Has Anyone Left a Partnership to Start a Firm

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Has Anyone Left a Partnership to Start a Firm

Postby Anonymous User » Mon Apr 17, 2017 3:29 pm

Ok, the average age of TLS seems to be older now than it used to be. Has anyone left a firm after making partner to open up a new firm? In my case, leaving a small partnership to open up my own firm. I'm bringing one secretary (neither of us signed non-competes) and am considering poaching another, and bringing all or nearly all of my client base (with a few disputes). I'm considering hiring one associate this summer.

There are a lot of things to work through, but before jumping in headfirst on this thread, I'm just curious if anyone else has done it. There is significant overlap in the process with anyone who has hung a shingle, but there are considerable differences as well (sufficiency of start-up capital, disputes about rights to certain case files, accounting for my share of the firm's current equity, certain PR-related issues regarding the split, poaching etc.)

misterjames

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Re: Has Anyone Left a Partnership to Start a Firm

Postby misterjames » Mon Apr 17, 2017 11:52 pm

I think you're overestimating the age of this forum, maybe give JDU a try?

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AVBucks4239

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Re: Has Anyone Left a Partnership to Start a Firm

Postby AVBucks4239 » Tue Apr 18, 2017 9:13 am

I've given opening up my own firm a lot of thought, but have not pulled the trigger quite yet.

Some good references would be "How to Start and Build a Law Practice" and "Solo By Choice."

Seemingly unanimous advice from those books, as well as other practitioners in my area, is to avoid too much overhead to start. I know one lawyer who has a secretary, paralegal, and a nice office, but he told me he needs about $8,000 per month just to cover expenses. This means he needs about $12,000 per month in receipts just to make $50k per year.

I also know another attorney who has about $700 per month overhead. He does not have a secretary or paralegal, he office shares, he uses his wife's health insurance, and he uses the local bar association's Westlaw subscription. He only needs $5,000 in receipts per month to make $50,000 per year. I'm 90% sure he nets more than the above attorney.

Thus, at least to start out, I would strongly recommend business model #2. Get your feet on the ground, get your receipts in the door, and then weigh whether or not you can afford an associate.

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Re: Has Anyone Left a Partnership to Start a Firm

Postby Anonymous User » Tue Apr 18, 2017 9:18 am

I've seen a partner get forced out and forced to start their own firm. But I don't think that's a role model you want to emulate.

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PeanutsNJam

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Re: Has Anyone Left a Partnership to Start a Firm

Postby PeanutsNJam » Tue Apr 18, 2017 11:54 am

AVBucks4239 wrote:I've given opening up my own firm a lot of thought, but have not pulled the trigger quite yet.

Some good references would be "How to Start and Build a Law Practice" and "Solo By Choice."

Seemingly unanimous advice from those books, as well as other practitioners in my area, is to avoid too much overhead to start. I know one lawyer who has a secretary, paralegal, and a nice office, but he told me he needs about $8,000 per month just to cover expenses. This means he needs about $12,000 per month in receipts just to make $50k per year.

I also know another attorney who has about $700 per month overhead. He does not have a secretary or paralegal, he office shares, he uses his wife's health insurance, and he uses the local bar association's Westlaw subscription. He only needs $5,000 in receipts per month to make $50,000 per year. I'm 90% sure he nets more than the above attorney.

Thus, at least to start out, I would strongly recommend business model #2. Get your feet on the ground, get your receipts in the door, and then weigh whether or not you can afford an associate.


I don't think those sources seem applicable...? The OP said he has a client base already with substantial start-up capital. He/she probably wouldn't struggle to rake way more than 12k/month receipts.

To address the OP, I don't think there is anyone on this forum other than the V15 partner who could help, and I don't think he has any experience leaving a firm and starting up his own shop so idk if he can actually help.

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Re: Has Anyone Left a Partnership to Start a Firm

Postby Anonymous User » Tue Apr 18, 2017 12:12 pm

Know someone who did this in a specialized field (employment/non-compete counseling and litigation) and he has no regrets. He will tell you that the reason he did it was comparing his collections to his compensation at his old firm and concluding that he wanted a bigger piece of what he brought in and personally billed.

Being a talented and locally well-respected specialist helped, having a preternatural ability for networking and hustling helped, and having a father who was a "dean of the bar" type figure in his mid-sized city helped, and having a wife who could pitch in for free or close-to-free as a legal assistant/secretary in the early years helped. Not saying all of those are necessary, but I mention them just so you know the kinds of things you need to build your own practice.

Count on a couple of lean years to start, but recognize that you have to stoke the fire before it's going to start roaring on its own.

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AVBucks4239

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Re: Has Anyone Left a Partnership to Start a Firm

Postby AVBucks4239 » Tue Apr 18, 2017 12:49 pm

PeanutsNJam wrote:
AVBucks4239 wrote:I've given opening up my own firm a lot of thought, but have not pulled the trigger quite yet.

Some good references would be "How to Start and Build a Law Practice" and "Solo By Choice."

Seemingly unanimous advice from those books, as well as other practitioners in my area, is to avoid too much overhead to start. I know one lawyer who has a secretary, paralegal, and a nice office, but he told me he needs about $8,000 per month just to cover expenses. This means he needs about $12,000 per month in receipts just to make $50k per year.

I also know another attorney who has about $700 per month overhead. He does not have a secretary or paralegal, he office shares, he uses his wife's health insurance, and he uses the local bar association's Westlaw subscription. He only needs $5,000 in receipts per month to make $50,000 per year. I'm 90% sure he nets more than the above attorney.

Thus, at least to start out, I would strongly recommend business model #2. Get your feet on the ground, get your receipts in the door, and then weigh whether or not you can afford an associate.


I don't think those sources seem applicable...? The OP said he has a client base already with substantial start-up capital. He/she probably wouldn't struggle to rake way more than 12k/month receipts.

To address the OP, I don't think there is anyone on this forum other than the V15 partner who could help, and I don't think he has any experience leaving a firm and starting up his own shop so idk if he can actually help.


OP said nothing about the size of his client base.



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