For solo attorneys, or owners at small law firms, there will come a time for you to leave the practice of law and move on. This can happen voluntarily such as a well-deserved retirement. Or it can happen involuntarily through an unfortunate illness or worse. Either way, it is wise for a law firm owner to plan an exit strategy. Obviously, there are many issues to address when planning for the next chapter. While you ponder the tasks at hand, let me remind you that legal recruiting is essential to your exit strategy.
Why it Matters
I heard of a lawyer in my town who ran his own firm. He was 52 years old and in excellent health. Tragically, he suddenly passed away. The story is that he had no retirement plan and certainly no succession plan. His untimely death caused chaos for his firm, employees, clients, vendors, and other interested parties. The sad story shows the importance of succession planning.
This example may be extreme, but it is poignant. Regardless, it is just smart business to make an exit or succession plan. Not only will it create an orderly transition for all stakeholders (mentioned above), but you can also extract financial value out of your practice.
As your career winds down, you do have options. There are no cookie-cutter approaches so make a plan that will make the most financial and personal sense for you. Those options may include:
- Closing your firm
- Finding a replacement to run your firm
- Selling or merging your firm into another firm
Recruiting Plays a Role
Recruiting can play an important, or essential, role for all the options – except closing your firm. Therefore, if simply closing down the firm is unappealing and you want to leave a legacy, you should hand pick a successor. The successor, a younger lawyer, can begin to be groomed to become the eventual owner of your firm. After a few years of grooming, you can offer this lawyer a partnership. This partnership can be tied to an exit strategy with an appropriate compensation arrangement for you. Recruiting and grooming the appropriate successor will take some time, so get moving as soon as possible.
The other option is to merge with another law firm – a solo, small firm or large firm. This is where I provide the most help to a lawyer with exit plans. I find target firms that will align with your goals. Some of the concerns may include:
- Fair compensation package including ongoing revenue, benefits, and other incentives
- Law firm that will treat your clients as their own
- Employer, if applicable, that will care for your employees
- A plan that will allow you to exit gracefully on your terms and timeline
Start Planning Now
Let’s have a conversation so I can learn your goals. From this conversation, we can begin to map out an exit plan that you control. I am also happy to discuss other thoughts on how legal recruiting is essential to your exit strategy. Contact us to schedule a call.