage so long that they never launch. Get what you need to start your practice: a website, a computer, a printer, a scanner, and practice management software, and get going.
3. Ignore naysayers
In a challenging economy and with a contingency fee model, Branigan Robertson started his firm right out of law school. Writing a series of tips for the Business Insider he says, “98% of your law school classmates, lawyers, and professors honestly believe you can’t. Ignore them. Many attorneys are pessimists by nature and love to tell people what they can’t do. They never tried it so they don’t know. If you believe them, there is zero chance you’ll succeed. I’ve done it, and I know you can do it, too.”
4. Choose a practice area
“Focusing on a specific practice area allows potential clients and other attorneys to remember you as the go-to person for a particular legal problem,” write Tudor F. Capusan and Matthew Taub in article (PDF) with tips for starting a small law firm for the New York Bar Association. Attorneys with practice area focus gain “depth of knowledge” and are able to solve problems faster, more efficiently and therefore provide competitive pricing.
5. Law firm startup costs
“It depends” seems to be consensus answer among a round-up by Attorney at Work with six different answers to the question: How Much Does It Cost to Start a New Solo Law Firm? However, there were a few answers that got a little more specific. “Cloud options make starting a law firm less expensive than ever,” according to Debbie Foster of Affinity Consulting, a LexisNexis certified partner. “Presuming you establish your new practice from home, start-up costs can be as little as $3,500 inclusive of purchasing a laptop, printer and scanner. Cloud-based practice management and billing solutions run about $50 per user per month. Microsoft, via its Office 365 product, provides Microsoft Office 2010 for as little as $22 per month. Further, if you already own reasonably current computer equipment, start-up costs may be even less.”
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6. Consider the business structure
“Today, you have a number of choices when it comes to how you structure your law firm,” according to Jocelyn Frazer and Nerino Petro in a guide published by the ABA’s GPSolo. From an LLC to a PA, the authors say the decision boils down to two key factors: “(1) what is the best structure to shield yourself from personal liability (not including malpractice) and (2) which structure best addresses the foreseeable tax consequences of your practice?”
7. Develop personal technology skills
With wording reminiscent of Yoda’s quip, “Do or do not. There is no try”, law firm practice management Jedi Jim Calloway says “a brand new solo, particularly a young lawyer who intends to practice for many years into the future, must develop personal technology skills and pay attention to the powerful trends impacting the legal professional that are fueled by technology. Invest in your law firm technology processes for returns in the future.” His article was published by the Oklahoma Bar Association, but it’s worth pointing out “The Force” is strong on his personal blog too. It often ranks highly among credible news sources for attorneys in ABA surveys.
8. Wary be the eye on expenses
“Even if you do acquire sufficient clients at the outset, count on it being at least six months before you begin to have a regular income coming in,” according to Peter Elikann penning a tips list for the Mass Bar. He emphasizes keeping overhead costs down until cash flow catches up with a new firm. “Contingency fees, hourly billing and pay for contract work such as court-appointed bar advocates on criminal cases may not see actual checks in the mail at the outset.” He breaks out benefits and drawbacks to home offices, virtual law offices and executive suites.
9. Hone those listening skills
If hindsight is always 20/20 then listening skills might be better than talking skills to improve that vision. Paul Wallin walks readers through things he wish he had known before starting a law firm for the Law Insider. “It is much more important to be a good listener than a good talker,” he writes. “The bottom line is when a potential client comes to you for legal help you should do only two things: a) Listen to his or her legal problem, and allow him or her tell you the entire story without interruptions; and b) Attempt to answer his or her legal problem in clear, understandable language. Make certain you ask many times if he or she has any questions about all of his or her legal options.”
10. Getting your first client
“Most of us don’t realize that having a successful law practice and being a good lawyer are two completely different things,” writes Sona A. Tatiyants in a contributed post for She Negotiates, a series by Forbes. With $10,000 borrowed from savings and a healthy dose of fear, she attributes her first to clients to two activities: 1) collected business cards prior to opening a business and entering the information into a database; and 2) invested in stationary and sending a note announcing she was open for business. “I told the world that I was open for business and ready to take on clients. I got my first two clients from this single activity. One was a friend’s husband. The second was my mother’s friend (to this day my mom doesn’t know that I did her friend’s estate plan). Remember, you’re not soliciting business, but merely announcing that you’re open for business. Don’t forget to include the name of your law firm, location, type of clients you represent, and some business cards.”
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If you’re looking to start a law firm, or your looking to grow a law firm, don’t forget to check out this webinar: The Happy Lawyer’s Guide to Running Your Law Firm Like a Business.
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