5 tips for starting a law firm
Starting a law firm is much the same as starting any services business, but with the added complexity of having to deal with a regulatory body and all the compliance obligations they impose on us. It can feel overwhelming trying to navigate all the different aspects you need to think about and knowing where to find the support you need, so it’s easy to put it off for another day…year…decade.
I want more people to start law firms, so I’ve written this article to help make that a reality. It’s not impossible – I’ve done it myself so I know - but it’s not easy and you need to fully commit to making it happen to ensure you don’t give up at the first obstacle.
So, here’s my 5 tips on starting a law firm…
#1 Be sure you need to be regulated
Whilst I can only speak to my experience in the UK, I’m sure there are pros and cons of being regulated in any jurisdiction. One of the main reasons I chose to be regulated was because I felt I needed the credibility that being regulated affords. However, that ‘stamp of approval’ comes at a hefty cost, so you need to be sure it’s worth the price tag.
Whilst being regulated may feel manageable at the start, it’s worth bearing in mind that it becomes more of a challenge if and when you grow your business. Professional indemnity insurance is expensive, the client account rules are a minefield and, like me, you might find the restrictions imposed on you frustrating when you’re trying to do something new and different.
The area of law you practice in might mean you don’t have a choice, but there are lots of things you can do without being regulated so be sure to familiarise yourself with the rules. It’s always possible to apply for regulation in the future so, if you’re not sure, it might be worth holding off because it’s much harder to reverse the decision.
#2 Be clear why your law firm needs to exist
I talk a lot about purpose, and you can read my article on the business case for purpose-driven strategy here.
I started my law firm because I couldn’t find a law firm that I wanted to work for. It was either that, or leave law altogether. I was so fed up with the traditional thinking, the prejudice and discrimination, and the lack of tolerance for individuality and creativity, that I wanted to create a business where individuals, including me, could be themselves.
You need to have a reason for starting a law firm that’s more than making money. Of course, making money is important, but you can make money working for someone else. It’s not going to set your business apart from all the other law firms out there and it’s also not going to give you something to fall back on when things get hard and you can’t remember why you decided to start a law firm.
So, make sure you know what your ‘why’ is, and write it down so you can come back to it in the future.
#3 Build a support network
There are lots of people out there desperate to tell you that you’re about to commit career suicide. That they once thought about starting a law firm but it was impossible, so there’s no way you can do it.
For reasons I’ve never understood, many people find it hard to support those brave enough to start their own business. So, if you’re going to take the leap, you need to surround yourself with people who will cheer you on.
When I started I scoured LinkedIn for people who had started their own firms. At the time, there weren’t many and, thankfully, it’s much easier to find people now. I sent messages to people asking for their advice, and now I’m the one receiving these messages. It’s weird how things work out.
I didn’t appreciate the value that a support network brings until I had one, and I never intentionally built one. But there’s no question that being an entrepreneur can be lonely, and no-one really understands what you’re going through unless they’ve gone through it themselves.
So, use LinkedIn, join founder groups and look into incubator programmes and start building a community of legal and non-legal entrepreneurs. It’s well worth the effort.
#4 Get the experts in
As a founder you’ll inevitably end up wearing multiple hats as you roll up your sleeves and get stuck in with everything that needs doing. But there are some things I don’t recommend doing yourself, and it’s important to recognise when you need to enlist the help of an expert.
Unless you’re also a graphic designer, getting a good designer to help with your logo and branding is really important; there’s not much worse than a cheap DIY logo or website. You don’t need to spend a fortune, but you need to ensure you’re launching a brand that’s visually appealing to your target clients and will set your business up for success.
I hired an accountant at the beginning. Whilst I learned loads in short space of time, I knew how important it was to get the financials right, and that I’d never be as good as an expert.
The rest really depends on how comfortable you are with the various aspects of your business. I’ve always enjoyed marketing so I was able to handle the business’s marketing for quite a while, but if you don’t know your arse from your elbow when it comes to creating a presence online, please find someone who does!
#5 Learn to sell
Shortly after starting my business, I realised that being able to sell was the difference between its success and failure. I didn’t know that I could sell – I’ve never had any training – and for a while I didn’t even realise I was selling. But the bottom line is, to be a successful law firm owner, you have to be able to sell.
As law firm owners we sell in the following ways:
- We sell our services to new and existing clients
- We sell our competence and business plan to investors and lenders
- We sell our credibility to strategic partners and suppliers
- We sell our vision to prospective and existing employees
I’d always associated the word ‘sales’ with the used-car-salesman stereotypes - it implies manipulating, pressuring and cajoling. But, if you think about it, selling is actually just explaining the logic and benefits of a decision in a persuasive manner. There’s nothing dirty about it; it’s not about forcing someone to buy something they don’t want to buy.
Selling is essentially a communication skill which we use in so many aspects of our lives. To be effective, we need to demonstrate how we can solve a problem and add value to someone else’s life. This means we first have to first listen and understand; if we don’t know what the problem is, we don’t know if we can solve it.
As well as being able to communicate effectively, selling requires confidence and resilience. It’s not about pretending to be someone you’re not - these are all skills that can be learned – anyone who talks about being a born salesman is talking nonsense. You can learn on the job, like I have, or learn from other people, or a combination of the two (which is probably the best approach). There are lots of good books, videos and training courses available, so all you need to bring to the table is a willingness to learn.