Wisconsin Lawyer: Managing Risk Going It Alone: Overcoming the Fear and Finding Success:

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    Managing Risk
    Going It Alone: Overcoming the Fear and Finding Success

    Starting a new business is never fear-free, but learning about the risks and acting to minimize them will leave you well placed to succeed in a solo practice.

    Thomas J. Watson

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    “If you want to conquer fear, don’t sit home and think about it. Go out and get busy.” – Dale Carnegie

    Many lawyers in recent years have decided to take on the challenge of opening their own law office. Hanging out your own shingle can have its rewards, no doubt. But it also has risks and challenges. The questions that typically run through the mind of the intrepid lawyer willing to take the plunge are:

    • Where should I locate?
    • Should I lease office space?
    • What kind of technology do I need?
    • Do I need start-up money? What about a business plan and a budget?
    • How do I attract clients?

    Of course, there are more, but these certainly are enough to give any lawyer enough to think about.

    Recently, I attended a one-day program in Waukesha titled, “Considerations for Starting a Law Practice.” The Saturday event, put on by the State Bar’s Solo and Small Firm and General Practice Section, attracted a conference room full of lawyers.

    Many of them were not new law school graduates but established lawyers looking for ways to make a solo practice work. It was certainly an indication of what is happening “in the trenches.”

    Thomas J. Watsoncom Tom.Watson wilmic Thomas J. Watson, Marquette 2002, is senior vice president and director of communications at Wisconsin Lawyers Mutual Insurance Co., Madison.

    Sally Anderson, vice president – claims at Wisconsin Lawyers Mutual Insurance Co. (WILMIC), was one of the program’s speakers. She says typically lawyers are used to being the problem solvers. “Asking for help is not something that comes easily to them. But help is plentiful, and if they have a problem, they should not be afraid to get some guidance.”

    That guidance, Anderson says, can come from other lawyers, the State Bar, mentoring programs, the lawyer-to-lawyer directory, or even your malpractice-insurance carrier.

    Who’s Taking the Plunge

    Joe McCarthy, vice president – underwriting at WILMIC, says the lawyers turning to WILMIC for insurance are coming from many different career positions. “An equal number of our new lawyers are coming to us with several years of practice experience breaking away from their current firms, or have just graduated from or been out of law school for a short period of time. So we’re seeing it from both ends of the spectrum.”

    McCarthy says smaller numbers of lawyers wanting to open their own practices are coming from governmental positions or are from out of state.

    Getting Your Practice Off the Ground

    Often, one of the more intimidating parts of opening your own law office is figuring out how to do the things you didn’t learn about in law school: a business model, a budget, payroll taxes, accounting, and hiring staff (or not).

    Another challenge is making sure you have enough business and being able to attract new clients to sustain a long-term practice. Madison solo practitioner Zeshan Usman was another of the Waukesha seminar speakers. He says fear is one of the biggest motivating factors, but also one of the things that keeps lawyers from taking that big step.

    Fear is one of the biggest motivating factors, but also one of the things that keeps lawyers from taking that big step.

    “Fear is a very normal human feeling. I felt it when I first decided to open my own practice. You’re stressed and nervous. You think to yourself, ‘Can I really do this? Is this the right decision?’ It’s a fear of the unknown. Part of it is because you are not fully prepared, or at least, you don’t feel like you are. That adds to the stress.  The better prepared you are, the less stress you’ll feel.”

    But Usman says fear, or stress, can also be the motivator you need. “Use fear to figure out what to do. Map out ideas – how to budget, how to get clients, your backup plans in case this doesn’t work out. The more you do that, the less stress you have. I always tell other lawyers it’s like having kids. You’re never really prepared for that. If you wait for the perfect time to have children, you’d never do it. The same thing applies to opening your own law practice.”

    At the Waukesha seminar, Usman provided the audience with a list of five common fears before starting a law practice and their solutions. (Please see the accompanying chart, “Five Fears (and Solutions) Before Starting a Law Practice.”)

    Getting (and Keeping) Clients

    Successfully attracting good clients includes developing habits that give good clients a reason to keep using your services and recommending you to other people. So how do you attract more clients? Volunteering and developing contacts is a start. You may consider getting involved with a volunteer lawyers program in your town, attending CLE programs where you can network with other lawyers, joining local and specialty bar groups, and volunteering to be involved in every activity relevant to your desired practice area.

    Good client selection is also part of the process. Taking every potential client who walks through your door will only lead to frustration, discontent, and possible client complaints. It can sometimes lead to practicing in areas of law in which you have little or no expertise.

    But many lawyers starting a practice cannot afford to turn away too many clients. That’s where mentoring comes in. Find a mentor by networking, or find two or three seasoned practitioners. Use the State Bar’s Lawyer-to-Lawyer Directory (available on WisBar.org and in the print Wisconsin Lawyer Directory). Keep talking to your law school classmates and listen to what they say.

    Good client relationships can also make a difference, not only in the quality of your representation of the particular client but also by leading to referrals for other potential clients. Usman says, “I don’t have a single client I have not met face-to-face. Some people say, ‘Can we just do this over the phone?’ I say no. I need to meet them face-to-face. It’s better to have that relationship. For the long term, I need to create relationships. Client selection is important and getting to know my clients is one way to help in that process. Clients are sometimes not apt to tell the complete truth. They are more likely to be completely honest when they are meeting me face-to-face. Plus, we then develop that relationship that helps me be a better lawyer and provide them with better service.”

    Anderson also warns about client selection. “You aren’t the right lawyer for everyone who walks through your door. Be selective. Taking every client can lead to practicing in areas of law in which you may have little or no expertise. That can be a recipe for trouble.” Learning a new area of law is possible if you have the time and resources to appropriately serve the client’s needs. Can you fulfill this client’s expectations reasonably? A good mentor is invaluable when a lawyer is looking to expand into new areas.

    Technology

    Some lawyers argue that solo practitioners have never had a better chance to succeed than now, because of the proliferation, thanks to technology, of inexpensive, innovative, and reliable resources. It is no surprise that many lawyers and law school graduates today are tech savvy. Usman, like other innovative lawyers, continually considers how technology can work for him. “I think basic technology for the lawyer starting his or her own practice is important and essential.”

    Usman says, “In this day and age you aren’t tied to a bricks-and-mortar office. I can outsource tasks to a virtual paralegal, I can use cloud-based client management tools, including billing, and I can manage my workflow from anywhere, even when I’m not in my office.”

    Usman also says he saves on overhead costs. “I have a virtual phone system that can answer or forward client calls. It sends my messages and voicemails directly to my smartphone via email and text.”

    Of course, Usman says, there is still no substitute for looking the client in the eye and delivering the services he or she needs. “You can use technology to your benefit, but don’t forget about the client. In the end, the connection you make with them can make all the difference.”

    Insurance

    Another consideration for lawyers opening their own law practice is insurance, specifically malpractice insurance. McCarthy says, “I spend a lot of time explaining, in general terms, how malpractice insurance works. Most new attorneys have never dealt with a claims-made policy. I explain that under a claims-made policy, they have to have an active policy in place at the time they become aware of a potential claim and they must report it during that policy period. Most are surprised at how affordable initial premiums are.”

    Conclusion

    At the very least, when thinking about starting a law practice, consider the following:

    • A business plan, with financial goals and objectives
    • Technology needs for your office (and out of the office)
    • Client selection, fees, and billing procedures
    • Attracting clients (marketing your practice and networking)
    • Backup plans in the event you are temporarily disabled or cannot work

    Considering these issues can be a good foundation that can lead to future success. With attention to detail and a little help from the right sources, launching and operating a successful law practice can be done.

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