The Fresh Law School Graduate’s Guide to Starting a Practice
For many, the logical step after completing a Juris Doctor degree and passing the bar is to get real-world experience as an employee at a law firm. However, this isn’t the only option. It may be a bold move to start your own law practice – but it’s by no means impossible. Here’s what to know as a law school graduate starting a practice.
Considerations for Law School Graduates Starting a Practice
According to one American Bar Association survey, solo-run and small firms (with less than ten attorneys) make up most of the legal field. With careful planning and preparation – and the credentials and licenses – you may be able to join their ranks.
Tackle the Administrative Aspects of Starting a Business
In addition to obtaining your law degree and state license, there are administrative components to consider when starting a legal business. Possible steps may include selecting a structure (e.g., limited liability company, sole proprietorship, corporation), registering your entity with the state, and applying for state and federal tax identification numbers. The U.S. Small Business Administration has resources that can help guide you through the technicalities.
Write a Business Plan
Advanced planning can help support your fledgling law firm’s success. A business plan can provide valuable organizational guidance. This document includes a company description, market analysis, organization structure, description of services, marketing plan, and financial projections.
In addition to serving as an internal guidebook for running your firm, a business plan can also be used to request funding. If you need extra money to start your law practice, you may apply to lenders or investors for financing. They may request a business plan before they provide any funding. The same may be true if you want to take on a partner for your firm.
Focus on a Defined Legal Area
The market analysis you conduct when preparing your business plan can help you define a focus area for your law practice. Narrowing your focus allows you to gain more in-depth knowledge of a certain field. There are a few factors to consider when choosing a focus area.
Personal interest is one component. You want to choose a practice area that genuinely excites you. Otherwise, you’ll likely have trouble focusing on work – and excelling in your field. Location is likewise a consideration. If entertainment law is your passion, you’ll likely need to move to an urban center like Los Angeles.
There are also overarching trends to consider. For example, growing concerns regarding information security in an increasingly digital world may result in greater demand in data security and privacy fields. Changing legal regulations, such as the California Consumer Privacy Act, may also impact demand for such legal focus areas.
Work on Your Network
As a law school graduate starting a practice, one of your biggest challenges may be getting clients. Networking is helpful. Keep in contact with lawyers you meet during internships and other training opportunities in school. Attending law school alumni events and joining professional legal organizations can also expand your network.
Networking can be a practical means of finding a mentor. One potential drawback of spearheading your own law firm is that you won’t have built-in access to senior attorneys like you would in a big firm. A mentor can provide valuable guidance as you progress in your career.
Networking can also help you secure contract work for other firms. While you ultimately want your law practice to have its own client list, supporting other attorneys in their work – for example, by conducting case research – can be a good way to maintain financial liquidity as you build your firm’s client base. Contract work can be especially beneficial if you have financial obligations like a mortgage.
Invest in Marketing
Your network is one way you can start building a client base. However, you should also invest in your own marketing efforts. A website is a good place to start. This is your digital calling card, allowing you to share relevant information with potential clients, such as:
- Your educational credentials and licenses.
- Legal practice areas.
- Differentiating assets.
With a website in place, you can consider other types of marketing, from billboards to social media.
It may be helpful to review your state’s requirements on marketing practices. For instance, some states have rules that ban you from claiming to be an “expert” or “specialist.” Meanwhile, others disallow comparative statements, e.g., “We are the best family law practice in Virginia.”
Invest in the Necessary Business Technology
Technology can help streamline your business operations, improve efficiency, and generally deliver more value to your clients. For instance, you might use secure file-sharing platforms to share documents securely and ease collaboration. Encrypted email platforms likewise can help protect email data, attachments, and contact lists.
Technology can also ease internal operations. A mobile project management system can help you keep track of different case files and relevant deadlines, even when you’re on the go. When it comes to such mobile applications, make sure to keep both your device and the application itself password-protected. As a lawyer, you handle sensitive client data, and this needs to be safeguarded.
To further your commitment to protecting confidential client data, you might consider cyber liability insurance. This can help minimize negative repercussions in case of a cyberattack, providing protection for things like computer replacement, digital asset restoration, and extortion expenses.
Help Protect Your Law Practice
As a law school graduate starting a practice, it’s important to protect your new business. Cyber liability insurance is just one possible precaution you may take. Malpractice insurance can help protect you in case of claims related to your professional work.
Further, depending on the state you practice in, malpractice insurance – also called professional liability insurance or errors and omissions insurance – may be required. For example, Oregon mandates professional liability insurance for lawyers, while Texas requires limited liability partnerships to carry insurance of at least $100,000 in potential damage protection.
Some states also require you to notify your clients if you don't have malpractice insurance. Even if insurance isn't mandated in your state, it can help bring peace of mind to you and your clients. Further, some clients may require a law firm to carry a minimum limit of liability.
Depending on the policy, it may help protect you against:
- Potential damages resulting from professional liability claims.
- Claims-related legal defense costs.
- Loss of earnings due to attendance of a trial, hearing, or arbitration proceeding.
- The cost of disciplinary defenses, e.g., opposite your state bar association.
This is just a sampling of what a policy may include. With Aon Attorneys Advantage you can get a quote online in minutes and compare rates.
Get a Quick Quote.
This information is provided for general informational purposes only and is not intended to provide individualized advice. All descriptions, summaries or highlights of coverage are for general informational purposes only and do not amend, alter or modify the actual terms or conditions of any insurance policy. Coverage is governed only by the terms and conditions of the relevant policy.