Have you always wanted to work for yourself? Perhaps you are tired of working in a soulless office, fed up with partnership politics, or not being properly paid for the work you bring in.
There is a lot to love about the legal profession. But let’s face it, there are a lot of reasons to want to move away from being labelled as a “fee earner”, a cog in the machine.
2021 might be the perfect time to start a law firm of your own.
The good news is that the barriers to entry are lower than ever. Technology continues to democratise all aspects of business. Regulation has become more flexible. There is a thriving gig economy, including lawyers and support staff.
You can put all of these things to your advantage to start your new chapter. And without all the legacy (and baggage) of an old firm.
In this post, we will set out our top tips for setting up a new law firm in 2021. And just to point out in case you are wondering, any recommendations made here are not driven by self-interest – they are genuinely meant to be helpful.
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Everything you need to start a law firm
1. A vision and business plan
First up, some basics. Setting up any new business is not to be taken lightly. You will need some sort of vision or purpose for your business.
Are you setting up a small boutique firm to give yourself some freedom?
Do you have a drive to help a certain demographic, or fight for justice?
Maybe you want to disrupt how law is traditionally practised, or have identified a new market.
You may long to start a non-profit making law firm. Or maybe take over the world by raising capital and consolidating lots of smaller firms.
Whatever your vision, you will need to build your strategy around that. Your vision is your cornerstone. It dictates who you employ, what services you offer, how you serve clients and how much you charge. And everything in between.
Vision is very often documented as part of a business plan. This is an essential document, but it need not be War and Peace.
The purpose of your business plan is to set out what the new law firm will look like in the first one to three years. (Anything longer is crystal ball gazing).
You will want to use the document as a tool to:
- Organise and refine your strategic thinking
- Explain the business to outsiders – insurers, banks and regulators are likely to want to understand what they are getting into, so being able to clearly communicate your vision and operations is important
- Keep yourself on track, so you don’t lose sight of the big picture and key metrics.
At this point, you can start getting excited about innovative business models that you can put in place. Flexible regulation and ownership structures mean that you are no longer tied to practising law in a ‘traditional’ way (although there is nothing wrong with that!).
If you can spot a gap in the market, or a way of leveraging your regulated status in a way that puts you ahead of the competition, you can give yourself a huge advantage.
We always say that if you can picture a way of practising law ethically, even if there is nobody else doing it, there is probably a way that it can be done. Regulation should not get in your way these days.
Some examples might include:
- White labelling your services
- Outsourcing delivery of your services
- Reinventing a process
- Automation and artificial intelligence
- Having a large team, but no employees
- Becoming part of a wider group structure
- Adding a ‘bolt-on’ law firm to an existing set of non-legal services
- Creating a vehicle to only do reserved work (e.g. obtaining probate), whilst keeping the unreserved work separate (e.g. will writing)
We pride ourselves on being able to think about the commercial possibilities for modern legal practice. You can always contact us for a free consultation about your plans, and how we can help make them a reality.
Also, consider getting a business mentor or coach. Find someone that you trust has your best interests at heart and use them for sense checking, accountability and counsel.
We really like Michelle Peters’ (The Business Instructor) approach to building profitable legal businesses. Michelle is an ex-lawyer turned strategic business coach, with some fantastic frameworks for attracting, converting and retaining more clients.
A law firm is a vehicle for people (well, at least one person) to practise law. At least until the robots take over, but that’s slightly off-topic.
Your vision will dictate how many people you actually need from Day One. Do bear in mind that payroll is usually one of the biggest overheads for any business. You do not want to over staff and run out of cash.
So resourcing will be an important part of your business plan.
All regulated law firms need at least one practising lawyer at the top i.e. as a partner, LLP member or director.
Under SRA regulation, which is where most law firms in England & Wales sit, there also needs to be one person with at least three years of post-qualification experience. That person does not necessarily have to be at ‘partner’ level, but they will be responsible for supervision in the firm.
Most insurers, however, will want five years of post-qualification experience.
Recruiting lawyers is hard. We know because we tried our hand as a legal recruitment agency and it failed.
Attracting lawyers away from a safe salary and defined career path to join a new start-up is even harder. This is where your ability to articulate your vision comes into play. Either that or offer above-market rates for the person you really want to target (but beware, that can cause greater difficulties down the road).
You could spend weeks trying to butter up candidates on LinkedIn, and spend thousands of pounds on job boards (without really knowing what you are doing). Or you could ask a professional recruiter to help.
A good recruiter has the skills to sell your vision and match appropriate candidates to your business. And they may just have the perfect candidate already on their books.
There are unfortunately lots of poor recruitment agencies out there, so take care. Ask your network for recommendations.
We consistently hear great reports about TP Recruitment. And not only are they unusually transparent about their pricing, they even donate 10% of their profits to charity.
Tip: avoid any recruitment agency that does not specialise in the legal sector, or does not have a long track record.
3. Financial projections – show me the money!
Realistic forecasting is critical. Regulators and insurers expect to see well-thought-out financial models showing where the income is expected to come from, what expenses you anticipate, how you are funded, and whether you are going to run out of cash.
However, this is a case of knowing your audience. As the business owner, you will no doubt need in-depth forecasts. But regulators and insurers are not accountants, so do not need to see overly complex modelling. It probably would not mean much to them anyway, and may even complicate the picture unnecessarily.
As a rule of thumb, we suggest a two-year projection of:
- Profit and loss account
- Cash flow statement
- Balance sheet
This process alone will force you to think about the numbers. You might presume that your client pipeline and minimal overheads equals profit, but of course, you need to plan the finances much more carefully.
Law firm finances can be very “lumpy”. Some practice areas, such as litigation, can involve carrying very hefty disbursements and work-in-progress (WIP) until the end of the case. Professional indemnity insurance and regulatory practising fees have to be paid once a year. VAT and taxes will come in regularly. Your income will rarely be consistent – Christmas and summer holiday periods are often quiet times for law firms.
In other words, you may have to think about financing options, talking to your bank or financial adviser about overdrafts, or accessing external capital. Maybe it just means delaying the launch until you can build up more of a fighting fund.
Sound a bit daunting? You are not alone. Most lawyers shy away from the numbers.
Now is the time to get friendly with a good accountant who understands law firm finances. If you have the budget, appointing a portfolio financial director from Day One is an option, too.
The Law Society usually endorses an accountancy practice, so that is worth looking into.
We also know that Price Bailey has an excellent reputation amongst its many law firm clients, and comes highly recommended.
If you prefer to stay local, your local law society is the best place to ask for recommendations.
For financing your law firm, from expensive insurance premiums to general working capital, talk to our very own Paul McCluskey, who also runs Gemstone Legal. As an ex-senior banker, there is nobody better placed to give you no-nonsense advice about your financing options.
All regulated law firms need to have professional indemnity insurance under the regulator’s scheme rules. The SRA, CLC, BSB (etc.) all have their own requirements.
The SRA insists on professional indemnity insurance under its ‘Minimum Terms’. There are a number of insurers who have signed up to this gold-plated policy wording. See the list of participating insurers.
You will need to get a quote from a participating insurer before you submit an application to the regulator to get your firm authorised. Cart before the horses, perhaps, but it’s one of the many hoops you have to jump through.
Essentially, if the regulator can see that your firm will be insurable, that de-risks their decision to authorise.
Although there is no magic formula, we often see professional insurance insurance quotes ranging from four to eight per cent of predicted turnover. However, in a harder market it can be significantly more, particularly if your business model looks slightly different.
Yes, insurance can be very expensive.
Insurance advice is a profession all of its own. But the basic premise is that, in order to obtain insurance at an affordable premium, you need to convince the insurer that your new law firm will be a sound risk.
That means, telling them all about:
- your business model and projected finances
- how you are going to manage risk and compliance in the firm
- who will be undertaking the work, their skills and experience
- what practice areas you will specialise in
These matters, and far more, are covered off in the insurance proposal form your broker will give you. They should advise you about how to frame your proposal to the insurers.
The insurance proposal should be treated as a critical strategic document – not a piece of admin!
Speaking of brokers, make sure you use a specialist in solicitors’ insurance. Your broker needs to know the market inside out – with a direct line to individual underwriters, if possible – in order to serve you well.
We always point our clients to Ntegrity Professional Insurance. We like Ntegrity because they are straight-talking and position themselves to help their law firm clients, rather than being simply insurance sales-people.
In a profession driven by commission, it is vital that you trust your broker is working in your best interest. The team at Ntegrity certainly does that.
Tip: don’t forget to budget for other insurance policies such as EL/PL, directors’ liability, cyber, and equipment.
5. Regulatory application
So you have planned out your business, lined up the key people, and have got an insurance quote. You’re almost ready to submit your application to your chosen regulator.
But hold on a minute! Now is the time for a sense check: do you really need to be regulated?
That might sound like a daft question, but these days it is a very relevant point. There are entire swathes of legal practice that do not technically require regulation or to be performed by a practising lawyer.
Will writing, estate administration, employment, pre-litigation, legal advice, general commercial and corporate practice – these are all examples of legal services that are generally provided by regulated law firms, but which do not have to be.
It is technically only the reserved activities (as set out in section 12 of the Legal Services Act 2007) that need to be carried out by regulated people. (In the case of claimant employment, you may have to register with the FCA as a claims management company – in which case, the SRA may be an easier route).
And post-November 2019, solicitors can also practise outside of a regulated law firm. Either as a freelancer (which means as a true sole trader, they can provide all of the reserved activities) or as employee or principal of an unregulated business (the limitation being that no reserved activities can be supplied).
The result being that the system is more flexible than ever, and the question “do we want to be regulated?” is not necessarily that simple to answer.
Of course, there are very many reasons why your new law firm may opt for regulation, even if not technically required. Client protection, perceived legitimacy, and branding to name a few.
Assuming you do decide to apply for regulation, you will need to make a formal application to the regulator. We specialise in SRA authorisations and have a 100% success rate.
You will need to decide whether your new law firm will be a ‘traditional’ firm or an Alternative Business Structure (or ABS, also known as a licensed body).
An ABS is a relatively new type of law firm that allows non-lawyers to own and control them. This was introduced to increase competition in legal services, by bringing commercial skills and external capital into the profession.
About one-tenth of all SRA law firms are ABSs. A much higher proportion of new law firms apply through the ABS route.
Whichever route you choose, you will be required to submit an application pack to the Authorisation team. They will then assess your application for eligibility and will look at any key risk areas. They will ask questions to ‘stress test’ your application, making sure it stands up to scrutiny.
The process may also include having to make applications under the Money Laundering Regulations as well as DBS background checks.
The timescale to a decision is anything from a few weeks (we have had applications turned around in less than four weeks) to a few months (in complicated cases). Technically, the legislation allows the regulators to take up to a year. But the SRA has an internal service level of three months, which they do not like going beyond.
The cost of the application depends on what you are asking them to authorise. A simple ABS structure with four Directors would for example attract an SRA fee of £2,600. You also need to budget for insurance and other start-up costs.
Assuming they decide to authorise, you will then be issued with a licence and be free to start trading, subject to your insurance policy going live.
The SRA application process has vastly improved over the past few years, but it can still be overwhelming. Since you only really get one shot, we recommend that you get specialist help from someone that has been-there-done-that multiple times, and can advise you on how to improve your chances of a successful application.
We can only speak for ourselves, but we are regularly told by our clients that investing in external project management has been worth every penny.
Contact us for more information.
Whether you are starting ‘lean’ or jumping straight in with a large team, these days IT will be an important Day One consideration.
Do you start off with a full-on practice management and case management system? Or is that overkill for you at your kitchen table? Perhaps you can hack together some inexpensive software (e.g. Office365, Google Workspace, Dropbox) to do 80% of what you need it to, and optimise later.
But if you intend to be more than a one-person-band, cutting corners on IT at the outset can be a false economy. You have to factor in the cost of migrating everything into a ‘full’ system when the basic tools are no longer doing the job.
Very often, you might as well have started as you mean to go on.
Most start-up law firms use cloud computing these days, so all you need to work on files is a laptop and internet connection. You can leverage the provider’s systems to start small and scale when needed. Usually, this just involves adding new licences.
But if you do plan to create your own IT infrastructure you will need to budget for expertise, hardware, software, maintenance and support.
If you have a client account, you will need software to manage those ledgers – unless you fancy some traditional double-entry bookkeeping and manual three-way reconciliations. Your accountant will be able to recommend a suitable IT package. (We use Xero, which is a powerful bit of kit that integrates with a lot of other software).
Data security should also be a priority – as a processor of highly confidential and valuable data, you will be a target for malicious and opportunistic criminals. Most law firms have been attacked by cybercriminals. So you will need robust cybersecurity defences.
And don’t forget telephones. You can start out using mobile numbers, but most law firms prefer to offer a landline option. Most serviced office providers will include a dedicated number. And there are dedicated telephone services, who will answer your phones as if they were sitting in your reception area.
There is a huge choice of legal software out there and, to a large extent, your choice will be based on personal preference. Some systems are not compatible with Apple Mac, so that might limit your available options.
Solicitors Own Software (SOS) is a great option for most new law firms. It is intuitive, reliable, scalable. and just feels like the type of software lawyers should use. Plus they have an excellent outsourced legal cashiering service, which will be significantly cheaper than employing a bookkeeper.
Moneypenny constantly comes out as a top choice for switchboard and telephone services. Very friendly and professional, you would never guess that they were not physically part of the firm.
We have found Soho66 to be a really reliable, powerful and cost-effective VOIP system (internet-based telephone line). You can use it with desk-based and mobile handsets.
7. Compliance and risk management
This is a very broad topic, but assuming you are an SRA-regulated law firm, there are lots of rules and regulations to comply with, including:
- SRA Standards and Regulations
- Data protection legislation
- Anti-money laundering rules
- Bribery and corruption
- Distance selling and ‘off-premises’ contracts
- Insurance distribution
- Financial services
- VAT and tax
You will need to appoint a Compliance Officer for Legal Practice (COLP) and Compliance Officer for Finance and Administration (COFA). These officers are responsible for compliance and are the eyes and ears of the regulator. They also come with an element of personal liability, just to keep you on your toes.
Your regulators also expect you to be an adept risk manager. In practice, this means having systems in place to identify risk (internal and external), take mitigating action where necessary and keep an audit trail.
Special mention must go to Anti-money laundering (AML) and Data protection compliance.
In terms of AML, for most law firms their legal regulator (the SRA for most solicitors) will also be their AML supervisor. The SRA has considerably stepped up its game in the past year, after a sluggish response to the 2017 Money Laundering Regulations. They now perform spot checks on firms and will expect to see evidence of firm-wide risk assessments, policies, independent audits etc.
From a data protection perspective, new law firms have a brilliant opportunity to design how they are going to process personal data before doing so. You will need to think about what type of personal data you will handle (this will vary considerably depending on your areas of practice and whether you employ staff or outsource), who you will share that with, how long you need to keep it, and how you will go about deleting the data once you no longer need them.
You can make sure your new IT systems (whether it is basic cloud software or a fancy Practice Management System) has the ability to delete data in line with your retention policy. You will need to create a data processing map to document this and help you write your data protection notices. You will also need to register with the ICO.
For a new law firm, all of this can be a huge burden, and if you are not careful you can easily spend a disproportionate slice of your working day just making sure you are following rules.
Could your time be better spent winning new clients, delivering a great service and managing the business?
That’s why we developed COLP-Help, our outsourced compliance service. Think of us as your virtual compliance team. For a monthly no-commitment retainer, our team makes sure you are compliant with all the rules. Leaving you to run your business.
8. Business structure
SRA-regulated law firms have the choice of whether to incorporate their business or not. The SRA will regulate sole traders, partnerships, limited companies, LLPs and even public limited companies.
Take legal, tax and accounting advice on the best structure for you.
If you intend to be an ABS, you cannot be a sole trader – the definition of an ABS means that there needs to be at least one lawyer and one non-lawyer involved in the ownership and/or management of the law firm.
A law firm can change its structure as its business model evolves. So for example, a sole trader can incorporate their practice as a limited company and convert to ABS to take on a non-lawyer director.
These applications take some planning but are rarely problematic.
9. Practising address
You will need an ‘office’ address. For brick and mortar law firms, this will be your main practising address.
But you do not necessarily need to buy office space or enter into a ten year lease! The regulators are quite flexible about having serviced office addresses listed, and you can pick these up for around £50 per month.
If you are going to work from home, you can use your home address. But beware, this will be on the public record. Most lawyers are a little wary of clients turning up at their front door unannounced.
10. ID checks
The SRA rules and Money Laundering Regulations require you to verify your client’s identity. You will need some system in place for doing this routinely for every client.
If you physically meet your client it is normal practice to require them to bring ID documents and for you to keep copies. However, people will forget. They will bring the wrong, or out of date, documents. This can cause delay in starting work for them.
If you don’t meet your client then it is even more challenging. Accepting photocopies is risky. Insisting on certified copies adds a layer of friction to the onboarding process, which can leave the client frustrated.
More and more firms are now turning to technology solutions to solve this problem.
There are products available that automatically do the verification process, and which can be automated into your workflows. OK, so there will be occasions where the software can’t complete the job – perhaps through user error or unusual circumstances.
If you have ever done this manually, you know how much time ID checks can take. And if the software just checks seventy percent of your clients, that is a huge amount of overhead saved.
Take a look at Thirdfort. This nifty software takes out the pain of identity checking. It takes the client through a series of steps on their smartphone, including checking the authenticity of ID documents. It even runs background checks and can link to banks to check the source of funds.
Not only does this reduce the time it takes to verify a client’s identity, but it will also be more likely than a human to spot fake documentation.
Smartsearch is another easy recommendation for AML compliance technology. It is slick, easy to fit into your workflows, and takes a lot of friction out of the client onboarding process.
11. Bank accounts
Obviously, your law firm will need at least one bank account to begin trading. Do not underestimate how many hoops you will have to jump through just to open a business account.
You may also want to take card or online payments, so will need a payment gateway to do that.
If you are going to handle client money you will also need a general client account.
There is now an alternative to holding client money for SRA regulated firms: “Third Party Managed Accounts” or TPMAs.
TPMAs are outsourced client accounts, run by FCA regulated institutions. They work similarly to a normal client account, except that the law firm never handles the money and the client always has complete visibility of their funds.
Who needs an accounts department? Instead, you can pay a third party to take on that role and responsibility for the client funds.
Shieldpay is the leader in TPMAs, and for good reason. The technology is very slick and it is easy to integrate into your systems and workflows. And we hear that the support is top-notch too.
If you are running a client account, consider outsourcing the finance function to a specialist firm – Cashroom always gets great feedback.
If you prefer to keep it in-house, you should definitely take a look at the Institute of Legal Finance and Management (ILFM) resources. The Bookkeeping for Legal Finance Professionals Diploma is the gold standard of practical accounts management and will seriously de-risk your firm.
12. A fallback plan
It’s easy to gloss over contingency planning when you are all excited about your new venture.
But now is the best time to put in place plans for dealing with the unexpected. And if 2020 has taught us anything, it is that the unexpected will happen.
Contingency plans should cover:
- Business continuity risk – what happens if the internet breaks, we go into lockdown, or a fire destroys all your files?
- Key-person risk – what if you or one of your management team cannot work for some unexpected reason?
- What are you going to do if you get hacked?
Contingency planning is extremely important if you are a sole practitioner. If you are out of action for just a few weeks, how can you ensure that clients are not prejudiced?
Sometimes coming to a reciprocal agreement with a firm in a similar situation can help. If they get struck down with an illness, you will step in to fight fires – even closing the practice down if necessary. They will agree to do likewise for you.
Now is also a good time to be thinking generally about your exit. Remember that retiring is not as simple as handing back the keys to the office. There is run-off cover to purchase, which alone can cost three to four times your annual premium. There are client files to store, regulatory notifications to be made and so on.
Often a founder’s best hope for a clean break is to find either another firm to buy the business (a “successor practice”), or to bring on future partners internally with a view to handing the reins over to them when the time comes.
Business succession is something of a ticking time-bomb for the profession. On the plus side, instead of starting a new law firm, you might be able to find an established business to buy into.
Some solicitors on the verge of retirement will happily hand over the keys for little to no payment if you are willing to give them a clean exit. No run-off cover for them to pay and the ability to sleep soundly!
If you are thinking of going down this route, always do your homework and due diligence on the firm. If there are skeletons in the closet, the new owners are likely to be on the hook.
As an aside, solicitors without a planned route to retirement should also look at firms such as Echelon Law, who specialise in addressing this succession planning problem.
13. Marketing and business development
Quite simply, you will need to have a way of generating new business. This will be both from new clients, and repeat instructions from existing clients.
Some people are natural marketers, without perhaps realising it. They can seemingly go anywhere, speak to anyone and come back with a new client instruction.
Most people are not like that and need to put more thought into business development.
There are of course a million ways you can generate new work. It does not have to revolve around the same tired tactics that all the other lawyers use.
Some examples for inspiration:
- Strategic partnerships with complementary businesses
- Join – or start – a referral network
- Become a YouTube/Twitter/Facebook/Instagram/TikTok star
- Build an email list
- Become an expert at digital advertising or search engine marketing
- Write a book to position yourself as The Expert
- Deliver training courses to prospective clients
- Consistently write articles for the trade journals your clients read
- Become a public speaker at industry conferences
- Publish some research that the press will jump on
- Become systematic about taking prospects out to lunch
- Buy a data list (GDPR compliant, of course)
- Build a B2B sales team
- Join your local Chamber of Commerce and give talks on pressing legal issues (such as GDPR, changes caused by Brexit etc)
- Buy ad space on a billboard or the Tube…?
Your website is probably the first thing that springs to mind when you think about branding and marketing. Quite rightly so, being that it is your ‘shop window of the internet’.
A well-executed website will establish your brand identity and, more importantly, make the phone ring.
Getting your website ‘just right’ can be an exercise in trial and error. It will never be perfect. You can go through seemingly endless drafts and revisions. But don’t let web design become the barrier to getting your business started.
You may have a very simple landing page or one-page brochure site. You can build it yourself or have a freelancer on Fiverr.com do it for you. That might be enough to get you going. After that, you can go on to add content and features that will get you found on the search engines. Web development is a never-ending process.
There are very few web design agencies that specialise in the legal sector. Conscious Solutions have set out their stall in this regard, and have a very strong reputation.
We also really like Jake Schogger, who can be contacted through LinkedIn. Jake is a commercial lawyer and a gifted copywriter. Unlike many in the industry, he understands the clients’ pain points and the legal solution being offered, resulting in elegant website copy and other comms.
And some things you DON’T need to start a law firm…necessarily
Don’t forget that “law firm” does not necessarily mean ‘regulated’ (see Regulatory Application, above). A very large percentage of legal services can sit outside of regulation.
2. A new law firm
If you want to strike out on your own, you can either set up a new firm or you can buy one. There are risks and benefits to both. For example, an existing law firm will have a certain amount of goodwill, a presence in a market and possibly employees.
If you intend to enter the conveyancing market this might be the only realistic option available, since getting on the lender panels is typically such a murky, drawn-out process. Insurance is a massive headache for start-up conveyancing practices, if even obtainable in current market conditions.
Buying an established firm, or being a successor practice, comes with other challenges though. The default position is that you will take on all the liabilities, including for past claims. And it can be operationally difficult to come into an old firm as an outsider and change things.
3. Expensive premises
Technology and ever-increasing bandwidth has made entirely remote law firms possible. Some might say the obvious way to go.
Particularly in the new Covid world, who is going to want to start a law firm with an expensive lease in city centre offices? For incumbents it may make sense. But startups can use technology to their advantage.
Virtual offices can give a firm the city centre presence at a tiny fraction of the cost.
4. A massive following
Uncertainty holds back many would-be law firm founders. The safety of a regular salary is very compelling. Restrictive covenants can be incredibly intimidating. Who is going to be my client on Day One?
Now some people are lucky enough to be able to pick up a book of work and plonk it into their new law firm. That’s the exception to the rule.
The reality is that most new law firms have to scrap for work in the early days. It can be a hard slog. You will learn a lot about marketing, sales and ways to tap into workstreams. Opportunity is everywhere. Necessity is the mother of invention. People will always need lawyers.
Not that it’s a good idea to blindly jump and hope that clients find you. That’s a recipe for disaster. But you should be confident in your own abilities, and the fact that if you are a problem solver there will be demand for your services.
You can pretty much outsource anything these days. HR, cashiering, compliance – in fact, all ‘back office’ functions.
Even legal work can be outsourced. Self-employed ‘consultants’ have been used since forever, and even publicly-listed law firms have been built on this very simple fee-sharing model. If you can create a compelling offering to would-be consultants, and recruit them, you can build a law firm with very low payroll costs.
Take this a step further, you can outsource entire services or departments to other firms, with appropriate safeguards. A bit like McDonald’s being the hamburger brand that doesn’t cook hamburgers (it is a franchising and real estate business), we think there is potential to build a law firm that does not do any technical legal work. Anybody up for that as an experiment?
6. Huge IT expense
It is possible to set up a law firm with little more than a laptop, internet connection, mobile phone and subscription to a scalable case management system. VOIP phone lines are incredibly cheap.
You do not need servers, in house support teams, scanners, photocopiers or the most expensive law tech.
7. A post team
Most mail is electronic. This is a good thing from an overhead point of view. Some people and institutions may need to write to you, and you may need to accept certain documents in hard copy.
Again, you can outsource these things. One way to do this is to have all your mail sent to a virtual address and redirected to your home office.
8. A pinstripe suit and pocket square
Just a personal opinion, folks!
9. A boatload of stationery and business cards
Even before Covid, we weren’t exchanging business cards as often. LinkedIn – love it or hate it – is the modern equivalent.
And if you are sending more emails than letters, you probably don’t need 100 reams of letterhead (which can become obsolete on the whim of a regulator in any event). That is not to say you do not need a professionally designed letterhead – insurers and regulators assume that you do have something official. But these can be designed as electronic templates, rather than physical paper.
10. A library
Everything you need to know about your practice area is probably on either Lexis, Practical Law, or Westlaw. The Law Society publishes a wide range of practice-specific texts, usually around the £70 mark.
If you need something very specific, the Law Society library on Chancery Lane is free to all solicitors, and may be worth the train journey rather than splashing out on titles you may never use again.
We have also found that most law school libraries give access to guests.
And what about your local network? You might have a local firm that is only too happy to let you browse their dusty shelves.
Don’t forget that your local law society is likely to be an extremely valuable resource and worth every penny of membership. Our experience of Cardiff & District and Westminster & Holborn law societies has been overwhelmingly positive – they provide essential support to their local members. Both have been very active during recent lockdowns.
11. A secretary
Email, voice transcription, document automation and modern case management systems have done away with much of the need for traditional secretaries. You can still make a case for administrative support, but these days this can be outsourced to a team of virtual assistants for significantly less than employing a single person.
You can no doubt think of lots of other things that are unnecessary for a new law firm in 2021. We would be interested to hear your ideas!
Making the decision to strike out on your own is one of the most exciting decisions you can make as a lawyer. Yes, there is a lot to think about. There is a lot of responsibility and a huge amount of hard work.
The pay off can be amazing. You can build the legal practice that you always wished for. You can mould your professional life around your family life. You can build something that makes a difference in the world.
So come on – what are you waiting for? Carpe diem and all that!