MyShingle : Solo and Small Law Firm Management and Marketing

If you've not seen this great letter,  How to Succeed as A Lawyer (Roland Boyd), that was first published more than 40 years ago in the Texas Bar Journal, then put down what you're doing and read it now.  On the surface, the letter simply dispenses tips from a father to a son on how to succeed as a a lawyer, but the subtext gives us a look at a forty year legal career rich with integrity, satisfaction and optimism.  For example, Boyd writes:

The only limit on the amount of success you can achieve [in law] is your time and energy. And the thought that will give strength to finish when the hour gets late and going gets rough, is that irrespective of how it might look to others, you know you are fighting according to the accepted rules of the game.

These days, our profession spends so much time discussing the business of law, making money and managing (the clients, the paperwork and everything else).  I cover those issues at MyShingle as much as anywhere because they're basic survival skills without which solo and small firm lawyers can't function.  But when we focus all the time on the business of law, we lose sight of the higher purpose we can serve as lawyers, the changes we can make and the people we can help.  If you read Boyd's letter, you'll be reminded of what brought you to law to begin with and why despite the stresses and the problems, you still want to stay.

• Print
• Comments (2)
• Trackbacks

At least one small firm lawyer isn't very impressed by the recent news that first year associate salaries at some firms will increase to $135,000.  In a listserve post, attorney Robert Hughes noted that:

Let's see.  $135,000 per year equals $2600 per week divided by about 90 hours per week equals $28.85 per hour.  What a deal.  I pay contract lawyers this much.  I rate in the top 1% of law firms nationwide in my payrates.  Hooray!

So if you've turned up your nose at small firm practice because you thought it couldn't match a large firm salary, you may want to think again.  $135k a year is plenty of money (which you might really need if you have family or loans).   But how long is that kind of pay worth it to you?

• Print
• Comments (7)
• Trackbacks (1)

Below, a reader writes in with advice on some frequently asked questions related to solo practice.  The reader's questions and our answers are interspersed below.  Readers, since I've only started one practice, after all, I'm the first to admit that I'm not an authority on all ways to go solo.  What I've learned from blogging here and meeting other solos is that there are as many routes to success as there are shinglers.  So please write in and send comments that reflect your own unique experience. 

(1) My spouse and I have set one year as our goal to start the firm - we want to save at least six months of expenses before we take the leap.  Is that realistic or do you think it will take more time to get up and running?  How much capital do you think one needs to get started?

Though I've seen other numbers, saving to cover six months of expenses seems reasonable.  Sure, you could wait until you've got a year's worth of expenses covered, but as I advised this reader, there's always a tradeoff between waiting and getting started.  You don't want to start out on the wrong foot with insufficient savings but at the same time, you don't want to put a firm on hold permanently as you save and build up clients. 

In terms of capital, it's relatively easy to start a small firm on a shoestring these days.  I'm guessing that you and your wife have at least one home computer that's powerful enough to be transformed into a work machine.  And with computer prices falling, you can even purchase a decent laptop as a second office machine for $1000 or less.  You'll also need to pay malpractice, the cost of which will depend upon your jurisidiction, state and practice area, but can probably be located for $200/month or less starting out.   Other expenses would include business cards, stationary, phone service (here, you can use a cell phone if you already have one),  and  potentially office payments (see response to  Q. 4)  And then there's health insurance if you and your spouse will both be self-employed.

One suggestion I'd make given that both you and your spouse are considering a firm is that you stagger your start up.  For example, if you are both employed, you could leave your position and hang the shingle, while your spouse would continue to work for another six months to a year.  You'd have the benefit of insurance coverage, plus your spouse's earnings could go into the firm.  Perhaps, thereafter your spouse could leave or cut down to part time.  This would give you both the ability to get your practice started with some set revenues still coming in the door.  Then, you could work to wean yourselves off your spouse's salary to full dependence on law firm income.      

• Print
• Comments (4)
• Trackbacks (1)

This article, Allee Offers Business Experience, Acumen, Mary Beth Smetzer, reports on a Fairbanks, AK solo Rita Allee who's running for City Council and touting her skills as a solo as the characteristics that qualify her for office.  Says Allee:

"I feel practically my whole life's experience, education, business experience and background in Fairbanks makes me real suited to serve in this capacity," Allee said. "I think I can be a help and have considerable business acumen having run my own business since 1978 with tight budget constraints. You have to say 'no' more than you can say 'yes,' regrettably when it comes to financial issues."

Business experience and the ability to operate within a budget may seem common place to most of us solos, but they're rare qualities in government.  Maybe more solos should run for office!

• Print
• Comments
• Trackbacks (2)

While you may never find an ideal time to start a firm, hopefully, you'll realize when it's time to stop.  The attorney described in this article, Attorney Loses License Again, Kevin Eigelbach (9/21/05) apparently didn't so now the bar's stopped his practice for him.  Attorney Gabbard of Kentucky has been suspended from practice for 21 months for neglecting two cases.   Gabbard, who'd never had a complaint before and  even  won a  pro bono award, claimed that  his wife's illness  prevented him  from  carrying  out his obligations which probably was a consideration.  But given the amounts paid in these cases - $950 in one and $450 in the other, I'm wondering whether after 2 decades of practice, Gabbard just couldn't get himself motivated for the amount of money involved.  That doesn't excuse his conduct of course, since for his clients, those amounts may have been substantial.  But for me, the lesson is that if you can't get yourself going to handle smaller matters, then don't take them to begin with or farm them out and take a break.  Better than a forced respite from practice.

Update:  See Lisa Solomon's comments on this story below, pointing out the impact that illness can have on a solo practice and more importantly, the need to get assistance when that happens.

• Print
• Comments (1)
• Trackbacks

As a follow up to this earlier  post, it's been three weeks since Katrina and solo and small firm practitioners are starting to contemplate the consequences and plan for the future.  This article,  Many Small Law Firms May be Gone, Adrian Angelette, reports on small firms' biggest problem - loss of clients.  From the article:

The task of restarting a law practice will be particularly daunting for one-lawyer offices or small firms whose clientele was made up largely of New Orleanians who evacuated. Many lawyers will also have to cope with files and equipment destroyed by wind or water.  "A lot of lawyers lost their clients. I'm afraid many solo practitioners and small firms will be forced to leave the state," Baton Rouge Bar Association President Greg Bodin said. "There are probably a number of small firms that � have already moved once. How can they afford to move again?"

• Print
• Comments
• Trackbacks

Editor's Note:  Recently, I've been receiving a number of inquiries seeking advice on starting a practice.  I'm going to try to address as many as I can, as quickly as I can, in what will hopefully be a regular "Questions & Advice" column.  If you send me an email with a question, try to eliminate any identifying information so that I can use it in a column.  I'll get in touch with you prior to posting, but it will make my job easier if I don't have to reformulate questions.  With that, my first question topic is how to handle the naysayers, particularly when you're a relatively new attorney.

Reader Question:  I am not happy with my current position and for three months have been working on this idea of starting my own firm.   I feel confident in my abilities to competently represent clients in my practice area, even though I've only been practicing for just over one year (it's a field where I have personal experience and which I worked in during two summer law clerkships). 

My plan is to begin in a home office, use web-based case management software, and digital phone - all of which will make it easier to move when I (hopefully) can afford a "real" office.  I am single so I do have think about things like paying for my own health insurance, meeting my rent, paying my student loans, and putting food on the table.

I was quite confident in my ability to do all this by the end of this calendar year.  But a colleague who started her own practice as the same age as I am advised me against it,  saying that it's harder than anyone can imagine to get clients and to manage your own practice.

Now, I'm scared.  Even though I do not doubt my legal abilities and even though I know I can and am willing to work for hours each week and I get so excited just thinking about my own practice, I'm back tracking from the idea.  I know that success can't be guaranteed, but now I wonder whether I should wait until I have more money saved up or I have my own client base I can take with me to a new practice before I go solo.

• Print
• Comments (4)
• Trackbacks (1)

I was interviewed last week by a writer from Law Crossing and surprised to see the article appear so quickly in the Law Stars Hall of Fame.   Another benefit of blogging, that's for sure.

• Print
• Comments (1)
• Trackbacks

The Harvard Law School newspaper put out a career guide which included all kinds of articles like Why Not to Be A Government Lawyer (as a former FERC attorney, I've got to agree with that one), the downside of biglaw and careers in public interest.  Sorely missing from the list of possibilities is the one that's My Shingle's raison d'etre:  starting your own practice.  Maybe to figure that one out, you need to have graduated from another Boston area school like Alice of a Mad Tea Party who's just revealed her identity as a recent BU law grad who's gone solo.  (hat tip to Denise Howell for the link). 

• Print
• Comments (3)
• Trackbacks (1)

This article, Is Mandatory Disclosure of Malpractice Coverage a Good Idea?  Ann Sherman, Small Firm Business (9/19/05) writes about the debate over mandatory malpractice disclosure rules taking place before many state bars across the country.  Below from the article is an excellent summary of the pros and cons of mandatory disclosure from Bob Weldon of the Washington State Bar Association and Lee Sexton, a criminal defense attorney.

• Print
• Comments (1)
• Trackbacks (1)

This article, Winning As Your Own Lawyer, NY Lawyer (9/15/05) reports on one of the unusual instances where a lawyer represented himself before a disciplinary board - and won!  From the article:

In 2002, Ziegler took over the defense of a robbery charge against a member of a family he had represented for years, even though he didn't do much criminal law. But when Ziegler failed to negotiate the noncustodial sentence he thought the client deserved, and the client couldn't pay for a trial, he sought to hand the case back to the public defender's office.

Union County Superior Court Judge James Heimlich ordered Ziegler to try the case and wouldn't grant a postponement. When Ziegler said no, the judge held him in contempt and the District VB Ethics Committee said he violated RPC 1.16(c), failing to continue representation when ordered to do so by a tribunal.

• Print
• Comments
• Trackbacks

And yet another biglaw attorney downsizes, as reported in this article, Law Firm to Serve Smaller Businesses  (Grand Rapids Press, 9/10/05).  According to the piece, Barry Kane, a large firm partner and Vince DeYoung, former attorney for Kentucky Fried Chicken and Harrahs' have  launched a Michigan law firm that specializes in business counseling, intellectual property law and franchise law.  One of the firm's goals is to keep rates affordable for smaller business clients.  Here's Kane's description of his firm's business model and why he believes it will work:   

"By reducing your overhead . . . you can reduce your hourly rate and still be a viable business. It's pretty straightforward problem-solving to me," said Kane, a former shareholder at Miller, Johnson, Snell and Cummiskey.  And the firm's small size enables quick response to changes in the marketplace, Kane said. What stays the same, regardless of office size, is the quality of legal work, De Young said.  The practice charges $225 per hour for basic business counseling, a rate above industry norms but more than one-third less than what Kane said he has charged in the past at larger firms.

So even as law firms merge and go global, threatening to fold into four or five ginormous entities, stories like this one remind me that it's still a small [firm] world after all.

• Print
• Comments (1)
• Trackbacks

For all of you home office shinglers, fellow solo Lisa Solomon authored this guest post at Home Office Lawyer entitled "Putting the Office Back in the Home Office."  Lisa offers a couple of quick tips to professionalize your home office so that you can keep your home-office and home-life separate from each other.

• Print
• Comments
• Trackbacks (1)

So, the American Bar Association says that it wants us solo and small firm lawyers to consider joining?  If that's so, it's going to have to do a far better job of understanding the abilities and needs of solo and small firm attorneys than it has.

Consider this article, Solos Lead the Wireless Way, ABA Journal (September 2005).  To the shock and surprise of the ABA, solos (gasp!) have lead the way in implementing wireless networks while midsized firms have lagged.  Imagine - solos being in the forefront of technology!  What's even worse is this quote from an ABA official, trying to explain this trend

The result was one of the most dramatic trends found in this year's survey. "I was surprised how many solos adopted wireless in the office or use it to get onto the Internet away from work," says Catherine Sanders Reach, associate director of the ABA's Legal Technology Resource Center. "Solos typically run behind large law firms and use bare-bones technology. Maybe wireless provides a bare-bones service solos need."

• Print
• Comments (1)
• Trackbacks (20)

Associate:  Can I take a look at the certificate of incorporation for my research assignment?
Partner:   No! You don't really need to know the facts.  Just do the research I asked for!

I'm just guessing about the partner-associate partnerese dialogue that might have ensued as part of the preparation of The Opinion Letter That Could Cost Andrews Kurth $90 Million (Mary Alice Robbins, Texas Lawyer, 9/7/05).  As the article describes, four stock purchasers have alleged that Andrews Kurth assured in, in an opinion letter, that a stock sale by a wireless service provider, complied with the corporation's governing documents when the corporate articles actually prohibited the sale.  The opinion letter had stated that the corporation had the authority to issue the stock and that it was properly issued.  But in the rush to research all kinds of theoretical legal issues, apparently, no one did the obvious, i.e., reviewed the corporate articles.  Or maybe, just maybe, an associate thought of it and suggested it but the partnerese-speaking partner didn't understand.

• Print
• Comments
• Trackbacks

Via Tom Mighell at Inter-alia comes a link to weblog that's been published since March 2005 but is new to me: Wayne Schiess' Legal Writing.  Wayne's site offers examples of poor legal drafting, tips on legal writing and a list of articles that he's written. 

What was most interesting to me though was that Wayne's photo looked awfully familiar - so when I took a look at his background, I learned that he was in the class behind me at Cornell Law School.

• Print
• Comments
• Trackbacks

Following up on this last post, there's another article, Small Law Firms Hit Hard by Katrin (Fulton County Daily Report - 9/8/05) on the impact of Katrina on small firms.  From the article:

"I'm worried about the ones that don't have friends. Some of the solos and real small outfits might not know other folks in other parts of the state," Neuner (Bar President) said.

Solo practitioners and even firms with 10 or 20 lawyers who've had their offices flooded can't send bills or get checks from clients, Neuner pointed out. "How do they pay employees?" he asked. Their client files and computers, in many cases, have been destroyed by floodwaters.

The bar is reaching out, with efforts to find housing and office space for displaced attorneys and has also started a fund to collect money to assist.  And on that topic, Kevin O'Keefe of LexBlog is offering to help firms set up at no cost a free weblog to facilitate communication with clients and employees.

• Print
• Comments (1)
• Trackbacks

I know that frequently I'm regarded as an avid advocate (some of my blogging buddies would even call me a cheerleader) for solo practice, focusing primarily on the benefits of going solo rather than the risks or drawbacks.  But in the wake of Katrina, I'm reminded of the somber side of solo practice:  how many of us solos operate at the edge, with little margin for error.

• Print
• Comments (2)
• Trackbacks (1)

Matt Homann of Non Billable Hour has run his cost benefit analysis and gives us his conclusions here:

Poor health and strained family relations are both "business expenses" I'm unwilling to pay.

Are you willing to pay that price?

• Print
• Comments
• Trackbacks

Here's a history making attorney:  Sam Slaymaker, who's Making Local History By Focusing on Preservation (Lancaster News, 9/3/05).  According to the article,

Sam Slaymaker becomes first local attorney to devote an entire practice to preservation law. He hopes to serve homeowners, farm families, real-estate developers and municipalities.

Slaymaker has the background for his niche - he's served as a board member of various prservation societies, holds an undergrad and graduate major in history and has been an attorney for 16 years.  Congrats to Slaymaker on his new firm and on finding a way to marry his business and his passion.

• Print
• Comments (1)
• Trackbacks

Not sure how I missed this earlier, but Bob Ambrogi of Legal Line Blog recently posted  here on ABA President Michael Greco's commitment to solo and small firm lawyers.  Greco writes in his piece :

"We have created a new portal for solo and small-firm lawyers to enter the ABA, and we have thrown open the doors to our more than two dozen substantive law sections, recognizing that these colleagues practice in many areas of the law and work on behalf of a diverse group of clients. Now constituted as a Division of the American Bar Association, this new entity will help guide its members into appropriate substantive law sections and provide practitioners the best resources and expertise that the ABA has to offer.

What does the ABA offer a solo or small-firm lawyer? Lots of things. Advice on building and managing their law practice. Access to a wealth of publications and electronic information to keep their skills sharp and knowledge up to date. The best CLE programs in the country. Opportunities to network with other lawyers and legal experts throughout the country. And a wide range of benefits, including health insurance, travel services and discounts.

I'm glad to see that the ABA at least acknowleging that it could be doing more for solos.  That said, the ABA could do much more if it would invite me or any of my fellow blogging colleagues to blog the upcoming Fall GP Solo Meeting.  But given that no one even blogged the ABA Annual Conference, I'm probably expecting too much.

• Print
• Comments
• Trackbacks

Matt Homann of the Non Billable Hour and LexThink just announced  BlawgThink to be held at Catalyst Ranch in Chicago, November 11-12, 2005.  According to Matt, there'll be "two days of blawgging how-to, small group discussions and collaborative brainstorming."  To get more information or an invite, contact Matt at matt@lexthink.com.  If BlawgThink is anything like the first LexThink that I attended back in April, you won't be disappointed....   

• Print
• Comments
• Trackbacks (2)

Ross Kodner's a legal technlogy consultant at Microlaw whose clients
include many small law firms and whose website and presentations have
offered resources and support to thousands of lawyers.   Now,
Ross is putting out a call to the legal and legal tech community
to help out those impacted in Katrina.  Here's the text of his message (in blue) and contact information:

I'm sure that all of you are experiencing something similar when watching

the horrible images unfold on the news in Louisiana and Mississippi. I'm

finding it hard to keep my composure watching and feeling pretty powerless

to do anything. Sure, we can all donate money to the Red Cross and any other

agency, but as in the aftermath of 9/11 four years ago, I do think those of

us in the legal technology, bar association and the legal tech media world

may be able to offer more practical assistance. 

• Print
• Comments
• Trackbacks