Has there ever been a better time to start up a law firm?
The thought of setting up a new law firm during a global pandemic may seem irrational, cavalier and high risk.
However, in such a world-changing event, as with any global crisis, the winners will be those who adapt the quickest and realise the change rather than resist it. To paraphrase Charles Darwin, it is not the strongest of the species that survive, but rather, that which is most adaptable to change.
The motivation of most lawyers, whether they entered the profession to help others, for the career opportunities, intellectual challenges or for financial reward, is generally to become a partner and ultimately run their own firm. In recent months, given the current state of the world, I have seen practitioners weighing up their options, making initial enquiries and starting to think about what running their own legal practice would entail. Here is some advice about starting up.
Time to plan and prepare your venture
As with any business plan you need a strategy, and this requires thinking time. Social distancing and isolation has given us time to think existentially about our current circumstances and priorities.
With social restrictions of some shape or form in place for the foreseeable future, whether you are working from home, saving time on commuting, or not working at all, many of us have much more time at our disposal.
There has never been a better time to implement or speed up your life plan. The heavy lifting such as SRA applications, researching the right PI cover and sourcing the best technology to ensure that your business is fully digital from the beginning can all be established and put in place.
Favourable market conditions
This may seem strange with so much economic activity in lockdown at present, but the reality is that setting up a law firm has never been more affordable.
Interest rates on loans have never been lower and as we progress through this pandemic it would be fair to surmise that more government assistance and stimuli for start-up businesses may materialise.
The question of demand is of course key when it comes to opening your doors for business. Small to medium sized law firms are reliant on an active and busy society. The drop in recent activity caused by the pandemic is creating a swell of demand that we have not experienced before and more legal service will be consumed across a variety of work types as a clean-up begins.
Many firms will have lost staff and will be running at limited capacity, unable to service the needs of their existing client base let alone take on new enquiries. These consumers will look elsewhere for the services of alternative providers. It is new agile law firms powered by digital technology which will be best positioned to attract and retain such consumers.
Society needs lawyers more than ever. As we come out of the pandemic law firms must be able to react to, look after and nurture their clients digitally. It is what the client will demand.
Legal Talent Transfer Window
Attracting the best legal talent has always been a challenge, but the pandemic has created a window of opportunity with redundancies, lay-offs and short-term working likely to take place over the next six months. There has never been a more diverse, highly skilled pool of legal talent currently pondering their current circumstances and waiting for the right opportunity or partnership.
Surrounding yourself with the right people and the right business and legal expertise and choosing the right mix of lawyers who can practice in the growth areas will be key to success.
A Change in Culture
One of the biggest and most documented changes which the pandemic has driven is the switch to remote working and the acceptance of working from home.
Consumers no longer question conducting video meetings with their service provider and many may well actually prefer this to visiting offices.
The requirement of opening an office to launch your law firm is no longer a necessity and a client will no longer associate this as part of the value proposition for your firm.
Geography does not exist in the virtual world so attracting clients from further afield will be easier. Using the likes of Zoom & Microsoft Teams is becoming second nature to most, making communication and collaboration with clients and colleagues alike much simpler.
There is a new wave of smart start-up firms appearing, embracing innovation such as video calling, online digital payments, document sharing, e-signatures and document bundling solutions. It is this digital engagement that prospective clients will see as essential when choosing who to place future business with. and they market their firm on that basis.
The first item on any new law firm’s shopping list has changed dramatically in recent years and whereas it used to be the office lease, printing and copying machines or precedent guides, it is now, unquestionably in my experience, a case management and accounting system (CMS). The data held within the system ultimately represents the firm’s most valuable assets. As well as a sophisticated CMS, technology-wise, all you really need to start your law firm is a good laptop, a subscription to Office 365 and access to the internet.
With the right practice management solution new lawyers can digitise all client matter communications, capture time and activities, share and collaborate on documents, bill and invoice in a few simple steps and perform SRA compliant accounting, and more — all for the monthly cost of a romantic meal for two!
Adversity brings opportunity
The pandemic has turned the legal service landscape upside down with larger, more established businesses finding it harder to adapt to the new requirements of both their workforce and their clients.
Often great things are formed in adversity and no matter how new they are, smaller, more agile businesses can react, adjust quickly and adapt to meet the requirements of a changing environment. With affordable, highly effective technology available to them, they can scale their firms to meet demand and best position themselves to profit through the unpredictability of the next few years.
Many of the barriers to entry in the legal industry have been blown aside. There has never been a better time to start a law firm.
LEAP has a heritage of supporting entrepreneurial lawyers and new start-up businesses throughout their journey and for one subscription provide start-up firms with everything they need to run a successful law firm.
Download our start a law firm guide to begin your journey today. Visit www.leap.co.uk/get-started