Dreaming of leaving your firm to practice law on your own can be an anxiety provoking endeavor. According to Raymond Hekmat, it doesn't need to be. He recently left his firm practicing family law, to start his own practice, Hekmat Law & Mediation. Reflecting on this journey, he has 4 tips to share with others on how to make the transition successful.
1. Get your cash flow in order
"Fear around the unpredictability of income and your gap in income is completely normal," says Hekmat. The first step to tackling this fear is to ensure you shift your mindset from thinking that you won't be making any money for a period of time to understanding that you will need an investment of money to cover your costs of living for a period of 4 to 6 months. "Cutting back personal expenses during this time and looking at your expenses as an investment in your future practice is what will allow you to have the freedom to focus on the future of your company and the kind of valuable service you want to provide."
If your monthly personal expenses are $5,000, for example, save between $20,000 to $30,000. This will allow you to invest time into the future of your company without worrying about your personal expenses. You can consider this lump sum an investment into your future company in addition to the hard costs you will have to spend setting up your practice.
Cut your costs back as much as possible. See what areas of your life you can shift around to bring your monthly costs down a bit and spend more time focusing on how you will provide positive value to your clients and what your referral sources will be.
"Safety nets are dangerous," Hekmat adds. "When a tight rope walker has a safety net or a lifeline, they fall more often than when they do not have any nets or lifelines. Feeling unsafe is one variable of a healthy environment for your startup to propel towards success. Don't let the feeling intimidate you."
Keep your overhead as low as possible in the beginning until you have a healthy cash flow coming in. Work from home or use executive suites and don't spend too much money on areas of your business that won't provide value to your clients.
2. Start setting up your company before you leave your firm
Do your due diligence in advance. What will you need? Perhaps a website, a business entity, a phone number, and relationships with vendors. Start setting these aspects of your company up before you leave your firm. Many of these tasks, including setting up a business entity, take time. Doing it in advance will allow you to hit the ground running when you leave your firm.
Also, learn how to run your practice on your own. "Before you leave the firm, talk to office staff to familiarize yourself with what you will specifically need in your own practice that you might be taking for granted working for a well run operation," says Hekmat. "It's important to have a thorough understanding of your future operation before you leave your firm." You want to be able to design an operation that works well for you. Take what you like about your current firm and innovate in areas that you think you can do a better job with your new practice.
3. Build good relationships
A lot of people spend time interacting with other attorneys, vendors and professionals during their time at their firm not realizing that even though they are representing their firm, they are also representing themselves. These relationships will have an impact on your future whether you are practicing law on your own or at a firm.
Building relationships around trust, professionalism, good worth ethic and reliability will keep you top of mind. "When you are at a firm you will have opportunities to build relationships with referral sources, and so building a connection that will keep you top of mind will be your stepping stone to starting off on the right foot when you start your own practice."
The relationships you build with other attorneys can be beneficial as well. Attorneys in your network may pass on workflow to you when they are unavailable. This can become supplemental income and a potential referral source.
"Leave on good terms before you start resenting those around you at work. When you start resenting your work environment, you will start to soil relationships. You do not need to wait to feel resentful in order to develop the confidence to leave," says Hekmat.
Maintaining a good relationship with the firm you are leaving will also be a great referral source for your future solo practice.
4. Develop a reference list and document template file
While you're at the firm, start making document templates for yourself of cheat sheets on cases, keeping note on the kind of cases you've handled and the work that you've done so you can have a reference book for yourself.
This will help speed up your process in the beginning so you do not need to re-create everything from scratch.
On an end note, remember not to solicit clients of your existing firm. Know that if you have built strong relationships and create value for your clients through your services, clients will want to come to you. Be prepared to win by setting yourself up for success.