GeneralWhat I Learned from Quitting a Stable Job to Start a Law Firm. No, It Didn’t Start as a Side Hustle

For many lawyers, going from law school to the security of an established firm is the most comfortable and stable solution. With an established firm, you can learn as you work, you have a built-in client and case load, and you don’t have to worry about running the day-to-day operations.

Unfortunately, the downsides of that may include long, hard hours, little recognition, and minimal control or upward mobility. At an established firm, you could deal with unpleasant bosses and be underpaid or overworked, missing out on the important things in life.

Maybe the best solution is going out on your own. But not so fast – starting a solo practice has its own challenges, and it’s important to be prepared for what you’re taking on when you open a firm on your own.

Here’s what I learned from quitting my stable job to start my law firm. And no, you don’t have to start with a side hustle.

Consider How the Departure from Your Firm May Impact You

How you resign from your current firm can make or break your future on your own, especially in the same practice area. It’s important that you leave on the best possible terms, and you also need to understand how the community that has your clients will feel about your leaving.

For example, will your referral sources be unlikely to send you new cases after you leave the firm? Will you struggle to get new work? Leaving on good terms may keep the door open for referrals or the existing client pool.

Whatever you do, don’t poach clients. That’s the worst way to leave your current firm and won’t do you any favors with anyone.

You can, however, speak to your firm and ask if they are comfortable sending out letters jointly to active clients. Most clients will respect your desire to be diplomatic in leaving, and you may be able to count on them for future referrals and smaller cases that weren’t feasible while you were at the larger firm.

Have a Client Acquisition Plan

Keeping a steady stream of clients coming into your firm is how it can grow and prosper, but this isn’t as easy as it sounds. You need to have a strong client acquisition strategy in advance to ensure you can bring in new clients.

You have several options, including a referral program and a marketing strategy. Both of these can cost money, however, and you need to consider these costs in your overall budget.

Initially, it may be best to focus on content marketing and thought leadership. When clients search for law firms, they’re usually searching for information related to their legal issue like “do I need a lawyer for my car accident injury?” or “what can I expect from my divorce case?”

Ideally, your content is there to provide answers to their questions and get them interested in your firm. They may look at more content or schedule a consultation with you, bringing business your way.

Plan the Financial Aspects of Your Solo Law Firm

Financial planning for a solo law firm is a big piece of the puzzle and one of the biggest challenges. While there’s no easy answer, you can plan out your expenses and determine what capital you will need.

Consider all possible expenses, including rent, technology solutions, staff, supplies, marketing, etc. Once you know your expenses, you can determine how many billable hours you will have to work to meet your financial needs.

Ideally, you should start out with enough savings to cover your firm and your personal expenses for at least a year, or two if you can. Remember, if your firm grows quickly, you may find yourself needing to put up money for more office space, more insurance, more sophisticated technology, or more employees. These expenses can significantly increase your overhead, but having some financial cushion allows you to weather the changes until you have more cash flow.

Some prenuptial agreement lawyers open their solo firms with less savings, and that’s okay. You don’t need to wait until you’ve built up your reserves to make the leap, but that will take more financial planning. If this is the case, try to keep your overhead low and limit your spending as much as you can at first.

Be Thoughtful About Banking

When you’re managing your money at a solo firm, you need an operating business account and an Interest on Lawyers Trust Account. The rules for running the Interest on Lawyers Trust Account are important to understand as well, since they’re different from traditional banking.

Be selective about choosing your bank for your business accounts. Consider the benefits and drawbacks of major banks or small neighborhood credit unions or community banks. Look at all the features and perks for small business owners.

Don’t Discount Any Possible Clients

When you’re in business for yourself, anyone can be a potential client. Prepare your elevator pitch and use it when you have the opportunity (without being pushy!). Discuss your business with family and friends and let them know that they can refer possible clients to you. These may end up being your first clients.

Also, don’t discount anyone as a possibility. You never know where your next client may come from – it could be from a chance encounter at the grocery store or while you’re at the park with your kids and talking to other parents. Don’t assume anyone wouldn’t need your services. Even if they don’t, they may have a friend or family member who does.

Make the Leap!

Having your own solo law firm is challenging. You have to do a lot of the work yourself, from attracting clients to accounting and billing to IT. It’s also rewarding, however. You can have the flexibility you want, work with the clients you want, and practice whatever area of law you want. There may be hurdles to overcome, but it’s well worth the rewards you get for your efforts.

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Author Bio: Maxwell Hills is the founder of Hills Law Group, a premier Orange County divorce lawyer law firm with a concentration on high net worth divorces. Max’s entrepreneurial career stretches back to his teenage days when he had his music used in Grey’s Anatomy and ESPN. Today, Max has used that experience to build Hills Law Group with 0 customers and $0 in revenue to a respected firm in the industry.

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