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Month: June 2024

Running a ‘Lean & Mean’ Boutique Law Firm

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“I walked away from my law career to save my health.” This is how Jamie Sign, an attorney in California, titled her article. The post has more than a hundred likes and comments from other lawyers empathizing with her struggles working with “Big Law.”

The reality is that mental health is becoming a top priority for lawyers of all ages. Sacrificing everything at the altar of success is no longer the only narrative that’s available for attorneys. Today, new voices for sustainable work-life balance are rising.

 

Revenue Is Vanity, Profit Is Sanity

As a law firm owner, you may find yourself in a tricky situation where your firm wants to grow but doesn’t want to deal with more complexity. In the beginning, it may have been just you and a couple of friends, but as you expanded the team, the expenses started to pile up. Now, you have more mouths to feed, and the pressure of bringing in new business and expanding the business can accumulate like a pressure cooker.

 

At that point, you may find yourself making more revenue but receiving less actual-cash-in-hand at the end of each month. Making less profit while stressing more is hard enough to discourage even the most enthusiastic lawyers, and that’s when the question pops up:

Should I go back to when my law firm was a simpler business, I was making good money, and we had a small but might team?

For some, the answer is definitely yes. Attorneys like Jamie Rubin (who we interviewed in The 1958 Lawyer Podcast) intentionally decided to stay “lean & mean.” He runs a boutique law firm in a niche market, where they can focus on doing great work for a handful of clients.

 

The question is, what if you still want to grow your law firm but do it in a way that’s profitable and keeps you sane?

Finding Your Sweet Spot for Profitable Growth

Venture-backed companies have popularized the notion of scaling, and it has become the promised land for many companies. But for bootstrapped companies, a healthier, more realistic notion is that of sustainable growth.

 

Each organization needs to find its sweet spot between growth and profitability. In periods of high growth, it’s okay to invest heavily in new team members, software, advertising, and infrastructure. But there are also periods of retaining clients, improving systems, and streamlining costs, which are essential to maintaining a healthy balance.

 

At Amata, we want to make this balancing act easier with our Fractional Support Services. With them, you can hire paralegals, virtual assistants, and legal support staff on an hourly basis. Our pre-made packages can save you up to 60% compared to a full-time employee, and also save you time on recruiting new employees.

With the right setup, you can generate a healthy profit margin while still having steady growth and room to hire and delegate. Your core team can be composed of only the full-time hires that you are essential to your firm, like the owner and associates. Your fractional team can be composed of paralegals, virtual assistants, and on-site admin staff.

 

Whether you expand or contract, your fractional team can adjust and protect your profitability. We even have a pay-as-you-need-it model when none of our pre-made packages suit your needs.

 

In this way, you can run a profitable ‘lean & mean’ law firm that allows you and your employees to enjoy a healthy work-life balance with steady growth.

Interested in learning how our Fractional Support Services can get you there? Contact our team here and we’ll answer any questions for you.

Building A Lean, High-Quality Legal Team

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In 2023 Aaron Hall did a study of some of the highest hourly rates in the legal world:

  • $2,465 per hour was charged by Neal Katyal of Hogan Lovells according to Reuters.
  • $1,965 per hour per hour was charged by attorney Bryce Friedman of Simpson Thacher & Bartlett according to Bloomberg.
  • $1,950 per hour was charged by David Boies of Boies Schiller Flexner LLP according to Reuters.
  • $1,230 per hour per hour was charged by attorney Dirk Vandermeersch of Cleary Gottlieb in Brussels according to Lawyers Mutual.
  • $1,220 per hour was charged by tax attorney Ian Taplin of Kirkland & Ellis according to Lawyers Mutual.

And while some of these rates might seem outrageous (or aspirational, depending on how you look at them), the reality is that running a law firm has become more expensive. From office costs to social benefits and costly talent, it has become more difficult to run a highly profitable law firm without increasing rates for the end user.

 

However, there’s a limit to raising prices. Most law firms need to approach this problem in three ways:

a) Attracting well-capitalized clients who can afford higher rates

b) Focusing on solving bigger, more expensive problems

c) Lowering their expenses without compromising quality

 

That is why today’s article talks about the true cost of in-house support and how Amata’s on-demand services save lawyers money.

 

The True Cost of In-House Support

Office and team are the two biggest expenses law firms incur (besides taxes, of course). Previous articles covered how our flexible office plans save law firms money on office space, providing them wiggle room to scale. Now we have a new service that can save you money on your team-building efforts: Our new Fractional Services Packages.

Because let’s be real: Hiring people today is expenses. How expensive? Here’s a breakdown of 2024 rates in an established market like Chicago:

Associate Attorneys

The National Association for Law Placement (NALP) found that the overall median first-year associate base salary as of January 1, 2023, was $200,000, up to $35,000 from 2021, when the survey was last administered. This means a 21.2% increase in salaries in just two years, raising the bar for solo attorneys and small firms to be able to afford hiring.

Law Clerk’s blog also found that, in general, freelance lawyers are paid about 30-40% of the market hourly rate. This means that if the median salary for lawyers is $135,740 (According to the Bureau of Labor Statistics), the average hourly rate is $65,26 per hour and for contract lawyers it would be $85-$120+ per hour.

 

 

Paralegals

According to the Bureau of Labor Statistics, the 2022 median pay for paralegals and legal assistants was $59,200 per year and $28.46 per hour. A closer look shows that in states like Illinois, an experienced paralegal can charge an average of $96,030 per year.

 

Executive Assistants

According to Indeed, the average salary for an executive assistant in the US can range from $64,986 on average to $103,983 on the high end.

 

 

Besides the high rates, there is an unspoken cost of building a team yourself: Time.

Posting on job sites, vetting applicants, interviewing them, training, onboarding, and then managing talent takes a lot of time. That is another benefit of our “curated-for-you” Fractional Support Services.

If you would like to build a lean, high-quality legal team, contact us to see how we can supply talent at rates you can afford, at just the hours that you need.

Is “Fractional Hiring” Here to Stay for Law Firms?

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In 1872, there were only 15 law firms with 4 or more lawyers in the US. By 1903, that number had grown to 210, and in 1924 it had grown to over 1,000 (Source). There used to be a time when most lawyers would work in-house in big corporations with rigid schedules. Then, in the 50s and 60s, law firms experienced what’s known as the “Golden Era”. Corporations grew rapidly and demanded lawyers to work inside firms, so they could serve several clients while managing their schedule.

 

Thus, the “Fractional Lawyer” was born. Working part-time, on-demand hours became the norm, and the fixed salaries were replaced with the billable hours and “per project” billing system.

 

This trend of fractionalizing workers has expanded to many other professions since. Today there are Fractional CFOs, CMOs, CTOs, and even CEOs. Businesses benefit because they can hire highly qualified talent without a full-time salary, and workers have more freedom over their hours, workload, rates, and professional future.

 

Here are Amata we are pioneering a new frontier in the history of Fractionalizing: Fractional Support Services for Law Firms, served as a “complete but on-demand” package. Here’s what that means.

 

 

Most solo practitioners and small law firms do not need a full-time receptionist, full-time assistant, or paralegal. Tight budgets and a fluctuation workload mean they need extra support in their business on-demand. What if there was a simple way to tap into this support?

Our new Fractional Support Service Programs allow you to do that. They include five packages plus pay-as-you-need-it pricing options. Here’s a detailed breakdown of how they work:

 

Fractional Support Service Programs

  1. 30 hours/month of Executive Virtual Assistant service and in-person administrative assistance. This is an 80%/20% program, where up to 20% or 6 hours of time each month may be allotted to an in-person administrator for court runs, courtesy copies to judges, trips to the clerk’s office and the vital records office. It may also be used for copy work or any other task an administrator can perform.
  2. 15 hours/month of Executive Virtual Assistant service. This program is 100% Virtual Executive Assistant service, including email management, appointment setting, social media management, and event scheduling, and any other task a Virtual Executive Assistant may perform
  3. 15 hours/month of On-site Admin Support. This program includes court runs, trips to the clerk’s office or Vital Records, copying, scanning, mail preparation, and all other admin support services available at Amata. 
  4. 10 hours/month of paralegal support. This service may include document drafting, document review projects, case management, and any other task a paralegal may perform.
  5. 18 hours/month of paralegal support. This service may include document drafting, document review projects, case management, and any other task a paralegal may perform.

These programs will auto-renew each month until canceled and must be purchased and paid for prior to work being performed. Any unused hours expire at the end of the month and do not roll over into the next month. All monthly overages will be invoiced at the pay-as-you-need-it rates.

 

“Amata makes the transition from large law firm to solo practitioner virtually effortless. Secretarial and paralegal services are available at competitive rates on an ‘as needed, pay-as-you-go’ basis which is ideal for the solo practitioner or small law firm.”

Paula Kaplan Berger BERGER LAW, LLC

 

We believe fractional hiring is here to stay for law firms. Most workers want flexibility in their calendars and most businesses want to pay for only the hours that they need. This setup meets the needs of both, allowing you to grow your law firm while delegating day-to-day admin tasks (at rates you can afford).

If you would like to know the cost of our Fractional Services Packages, click here to contact our team.

Your Employees Are Not Working 8 Hours A Day

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Recently International Workers’ Day was celebrated across the world, but not in the US. While in Europe, Asia, and Latin America, workers’ day is celebrated (on May 1st), labor day is celebrated in the US (on the first Monday of September).

 

The differences are immense. One celebrates the person, and the other the activity. Without getting into any political or moral discussions, this highlights the culture of glorified work that exists today in the US.

 

The eight-hour workday was created during the Industrial Revolution, after factory workers started to riot against 10-16-hour workdays in Chicago. The day was divided into “eight hours labor, eight hours recreation, eight hours rest.”

But this eight-hour moment didn’t become mainstream until in 1914, Ford Motor Company decided to cut the daily hours down to eight while doubling wages for workers. To everyone’s surprise, this increased productivity.

 

Today, a new movement arises: Should we cut the eight-hour, five-day-per-week work schedules even further? With the advances in technology, is working all these hours even necessary?

 

Your Employees Aren’t Probably Working As Much As You Think

The truth is that most humans cannot concentrate for 8 hours per day. According to field studies, the average worker is only productive for two hours and 53 minutes per day.

 

That means only about 3 hours per day are devoted to meaningful work. The rest are spent checking emails, browsing social media, discussing non-work-related things with co-workers, taking breaks, researching, and making calls.

 

This means that your employees aren’t probably working as much as you think, which is great because it means they can still get a lot done with just a few hours each day. What is hard is realizing that you are likely overpaying for full-time employees, which impacts your clients because you need to raise prices just to stay profitable.

 

 

It is not that your employees are ‘bad’ or have dishonest intentions. Just like them, we probably only have 3 hours every day to do truly productive work. So what should we do, given this reality?

 

The New Way To Work

What people are realizing is that there are smarter ways to work. If we trim everything in our workdays that isn’t our core functions (such as emails, managing social media, answering calls, etc), we are left with just a handful of tasks that are within our zone of genius. These are the tasks where we can have the most impact, that we enjoy the most, and what ultimately we get paid for.

 

This is why at Amata we created Fractional Support Services. Most small law firms will not need a full-time paralegal, virtual assistant, and on-site administrative staff. What they need are flexible packages that allow them to hire support on demand (hourly), so that their in-house team can focus on their core responsibilities and become more productive.

Some of the benefits of hiring fractional (part-time) support are:

 

  • Save 60% compared to a full-time employee
  • Take mundane tasks off your daily to-do list
  • Spend more time working with your clients
  • Work with a team to support your practice, not just one or two employees
  • No more time or money spent recruiting
  • Zero employee benefits costs
  • Scale team up for busy periods, scale down when done
  • No more payroll to cover during slow periods
  • Get expertise to help organize your days and reduce the anxiety created when you feel under pressure
  • Make more client deadlines without sacrificing work/life balance
  • Make time to take on more clients

This removes the bottleneck on your operational needs while maintaining flexibility on costs. You can scale up and down without needing to pay for full-time employees, so your full-time associates and key employees can do the most profitable work that they love doing.

 

 

You don’t need a large hiring budget to get operational support for your law firm. With Amata’s new Fractional Support Services, you can hire the specific help you need at affordable rates, and only pay hours actually worked.

Click here to learn more about the different packages we offer!