Starting a Law Firm | Business Plans | Solo in Minneapolis featured in Minnesota Lawyer

Posted on by
Reply

In an effort to post more on starting a law firm, I wanted to let my readers know that I was recently featured in a nice article on Minnesota Lawyer’s solo and small firm website:  Solo Contendre.

Reporter Dan Heilman contacted me several weeks a go to do an interview.  He was looking for my thoughts on solo and small firm business plans. I gave him my thoughts.  I won’t rehash too much of the conversation here, you should go read the article.

ARE BUSINESS PLANS REALLY NECESSARY FOR STARTING A LAW FIRM?

My two cents is that you probably should create a business plan for your law firm, but it doesn’t have to be all that intricate.  (Then again, I’m just starting out and I could be wrong – I certainly don’t feel like I’ve “made it” yet).

My general thought is that rather than call something a “business plan” it should be referred to as a marketing plan.

Below are my answers to Mr. Heilman questions:

- Is it always necessary for a solo or small-firm lawyer to have a
business plan?

I don’t think so.  I think you need to know who your client-base is and how to reach them.  More important, to me, is having a business marketing plan.  The financial projections, overhead, billing-practices, mission statement, funding, etc. are all things that can planned-out fairly easily.  My question:  what happens when there is no money coming in the door?  I’ve read that to be a solo or small firm lawyer, you need to love marketing.  If you don’t, I think it is tough to make it.  If you are very careful and you plan-out all your expenses over a year-long period, how does that help you generate revenue and bring in clients?
Again, my thought is that a solo or small-firm business plan should be minimal and should focus on marketing.  I think lenders are more interested in seeing a nice looking business plan so that they can feel comfortable lending money.  Otherwise, I think they are generally over-rated.

- What’s a good first step in developing one?

There are a lot of resources.  The small business administration has a wealth of information (www.SBA.gov).  In Minnesota, SCORE ( http://www.score-mn.org/ ) has some great mentoring and business plan resources.  Local chambers of commerce usually have some kind of class on these subjects.  A good online source for business plans is www.Bplans.com.
For my business plan, I went to the bookstore and looked at sole proprietorship and small business books.  Each of the books has more information than anybody could possible read on creating a business plan.

- What ingredients should a good business plan have?

Business plans should have a mission statement, an overhead estimate, some annual projections for the first five years, and a strong marketing focus.  Again, a good business plan should focus on marketing.  To be sure, estimating overhead and costs associated with running a practice is very important.  However, thinking hard about how you plan to get clients in the door is the key.
Therefore, the plan should have detailed information about the what, where, when, why and how you plan to generate revenue.  What is your budget for generating that revenue once you have figured out your overhead?  How will you ensure that you stick to a marketing plan?  Are there going to be some ways to check your progress so that you know you are sticking to your goals?  If your plan isn’t working, what else can you do?
Some lawyers get very detailed with this information and others (like me) use it as a platform to keep focus.  I don’t want to get too detailed on things that I can’t really control.

- Should it stay static or evolve over time?

I think a business plan should absolutely evolve over time.  For instance, I am focusing mainly on family law in the beginning because it is easier to generate revenue in a field like family law or criminal law.  As time goes on, I plan to diversify into trusts, estates, and probate.  Along the way, I know there are going to be ups and downs.  I may find myself doing a lot of work in an area of law I had not planned on.  That hasn’t happened yet, but you never know.  A business plan is simply a goal-setting platform.  We all know that goals change somewhat over time.  So, be flexible with the winds of change.

- Any other tips for solos on creating a sound business plan?

Get as much information as you can.  Read a lot.  Don’t necessarily put anything on paper until you feel like you have a firm grasp on what you want to do.  For me, I researched as much as I could about starting and running a successful law practice.  Then, I created a relatively simple plan with some financial benchmarks.  I think setting a marketing and a revenue goal has been key for me.  It gives me something to shoot for and measure myself by.  Other than that, you don’t need to take making a great business plan too seriously unless you are looking for some start-up funding.  Of course, I am also cognizant of the fact that I could be completely wrong.

This blog post was written by Joseph M. Flanders, an Apple Valley MN lawyer.

Iowa lawyer suspended 30 days for $2,500 minimum fee.

Posted on by
Reply

As reported by the ABA Journal and Lawyerist, an Iowa lawyer was suspended for 30 days for keeping a $2,500 minimum fee on a criminal law matter.

According to the article, the lawyer only completed 3.7 hours of work  - including 1 hour spent doing an accounting.  The case against the client was ultimately dismissed and the client wanted some money back.

I don’t have more facts beyond the article.  I have read plenty of ethics opinions where non-refundable fees got lawyers in hot water or worse.  My question:  why use one?  It doesn’t seem worth the risk.

Here are my other thoughts:

  • Don’t be a jerk
  • Don’t charge more than your services are worth
  • Don’t mess with the disciplinary committee
  • Solo lawyers can have a hard time making a living

I feel a little bad for the lawyer.  $2,500 is a pretty reasonable retainer.  My dentist charges more for less.  Doctors charge more for less.  Lawyers seem to get the low end of the proverbial stick.

What are your thoughts?

 

-This post was written by Joseph M. Flanders and lawyer in Apple Valley, MN.

Starting a Law Firm | Minnesota Lawyers Mutual Roadmap

Posted on by
2

I wanted any readers out there who are either (1) contemplating or (2) starting a law firm that Minnesota Lawyers Mutual (MLM) now has a blog and roadmap for lawyers who are looking to go out on their own.

This helpful tidbit of information was reported by Andrea Hable at the Minnesota State Bar Association (MSBA) Practice Blawg.  The MSBA – like any state bar association – is a wonderful resource for solo and small firm lawyers.  Furthermore, I belong to the Indiana State Bar Association (where I am also licensed) and I can say that the MSBA provides much more in terms of its membership bang-for-the-buck.  The amount of materials, forms, etc have exceeded my expectations.  Also, the membership fees are very reasonable for new bar admitees.

The Minnesota Lawyers Mutual blog is also well done and covers a lot of good ground.  Check it out.  Topics include important things like:

  • Ethics
  • Trust accounting
  • Law Office technology
  • Billing clients
  • Collecting fees

The blog is new and it appears to be directed more towards signing up new lawyers for MLM’s malpractice insurance, but it is helpful nonetheless.

I attended a CLE last fall put on by the Minnesota Solo and Small Firm section.  MLM was there handing out goodies and the like.  For those who don’t know, MLM appears to be the big-boy when it comes to attorney malpractice insurance in the state of Minnesota.  MLM does a good job marketing themselves and their materials have substance.  I don’t have a problem doing business with an organization who sells a good product and who tries to help with quality materials.

If you haven’t gone to starting and building a law practice CLE in Minnesota (or any state for that matter) I highly recommend you do so.  The presenters and materials are excellent  and the networking possibilities are even better.

Have a great weekend!

 

-This post was written by Joseph M. Flanders, an Apple Valley, MN attorney.

Starting a Law Firm No-Nos | Minnesota Law Firm scammed to tune of $400,000

Posted on by
Reply

As reported by the ABA Journal, the Minnesota law firm of Milavetz, Gallop & Milavetz (MGM) has sued Wells Fargo Bank for cashing a fraudulent check in the amount of nearly $400,000 from MGM’s IOLTA account.  Click here for a copy of the complaint.  Bad news.

According to reports in the Minnesota Star Tribune, MGM was the victim of a scam, three-years-ago, involving someone who said she was a 40-year-old Korean woman who was hurt in Minnesota.  The woman apparently told the firm that she needed help securing a $400,000 legal settlement.  Believing her, the firm received a settlement check for the amount, deposited in the bank, and received assurances it had cleared from Wells Fargo.  The forwarded amount of the check was $396,500 and it went to a Hong Kong bank.

Reading the complaint filed by MGM is not entirely helpful.  As would be expected, the complaint is largely one-sided.  I will report on this more when Wells Fargo files its answer.

This story has been all over the news in Minnesota and is being discussed by bloggers (like me) and has been on multiple listservs which I belong to.  The general reaction?  Disbelief.

No, it isn’t disbelief that this could happen – this has apparently happened to over 70 lawyers in the United States and has cost an estimated $29 million dollars in damages.  The disbelief is related more to the fact that a law firm would fall for this kind of scam.

I don’t have all the facts, so I am not going to speculate on what happened.  My two cents is that I have been contacted on numerous occassions by scammers with very similar stories.  In fact, one of my former bosses came up to me in the halway about a year-ago and was giddy with news that he would be handling a very lucrative settlement.  He told me all about it and that it would be very little work.  He contacted the firm’s bank and they did a little investigation. Guess what, it was a scam.  He was almost duped.  My boss was a judge and lawyer for nearly 40-years.  It can happen to anybody.

Let this case be a warning to anybody out there who is running a law practice or starting a law firm that scammers exist, they are sophisticated, and you better watch your ass.

Luckily, as a small-fry solo practitioner who doesn’t deal in the hundreds-of-thousands of dollars, I don’t have to worry about scams quite as much.  If my bank was asked to clear a $400,000 check from my trust account, they would probably just laugh.  I guess that is one of the advantages of being a solo – less money for scammers to steal.

 

-This post was written by Joseph M. Flanders, an Apple Valley, MN attorney.

Starting a Law Firm | Online fax resources for lawyers

Posted on by
2

While doing the due diligence and trying to set up faxing services for my law firm, I law firm fax number - Solo in Minneapolisdiscovered a nifty little comparison website for online faxing for lawyers.  Great!

I wanted to share my find with readers of this legal blog.

The fax comparison website is aptly titled www.faxcompare.com.  Cool!

The comparison site does a really nice job summarizing different pricing options for online or “e-fax” services.  I had heard of E-Fax and they do a really nice job advertising themselves.  The E-Fax service also looks great.  The problem?  It’s more expensive than its competitors.  It pays to do a little research.

I ended up choosing Extreme Fax – mainly because it appears to offer the most and it is cheap.  I don’t send a lot of faxes, but I have found that many attorneys either (a) do or (b) expect you to have a fax number.

I have also noticed that many online directories and websites that I have been signing up for have requested fax numbers for my new firm.  I was getting tired of saying “I don’t have one.”  It was kind of embarrassing.

Anyway, go check out the online fax comparison site.  I locked in a year’s worth of faxing for about $50.00.  If I use the service all the time there is likely going to be a cost; however, I don’t anticipate using it all that much.  Scanning and emailing is so much more efficient.  Yet, some curmudgeonly attorneys want to fax stuff to me.  Now they can.

Happy faxing!

 

 

-This post was written by Joseph M. Flanders, a Apple Valley MN lawyer who practices in the areas of family law and estate planning.

Starting a Law Firm? | The Future of Law Practice and a Takeaway from the ABA Techshow

Posted on by
Reply

Great post by lawyer David Bilinsky on his blog Thoughtful Legal Management about the use of technology and the future of the law practice.

As a practicing family law attorney, I understand much of what Mr. Bilinsky is trying to say.  I do wonder, however, whether many lawyers are simply resistant to change because they are too set in their ways.

I invite you to go read the post and add your thoughts.  I don’t have a great deal to add other than the post is very interesting and though provoking.  I remember talking with another lawyer in a courtroom, lawyers-lounge a couple of years ago.  The lawyer was telling me all about how the IPad would revolutionize how he practices law.  I sat there doe-eyed as he discussed schedule management, billing, document storage, etc.  He said he could do all of this straight from the IPad.  At the time, I was a little taken-aback and skeptical.  Now, I laugh at my nievity.

I’m not saying that technology is the answer or that it is evil incarnate.  I’m just saying that the practice of law is undeniably changing and I’m not sure if it is for better or worse.

Starting a Law Firm | The Benefits of CLE?

Posted on by
Reply

I think the basis and general idea of Continuing Legal Education (CLE) is great.  CLE is meant to be an opportunity for lawyers to hone their craft, learn new skills, and get updates on changes in the law.  However, too many CLE sessions, in my humble opinion, are simply opportunities for presenters to promote what they do while, simultaneously, giving lawyers a break from day-to-day work in a place where they can play games of grab-ass ( otherwise known as networking).

I apologize for the whining.

I attended a CLE today that I was really looking forward to.  Lots of great presenters.  Great looking names.  Cool topics.  The works.  I got to the CLE this morning with my notepad ready to be filled and with a mind open to obtaining new knowledge.  Yet, after a day of taking very few notes and listening to presenters drone on about trial rules which haven’t changed appreciably in ten years and case law that I have already read, I feel a little jaded.

I did pick up a few tidbits about things which I could do better and which might help my practice.  That may be worth the price of admission by itself.  However, I don’t really think so.

Perhaps we aren’t meant to absorb much in the actual CLE sessions, but, instead, read over the copious amounts of material given out at a later time.  I’ll buy that.  However, one questions why all-day CLE sessions are even necessary.  Why not just give us all a snippet and tell us to go read the information ourselves?

Here is the thing:  I like learning.  I like expanding my knowledge in a particular area of law. What I don’t like is being dissapointed consistently with dull presentations which go nowhere.  Now, I’m not saying all CLE’s are bad. Some CLE’s I have taken have been very, very good.  Yet, in my experience, those occasions are more the exception than the rule.

Perhaps the answer to this conundrum is for me to stop complaining and come up with an awesome CLE presentation of my own – one that defies all expectations.  I guess I’ll have to get working on that.

I am interested in knowing what other people’s experiences with CLE has been?  Am I jaded, or does everybody have a similar experience?  Feel free to comment.

 

LSAT Test Taker Numbers Continue to Drop

Posted on by
Reply

As reported by the New York Times, the Law School Admission Test (LSAT) is reporting that there has been a 16% drop in the number of LSAT test-takers from the previous year.  That drop represents a decade low according to the Law School Admissions Counsel.

According to the Times:

The Law School Admission Council reported that the LSAT was given 129,925 times in the 2011-12 academic year. That was well off the 155,050 of the year before and far from the peak of 171,514 in the year before that. In all, the number of test takers has fallen by nearly 25 percent in the last two years.

Those are some pretty interesting numbers.

No doubt, the drop in the number of test-takers can be directly tied to the recent recession and the news of student’s suing their law schools for false employment data reporting.

My two cents?  I’m not at all surprised.

My wife asked me the other day if I would talk to one of the children of someone she works with about being a lawyer and going to law school.  The first thing I did was frown and say, “I hope she isn’t another liberal arts major that doesn’t know what else to do with her life.”  (Ok, I’ll admit to being a cynic and rather negative at times.  I’ll also admit that I was that liberal arts major).

However, I was speaking with a local judge in Minnesota recently about practicing law, starting a law practice, and, in general, being a lawyer.  It was a great, lawyer-to-lawyer, conversation.  I don’t have them all the time, but I enjoy the chance to speak with a good lawyer about what the law means to them.

We talked about many things related to practicing law.  The judge had been a solo lawyer for a while, he had been a public defender, and then he became a judge.  He talked about how he enjoyed nearly every aspect of the being a lawyer – no matter in what capacity.  His candor to me was refreshing.

The judge also made a statement that many people ask him “should my son or daughter go to law school?”  After all “isn’t there a lot of competition?”  His response?  If you like the law and you want to be a lawyer, yes, of course, I would recommend law school.

I smiled and nodded.  I don’t know if I would give the same answers to people who ask me if their son or daughter should go to law school.  I hope I would.  However, I knew what the judge meant.

The law is a service profession.  There is much joy in it if you like learning, having an active mind, enjoy competition, and like helping people.  It was the judge’s life work – his ministry, if you will.

So, I am thinking that maybe it isn’t the lawyer part that is bad.  Instead, it is the misconception that I think people have about what law school and being a lawyer means.  People shouldn’t think of it as a means to an end.  The law is the means.

Being a lawyer won’t make you happy if you are in it for the money or prestige or whatever reason you have.  You should only take the LSAT and go to law school if you want to be a lawyer.  If you don’t know what that means, I suggest you go intern a while and figure it out before you make the financial and life-altering leap that is going to law school.

 

Starting a Law Firm | Questions about creating a law firm website

Posted on by
Reply

I’ve posted on the topic of creating a law firm website on several occassions already on this blog.  However, the lawyer website posts continue to be some of the most visited and frequently asked about posts.  So, here is another one!

New Jersey lawyer Jennifer B. Barr Swift sent me an email yesterday and asked for help with her law firm website.  I was more than happy to oblige and try to answer some questions.  I have spent an inordinately large amount of time designing websites and blogs in the past year.  (Probably because I was/am still waiting to be licensed to practice law in in the state I now live in).

Her questions are common to many I have been asked by other lawyers.  I asked permission from her to post her question and my answers.  I hope they help some people who are trying to start a law firm and design their own lawyer website.

I read your blog about starting a law firm web site, which was quite helpful because I am trying to do the same.  I hope you were serious about your offer to lend a hand with creating a web site, because I do have some questions . . . .

I already registered a domain name, but I haven’t chosen a host yet.  I think I’m leaning towards either GoDaddy or iPage, both of which seem to be easy to work with a Word Press theme.

I have chosen (but not purchased) the Elegant Theme Premium Word Press themes, because they do look very nice.

So, what do I need to do to now?  Do I sign up with a host, install the free Word Press software (which I believe is available through the host), then buy the theme?  Am I ready to start editing then, or do I also need the Photoshop software (which is about $300 from what I can tell).  Also, for the Elegant Themes, the price is about $40 per year; if I don’t renew after the year do I lose the theme and thus my web site?

Your web site is very nice – great job!

Below is my response:

Thank you for the email and questions.  I actually love getting these types of questions from other lawyers.  I’ve been amazed at what the blog has done for me in terms of talking with other lawyers throughout the U.S.

. . .

(1) I would choose Hostgator.com for your website hosting.  The plans are flexible and, best of all, affordable.  A year-long plan is something around $67.00 after discounts.  I haven’t found anybody else that cheap.  I used Winhost.com and they were a disaster.  Bad service, bad support. Additionally, since you are asking for my help, I can be more specific on what to do because I know how to use Hostgator’s software and user-interface.  Hostgator installs WordPress very, very easily.  It’s almost as easy as the click of a button.

(2)  I’m assuming you sign up for Hostgator, but I would guess that most of the hosts have compatible software.

(a)  After you pay for the hosting service, they sign you up for a thing called “cPanel”.  cPanel is simply their user interface.

(b)  In cPanel you can go to “QuickInstall” and, from there, click on “install WordPress.”

(c) The hosting service will then install WordPress, give you a password and a user name, and point you towards a log-in screen.  You log in and you now have a WordPress website.  It will look very plain and have the WordPress 2010 theme on it.

(d) Now, go to the WordPress “dashboard” in the upper-left-corner. In the WordPress dashboard you need to locate the area on the left hand side of the dashboard called “Appearance” and, from there “Themes”.  Once you are in themes, you will want to find the button called “upload theme.”

(e) Assuming you can get this far, you now need to purchase a theme.  You said you were going to use Elegant Themes.  Elegant Themes has many different themes to choose from.  Assuming you sign up and pay for the service, you pick a theme and then download the files to your computer.  They will be in a ZIP folder.  Leave them in the ZIP folder and remember where they are on your computer.

(d) Open up you WordPress dashboard again, click upload theme, and find the Elegant Theme ZIP folder on your computer.  Upload it and then click “activate”.  You should now have you own theme and website!

(3)  I don’t know what happens if you stop paying for Elegant Themes.  I don’t think you would lose your website as the files are on your computer.  However, I don’t really know the answer to this question.  If you are nervous about it, I suggest you choose a one-time payment theme option like Thesis, Woo Themes, or Theme Forest.  My two-cents is that $39.00 is so small that it doesn’t really matter.

(4)  Don’t buy photoshop software.  You don’t need it.  If you really want to edit photos, there are plenty of free services.   I use Paint.net and Photoscape.  Both are free and both are great.  There is a learning curve, but it’s free so who cares?  Google either one of those names, find them, and download them.  If you don’t like them you can simply delete them from your computer.  Also, I get most of my images from Stck.xchng.  You have to sign up to use the images, but most of them are free (although you may have to give the photographer credit).  I don’t pay for any images.  But, I should warn you that you can’t just take images off the internet.  You have to use images that have been approved for free use.  If you want to know more about this, please ask.

(5) Designing the website and including content is, obviously, solely at your discretion.  Designing the logo is a bit tough and I’m no expert; however, I think it’s fun.  Adding content is fairly easy as well.  However, every “theme” has its own way of uploading pictures and content.  You’ll have to play with it.

 

Finally, there is a learning curve to all of this.  It takes time.  I’ve screwed it all up enough times that I know how to make it work.  If you want specific help with anything, please ask.  I enjoy this stuff.

Good luck.

I hope that helps answers questions people may have.  As I’ve stated, I’m no expert and all of this takes time.  However, building your own website is not that difficult.

For anyone who is interested, you can find my website at www.flanderslawfirm.com.

If others have questions or would simply like some help, please email me at jflanders@flanderslawfirm.com.  Seriously, I’ll email you back.

 

 

Starting a Law Firm | The Law School Bubble

Posted on by
2

I recently began receiving the ABA Journal as a card carrying member of the ABA.  I find this mildly amusing given that I didn’t begin receiving anything from the ABA – outside of CLE advertisements – until I started my own law practice.  If I get one thing out of being a solo lawyer, at least the ABA thinks I’m worthy of receiving a free copy of their magazine.

In the March, 2012 issue, the journal had some very interesting letters to the editor.  The letters were in regard to the so-called “law school bubble.”  For those who don’t know, the law school bubble refers to the notion that there are too many law school, too many lawyers, and too high tuition.  In essence, the argument that is taking place goes something like this:  because there are not enough lawyer jobs, law schools who charge high tuition are not creating a viable return on investment for the students attending the schools.

One letter in particular really grabbed my attention:

The ABA is a major contributing cause to the continually shrinking job market for attorneys.  It makes me sick every time I read that there has been a new admission of 300 attorneys in Kentucky in the past six months.  Not only is there no place for these new attorneys to work but the are driving down the salaries of more experienced attorneys who have to compete with them . . .

Good points, all.  However, I wonder, is it true that law school tuition has raised at such an exorbitant rate in comparison to national salaries, or is the recent recession to blame?

So I did a little research. Check out law school tuition statistics from 1985 to 2009 at private and public law schools as reported by the ABA. If you look at the statistics (and, no, I am not vouching for the source) the raise in tuition appears to be steady from a year-to-year basis for both public and private law schools.

In fact, since the recession began in or around 2007, private and public law school tuition has not risen significantly in terms of percentage from the previous year.  From the ABA’s date, it would appear that law school administrators are in fact aware of the recession and are considering tuition increases appropriately.

Now, you can certainly argue that just because tuition is not being raised doesn’t mean that there is no “law school bubble”.  However, it doesn’t appear that law schools have been entirely blind to the recession and the problems that it has created for law school graduates.

Students also have the opportunity to do a little research of their own before deciding whether their investment in law school is going to be a good decision for them.  Employment statistics are out there for people willing to look.  However, at lot has been made out of the fact that some law schools have allegedly skewed their post-graduation employment data.  Heck, even Congress is looking into it.  It is a big deal:

The ABA Section of Legal Education and Admissions to the Bar has also been criticized for releasing post-law school statistics that are vague in terms of whether or not the employment is in the legal field, or if it is full or part-time. The ABA Section alleges that their future statistics will be more precise.

I will be the first to recognize that the allegations are alarming.  I would also like to be the first to posit:  maybe it’s not the law school, but, instead, society’s misconception about the value of a law degree?  Lying about employment statistics is one thing, failing to be aware of real job prospects is another.

I chose to go to a law school (University of North Dakota School of Law) that didn’t charge high tuition and who wasn’t hiding the fact that the legal job market wasn’t so good when I graduated.  Oddly, UND is not a “tier 1″ law school according to the US News.   I didn’t pay a lot and I made a good salary when I graduated.  I felt like the investment was a good one.  My employers did not care at all where I went to law school – they looked at my grades, my employment record, and other standard “getting a job” related information.

My point here is that I made a choice to go to a less “prestigious” law school that charged a reasonable tuition.  The “ranking” of my law school has absolutely no affect on when I received a job and how much I was paid.  My employers didn’t care.  Why?  I would argue that it was because where I graduated from wasn’t important.  What was important is the person I was and my attitude about being a good lawyer.

In sum, I would argue that the recession has created a lot of problems for all kinds of people in all kinds of professions.  Lawyers are not alone in this.  I don’t feel sorry for myself that I’m a lawyer in a bad job market, instead, I do what I did in law school – I put my nose to the grindstone and start being proactive.  I certainly don’t blame the ABA or the law school system writ large when things go badly for me.