Hire Lawyers, Not Law Firms in 2013

Clients hire lawyers, not law firms.  This is demonstrated repeatedly by clients who follow their attorneys from Firm A to Firm B.  It also explains one of the main reasons why Firm B lures attorneys from Firm A: for their clients. (If you prefer watching to reading, I make my case in this fun 3-minute video).

Historically, big, full-service law firms have commanded premium rates because (1) they recruited top-flight lawyers from the best law schools, and (2) they offered nearly every practice area under the sun.  (1) + (2) = premium brand, which means more expensive, which implies better.  This rationale has led many corporate clients to pay the Gold Standard law firm $250,000 to lose the same case that the Silver Standard law firm would have lost for half the price.

Well, the Great Recession has made us wiser judges of value.  As that 3-minute video reveals, the big, Gold Standard law firms lost about 10,000 lawyers between 2008 and 2010, alone.  But, those displaced attorneys didn't sulk for long.  While some were grabbed by other law firms, many have banded together to form small, highly specialized law firms that I call microboutiques. Those enterprising  attorneys now charge hundreds of dollars per hour less than they did at the Gold Standard law firms, and many of their clients have followed them to their new practices.  In fact, I recently spoke with a former big-firm partner who launched a microboutique in Silicon Valley.  His hourly rate has dropped by $300 per hour, and he's staying busy serving high-end corporate clients.

Make a resolution in 2013 to test-drive different attorneys.  Look for the ones with big firm and in-house experience who've opened their own small boutiques.  You may be pleasantly surprised by the experience.

The Future of Full-Service Law Firms

Most legal matters are local and only require one or two attorneys.  Yes, big law firms will always be essential for some bet-the-company and multi-district matters.  And, yes the largest corporate legal departments will continue to leverage their volume into affordable rates at the one-stop firms.

However, most business and corporate clients have little reason to pay full-menu prices when equally good lawyers can be found a la carte at small specialty firms that charge less and, arguably, work harder for their business.  The case for these "microboutiques" grows daily as more and more of them are being started by former big-firm lawyers.  We make that case in this 4-minute video.

If you hire lawyers for your company, we'd like to know what you think.

Why I Started This Blog

There are many blogs for lawyers but few for their business and corporate clients.  I am moving into this space in order to stimulate and champion the emerging buyers' market for corporate legal services.  This blog is for family-owned companies, C-level executives and in-house attorneys, all of whom I invite to join this movement.

Many of our discussions will flow from the Association of Corporate Counsel's ambitious Value Challenge initiative, launched in 2008.  Their goal is to "reconnect the value and cost of legal services", and ACC has made great strides in that campaign.  I participated in their early workshops and chronicled their progress through annual roundtables that I produced for a legal media company in San Francisco.  Much of what I learned through that work was incorporated into a proprietary poll that measures attorney performance.  The metrics from that poll will serve as topics in this blog.

You can learn more about me here and about my company here.

If you hire attorneys for your company, I invite you to subscribe to this blog and to actively share your experiences with the rest of us.

Many thanks.