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50 startup tips to get your practice off the ground

By Victor Li

April 1, 2021, 12:05 am CDT

For many, being your own boss is the ultimate dream. But the idea of hanging up your own shingle can be scary and confusing, while others might not know where to start.

The ABA Journal asked lawyers, legal professionals, marketers, consultants and other experts what to keep in mind when starting your own practice. Here are 50 tips. (Responses have been edited for clarity and space.)

Should you do it?

1. Do you believe you have a high risk tolerance? Do you enjoy the business aspects of running a practice beyond practicing law (i.e., leadership, management, finances, operations, sales/marketing)? Do you have a business plan? Do you have enough cash and bandwidth? If you answer yes to all of these questions, then maybe you should start your own practice. —Gyi Tsakalakis, president and co-founder of AttorneySync

2. Start by getting really clear with yourself on the purpose and goals for opening your own firm. While many lawyers are attracted to the possible freedom and flexibility of owning their own firm, lots of new firm owners haven’t planned out how much they’ll need to work “on” their business (strategy, business development, goal setting, documentation)versus how much they’ll be working “in” their business (providing legal services, sending out bills, reconciling accounts, marketing). —Aaron Street, CEO and co-founder, Lawyerist

3. If it’s nagging at you and you’re itching to do it, absolutely yes. I think most people who get to the point of seriously contemplating it are in a good position to try it. Most who really don’t want to or will hate it simply never get to the point of it being a serious possibility. —Megan Zavieh, Zavieh Law

4. Take an aptitude test: Myers-Briggs, StrengthsFinder [renamed CliftonStrengths], etc. That way, you know more about how you’re wired, which relates to your professional calling. If you are someone who likes to follow the structure provided to you by others, chances are you will hate running your firm. But if you (like me!) like creating your own rhythms and structures, chances are you will like the ups and downs of owning a business. —Inti Martínez-Alemán, Ceiba Fôrte Law Firm

5. Starting your own firm takes one-half planning and one-half insanity. You will need to be creative and hungry and prepared to make mistakes. Most of that time you are making snap decisions without a safety net, but you feel alive with every decision. Your world will shift from dialogue to numbers. Your language in law is prose, but your language in business will be numbers. Spend time educating yourself on that, even at the expense of less time on the law. —Brian King, King Law

6. Others will disagree. But in my opinion, if you have the opportunity to work for another lawyer or law firm before launching your own practice, take it. It can be a truly outstanding educational opportunity that allows one to learn while drawing a paycheck. —Jim Calloway, director, management assistance program, Oklahoma Bar Association

7. I was working for a firm where my talents were not appreciated. There were cases I wanted to take that the firm did not. I also had to wait for approval to move forward on things, and my income did not equal my production. —Daniel J. Tann, Law Offices of Daniel J. Tann

How do you develop a business plan

8. Your business plan should start with your vision. Are you creating an enterprise or a lifestyle business? Knowing this in advance will influence your plan, and your plan should be completely dependent on your goals. —Billie Tarascio, Modern Law

9. Do it, but don’t overthink it. It can be paralyzing to embark on a plan that we aren’t trained to write, but it’s not half as hard as you think it’ll be. Plus, it’s a living document. You can always pivot and change course. —Megan Zavieh

10. Planning is key. It may sound like a no-brainer, but use the internet to your advantage. It’s a great resource for educating yourself on any topic. Once you feel you have a handle on business objectives and goals, begin developing your plan. Look into what area of focus you want to specialize in, speak with those professional mentors on the do’s and don’ts of practicing. Most important: Seek feedback at every step of the way from peers, colleagues, etc., to make sure you are on the right track. —Jack Newton, CEO and co-founder, Clio

11. The old adage that you “can’t manage what isn’t measured” is more important than ever in today’s legal economy. Business plans must include a way to objectively measure outcomes. Business plans without metrics built in cannot succeed because there is no way to measure success. Failure is even scarier because without metrics to tell you when to stop or change directions, you can get in very deep before you even see the failure. —Patrick Palace, Palace Law

12. What are your revenue goals? Here’s one way to look at it: A 365-day year has 104 weekend days. Subtracting holidays, sick days, vacation days and family events leaves 220 working weekdays during the year. To gross $1 million per year, one would then need to average over $4,500 in revenue per day; while to gross $100,000, the average is over $450 per day. Gross is reduced by overhead and taxes before it ends up in the lawyer’s hands. And that is one reason why so many lawyers work many weekends and fail to take off sufficient time to relax and recharge. —Jim Calloway

Real estate: brick-and-mortar or virtual?

13. Both. You should have the capability to deliver service both in person as well as virtually. That said, there are a variety of ways to accomplish that objective. To me, the key is building your practice from your clients’ perspective. For example, how will your clients prefer to communicate with you? How will they prefer to complete/sign documents? How will they prefer to pay you? At the risk of stating the obvious, they won’t all prefer the exact same things. Be prepared to provide options. While this may be lower on your list of considerations, keep in mind that Google My Business (the premier real estate on search results) requires an actual physical office location. If your marketing strategy relies heavily on winning clients from local search, that alone might be enough reason to maintain physical space. —Gyi Tsakalakis

14. Whether you need an office depends on the type of law you practice and what your clients expect. In your area of practice, do clients want to physically meet with their attorney? Even if the answer is yes, you may not need to be physically present all of the time. An executive space or sublet space may work perfectly. You have more options than ever before. —Billie Tarascio

15. Many legal services will be delivered virtually going forward. Lawyers have always served out-of-state clients. The tools are just better today. At a minimum, a lawyer needs a location where certified mail can be received and deliveries are dropped off. Plus, there will be a need for physical meetings with clients and others. Depending on the work-from-home situation, a lawyer may need a physical office location for an uninterrupted workspace. Many law firms have downsized and have extra space available that could include reception and access to a copier. Renting a U.S. post office mailbox is better than listing a home address on documents publicly filed with a court. —Jim Calloway

16. There are three main reasons lawyers pay for expensive office space: 1) to have a place to work; 2) to have a place to meet with clients; and 3) to impress clients and opposing counsel. If more of your employees are working remotely, these reasons don’t mean much anymore. We suspect when this pandemic is over, many firms will adopt a model similar to what firms like PwC have been doing for years: a series of unassigned workstations that any employee can sit at and plug into. —Patrick Palace

How big do you want your practice to be?

17. Give this some real thought. I started with a small goal: My husband and I decided that if I could build a certain income stream, it was worth giving it a second year. It wasn’t the income I wanted long-term, but it was a first-year goal. At some point, you have to decide what is the biggest you want the firm to be. The more specific you can be with it, the better. Your goal informs decisions like when (or whether) to hire other lawyers, when to turn down work, whether to expand geographically or into new practice areas, and other critical questions. —Megan Zavieh

18. The size of your practice depends on what area you want to specialize in. One factor to take into consideration is how popular your practice is in your area. Another point is whether you want to take on fewer higher net-worth clients versus many lower-to-middle-class clients; you may not need a lot of manpower. Evaluate what specialty you’re practicing to decide how much manpower and the services you need to offer. —Jack Newton

19. For most solo or small-firm lawyers, growing the firm may not mean adding more lawyers. That may be a good plan if you need more hourly billers or attorneys available for court appearances. But outsourcing to virtual assistants, contract lawyers and automated services is often a better alternative. This allows a firm to ramp up the support services when there is lots of work and reduce them when they are not needed. —Jim Calloway

What kind of fees should you charge?

20. Don’t limit yourself to billable-hour thinking as you develop your fees and pricing. Flat fees reward efficiency and experience, but a sliding scale or unbundled fees can also help you serve more people in your practice and provide access to legal help to those who might otherwise struggle to get it. —Aaron Street

21. New lawyers starting a practice need to determine an appropriate hourly rate for legal services, whether they will be using that as a primary method of client billing or not. Many bar associations will not be able to offer much help on this due to antitrust concerns. It’s OK to ask other lawyers in your area what they charge; this is one bit of information that few mind sharing. New lawyers will likely set their fees lower than experienced lawyers and write off more time as they are doing things for the first time. But if your clientele is mainly individual consumers, where you can set a fixed fee for a legal service, you will find clients appreciate the certainty of the fixed fee. —Jim Calloway

22. Alternative fee arrangements! Yes, we occasionally use hourly billing alone for some cases, but we try to combine it with other components. We really like to offer a hybrid model for many cases: Start with a handsome flat fee for investigation and advice, which, when completed, converts into hourly billing. This is helpful for cases in which (a) the client is hesitant to hire you because of the uncertain nature of hourly billing, and (b) litigation could open a can of worms down the road. So if you start with a good flat fee, you could charge an hourly rate for services related to the initial scope but not necessarily contemplated in the scope. —Inti Martínez-Alemán

23. I like an enhanced hourly/contingency fee system. Make no mistake, the large firms you are competing against understand the hourly billing system—and it works. If you can be more efficient, that system can work for you as well (and better for the client). I have yet to see a flat fee system that benefits the attorney, although I understand its appeal to clients. Be prepared for difficult times if you choose to 1) be the low-price leader or 2) develop a subscription-based model. I think both can work, but you have to spend your day on the hustle and not necessarily on legal work. —Brian King

24. As a student loan lawyer, most of my law practice is transactional-based. The little litigation I do is fixed and routine. So for me, it makes total sense to charge a flat fee. Now, the key to charging a flat fee is to charge a high enough fee where you don’t hate your client for doing the work for them and a low enough fee where they don’t hate you for what they’re paying you. —Stanley Tate, Tate Law

What kind of tech should you use?

25. Focus on technology that both improves your clients’ experiences and makes life easier for you. And if you have to pick between the two, pick client experience.

• Client relationship management software: Organize all your professional contacts and create systems to create, nurture and solidify professional relationships.

• Marketing automation: Nurture contacts throughout their hiring journey.

• Scheduling/conferencing: Make it easy for people to schedule time to meet with you. (I like Calendly + Zoom, which integrates nicely with Google Calendar.)

• Virtual receptionist: Someone has to respond to inquiries remarkably fast and competently. It’s unlikely you’ll be able to effectively handle this on your own.

• Document automation: Make organizing and executing documents a better experience for clients (particularly with respect to digital signatures; don’t make people come to your office to sign documents).

• Web presence: fast, reliable website hosting; WordPress; responsive design; Google My Business and social media.

—Gyi Tsakalakis

26. Use things that are low-cost, cloud-based and typically don’t require you to know how to code. There are literally dozens of options in every tech category—just find the ones that work best for you and integrate with your other tools. My No. 1, hands-down first criteria when searching for tech is, “Does it integrate with Zapier?” If not, it has major points off. —Jessica Birken, Birken Law Office

27. I’m pretty tech-savvy but stay away from fads in legal tech. Too many to choose from! I ask myself, “Do we really need it, and will it make us happier at work?” If not, I decline. I also think of revenue over cost: Will this $1,000 investment pay for itself quickly? If so, let’s do it. If not, don’t fall in the trap just because every colleague of yours is doing it. There’s no one-size-fits-all approach to running a law firm. —Inti Martínez-Alemán

28. Use the tech that works for you. You’re not going to know what that tech is until you start using it. For instance, many of my colleagues use branded practice management SaaS [software as a service]. I tried them all but realized many of them didn’t work for how my brain worked, so I built a custom one using Airtable and Zapier integrations. The tech I think is nonnegotiable, though, especially as a solo, is a scheduling tool like Calendly, an online payment system like LawPay, a virtual meeting tool like Zoom, and an e-signature tool like HelloSign or PandaDoc. Those tools are all time-savers because they allow you to work quickly and efficiently. —Stanley Tate

29. Lexis and Westlaw—both of which require a minimum yearlong commitment—are no longer the only game in town for legal research. Both Casetext and Fastcase offer month-to-month subscriptions. Additionally, Fastcase access is a member benefit for many bar associations across the country, while Casetext is a member benefit for a few. Lawyers can get discounted access to Casetext through a few local bar associations. Talking about free, you may find that Google Scholar is sufficient for your research needs. —Lisa Solomon, Lisa Solomon, Esq. Research & Writing

30. Implement a docketing system. You need to have a way of keeping track of cases. You should think about this in advance. Are you going to use a calendaring system? An off-the-shelf program that’s being offered to legal professionals? Do your research and get it in place before you open so when you start accepting matters or cases, they go right into your docketing software so you never risk missing deadlines or client notifications. —Josh Gerben, founder & principal, Gerben Perrott

What are the nuts and bolts you should concentrate on?

31. You will need a business account and possibly a trust account. Get to know your local business banker, and weigh the pros and cons of a national bank vs. a local one. —Billie Tarascio

32. Digitize every record. Every physical document you receive should be immediately scanned and stored safely on a secure cloud site where it can be easily accessed. While a regular complete backup of your computer is still important, the standard today is having the information where it can always be used and updated no matter what. A busy lawyer cannot afford to be locked out of data, waiting for a new computer to be shipped or waiting for someone to help them restore from the backup. —Jim Calloway

33. If you have been in a firm and never had to handle the money before, take the time to read your bar rules on trust accounting. If the bar offers a class, take it. Open your accounts correctly and choose a separate bank for your IOLTA (Interest on Lawyers Trust Accounts). If only your IOLTA is at that bank, you drastically reduce the risk of many common errors (such as depositing funds in the wrong account, having electronic transfers into and out of the account, and bank errors). —Megan Zavieh

34. If I was hiring one person, I would start with a fantastic accountant. The collection of money will make the difference between what you bill and what you net as take-home. —Brian King

35. You have to have a corporate entity for liability protection—in most cases, you’ll use a limited liability company, or in some states they’ll be called professional limited liability companies. You’ll likely want to be an S corporation, which is a tax designation that allows for pass-through taxation on your income. Talk to your accountant if you need to set up as an S corp. —Josh Gerben

36. Get your malpractice insurance in place—and general liability coverage that you’d normally have for a business. Malpractice insurance is an absolute must in today’s world. Get it in place. It’ll be expensive and painful, but you have to have it. There are plenty of carriers out there. Talk to an insurance broker about what other types of coverage you should get. —Josh Gerben

37. You must accept credit cards—getting paid faster and easier is going to be critical. You don’t want to have accounts receivable as an attorney. That means you’re waiting on that money to come in—when you’re a small firm, oftentimes you can’t wait for it. When you’re just starting out, the quicker you get paid, the better. Some people don’t like credit cards because it costs 2%-3% off the top. In the vast majority of our engagements, we require payment upfront to begin work or a retainer. It’s easy to get people to give us their number right off the bat, or they use our secure online portal. I use Authorize.net. —Josh Gerben

38. Remember, especially if you’re starting a business for the first time, that you still have to pay taxes—and that no one is paying them for you anymore. You must pay your federal and state taxes on a quarterly basis, and you can do it online. Set up an account at EFTPS.gov to pay federal taxes online, and if you live in a state with an income tax obligation, find the online portal and pay there, too. More attorneys starting law firms than I can count have reached out to me at the end of their first year with a large tax liability and no way to pay. Save yourself the hassle. Remember that the taxman always gets paid first. —Jared Correia, CEO of Red Cave Consulting

39. I used a more traditional name when I started because I wanted clients to know that we were a real law firm because we were mostly going to be advertising online to obtain clients. In the last 10 years, there’s been a shift toward using names of firms that are not just the last names of the partners. You can build a brand into a firm, and it’s not reliant on everybody sticking around. —Josh Gerben

How can you market your new practice?

40. Many lawyers launching law firms ignore an obvious traction point: their existing networks! So gather up all the emails you have (yes, literally all of them), and send out a grand opening announcement via an email marketing program. You may never get more views than when you make an initial announcement for a new business, so don’t miss the opportunity. —Jared Correia

41. How do potential clients use the internet to find legal services? In most cases, search engines are the easiest, most accessible means of finding information. Lawyers who understand how people use search engines to research lawyers and to find answers to their legal questions can earn meaningful attention and new clients. Eighty-six percent of consumers start with Google when searching for a lawyer online, as identified in a study by iLawyerMarketing. —Jack Newton

42. According to the 2019 ABA TECHREPORT Survey, only 47% of firms overall have a marketing budget. Effective marketing starts with a budget. Your marketing budget should include both time and money. If you’re short on money, be prepared to spend more time. In fact, even if you have money, be prepared to spend time on marketing. Keep in mind that the business of law is still largely a relationship and reputation business. Therefore, your marketing should focus on investments in relationships and evidence of your professional reputation. This means delivering better experiences to everyone who comes into contact with you and your firm. Invest in deeply understanding who you help, how you help them and why you are uniquely qualified to do so. —Gyi Tsakalakis

43. Your unique selling proposition is your story. It’s what makes you totally different from the lawyer down the street. When you design your marketing or write your bio, line it up next to 10 other attorney bios. Give them to your spouse or friend without names, and ask him or her to pick out which one is you. If he or she cannot easily do so, keep looking; you haven’t found your unique story yet! —Billie Tarascio

44. Make sure your marketing spend leads to specific clients. Too much of the time, marketing dollars are spent trying to “create a brand” when most legal services come one client at a time. Wisely spend money on internet marketing and gifts. You want to have 20 good referral sources and treat them like gold. —Brian King

How can you establish a healthy company culture?

45. Think about what you want in your ideal boss, then try to be that with your first employee. Read about organizational culture and what it means—they don’t teach this in law school, so you’ve probably got some homework to do. Your law firm culture will be created whether you try to create one or not—so make sure you consciously cultivate one. —Jessica Birken

46. Right now, company culture is a major make-or-break factor for prospective employees, especially with COVID-19 and remote work. Whether you’re building a large business or an intimate practice, culture means everything. As part of your business plan, remote-working conditions, comprehensive health care benefits, time-off policies and professional development opportunities for employees should be just as important as the services you offer clients. People are keeping a close eye on work-life balance during this pandemic, so you want your company to be a place that welcomes people of all backgrounds, locations and paths of life. One specific area you can focus on right now is offering flexible work options if you are going down the path of opening a brick-and-mortar location. Work from home is vital for many right now, and it is a perk that can boost employee morale and overall culture. —Jack Newton

47. Starting a practice is a big step, and you will have setbacks. You have to be prepared for those and be ready to bounce back. Since you don’t know what they’ll be, the best thing you can do ahead of time is have appropriate coping tools in place. Know how to reset your perspective, have an accountability partner who can help pick you up, and know what you’ll do when you are feeling low. To be able to be resilient, you have to take care of yourself. It’s hard to make self-care a priority, especially when the life of the firm depends on you, but if you burn out, the firm is destined to fail. —Megan Zavieh

48. Business is full of peaks and valleys. There will be good months and bad months; you have to hang in there during the bad months and know that the good months will come. You need to plan for the bad months. Use the slow periods to learn. Learn about running a business; learn about marketing; learn about anything that can help you. Sign up for every free webinar about running a law firm, marketing and branding. Find another attorney who you can talk to—someone not in your practice area—that you can trust. Stay calm and don’t panic. —Jodi Ann Donato, Donato Law

49. Being a solo is like riding a roller-coaster of emotions. Some days are awesome. Other days suck. And sometimes, those emotions come through on the same day within a one-hour window. The key is to keep plugging away. Soon, you’ll have enough experiences built up that you’ll be able to better modulate your emotions. That said, I’m seven years in. And when it’s Thursday and I haven’t booked a new client, my anxiety kicks in. And I start looking at what marketing I could do more of or better, or both. —Stanley Tate

50. If 2020 has shown us anything, it’s the value of resilience. Pivot, adapt and be open to the possibility that the practice of law is changing, and largely for the better. Clues are everywhere that the client-focused law firm enabled by tech is here to stay. There is no “set it and forget it” with running your own law firm, so make sure to set aside time to work “on” your business and step back to determine what needs to change. —Aaron Street

This story was originally published in the April/May 2021 issue of the ABA Journal under the headline: “Launch Codes: 50 startup tips to get your practice off the ground.”