Many partners significantly undervalue their book of business, and that’s a problem that comes with a dollar sign attached to it.
When partners shortchange their valuations, it in turn shortchanges their leverage, compensation, and the resources they need to serve clients effectively.
Firms are often likely to reduce whatever number you provide by 20%. If you go down 20% on your own, though, and the firm reduces it by another 20%, you’ve just lost 40% of your actual value.
Nobody’s asking you to inflate your numbers. But accuracy matters because that book of business determines everything from your compensation to the support you’ll receive.
Ways partners consistently underestimate their value
The most common mistake I see is partners counting just the business they currently get origination credit for. But your true book includes much more.
Business you brought in but don’t get credit for
Maybe a partner brought in the client 30 years ago and still gets origination credit, even though you’ve generated five new litigations from them in the last three years. They call you for everything, including recommendations outside of legal matters. You know that business would follow you, and it counts.
Work that’s referred out
From practice limitations to geographic restrictions, we find partners often refer out work that could have been kept within the same firm.
If you’re a corporate litigator in New York and often wind up referring out M&A work because your firm doesn’t offer that, there’s origination credit you might be able to capture at another firm. While you might not be able to handle the work yourself, tracking how much you’ve been referring out could help you identify areas where you could bring in expertise over a several-year period.
Or let’s say you have $5 million of business in New York, but clients constantly tell you, “It’s too bad you don’t have an office in California. We’d give you twice as much work.” That’s not wishful thinking if you can back it up with specific conversations and realistic projections.
Does undervaluing your book of business affect opportunities to grow?
When you undervalue your book, you’re not just leaving money on the table. You’re undermining your ability to expand your practice and serve your clients effectively.
Negotiating power evaporates
Your book of business is your leverage. If you have a big enough book, the rules that apply to everyone else might not apply to you in the same way. A $25 million book? A $60 million book? There’s leverage to negotiate for entire teams to join you. You’ve seen partners with $75 million books negotiate for their whole team to come with them and secure the resources they need from day one.
That goes for equity positions also. While most firms have rules about holding periods for equity positions, if you have a large enough book of business, they’ll make an exception. That magic number keeps climbing. While it used to be $3 million, it’s now closer to $20 million at top firms.
Your book doesn’t need to be that significant to have an impact, though. Depending on the type of firms you’re considering, valuing your book at $1 million rather than $500,000 can be a powerful number to point to during negotiations.
Resource allocation suffers
The size of your book directly impacts the resources you’ll receive. Associate ratios, marketing budgets, business development support, and more all tie back to what the firm thinks you’re worth.
If you need three associates to serve your clients properly but you’ve undervalued your book by 40%, you might only get one. Now you’re doing work that should be delegated, limiting your capacity to bring in new business. It becomes a self-fulfilling prophecy of constrained growth.
Growth opportunities are lost
When firms evaluate lateral partners, they’re looking at potential as much as current revenue. If you can make a compelling argument that you have profitable cross-selling or growth opportunities, firms may add to your total book when they calculate it.
But you have to be specific and rational. Saying “I have $1 million now, but I know it will be $100 million at your firm” won’t fly. But explaining that you could have brought in 10 extra M&A deals last year if you had more than one corporate associate makes a compelling business case.
Strategic invisibility
Sometimes the planets align in your favor. The firm needs someone with your exact expertise for succession planning. They’re expanding into your geographic market. They want to grow your practice area as part of their strategic plan. But if you’ve significantly undervalued yourself, you might not even make it onto their radar for these opportunities.
While firms in the midst of succession planning may want a partner with a smaller book of business so they can take over the retiring partner’s clients, or a firm that already has work in a practice or geographic area may be OK with a smaller client base than usual, your book should still represent that you can bring in and keep clients.
Building your business case for your book of business
Start with the facts. Document what you brought in: $1.8 million three years ago, $2.5 million last year, and $3.1 million this year. That’s not puffing. It’s your track record.
Then add the business that should be yours. If clients call you for everything, from travel agent recommendations to business strategy, they’re your clients regardless of who gets the origination credit.
Think of it this way: When clients ask you for referrals outside your practice area, when they call you first for every business or major personal decision, you know they’ll follow you.
Or take a client who’s followed you to your current firm. They’ll likely follow you again. That’s 100% probability based on past behavior.
But consider portability realistically. If you’ve worked with a client for 12 years, vacation in the same complex, and play golf together eight times a year, it’s highly probable they’ll follow you. But be honest about limitations too. If you’re one of five labor and employment partners serving the same client, your percentage might be lower.
If you’re worried about promising something you can’t deliver, remember that firms will ask you to estimate probability percentages. You don’t need a crystal ball. You just need to think through your relationships honestly.
Maximize your internal opportunities first
Before you even think about a move, look at what you could be capturing at your current firm. If your firm rewards cross-selling, your partners might be your best source of new business.
Start with your partners, not your clients. If your firm offers incentives for cross-selling, this can be a straightforward way to generate additional origination.
Tell your corporate partner, “I do licensing agreements, and you represent Netflix. I think they probably need those. We could both make money if you bring me to a meeting.” That’s a win-win conversation.
But understand your firm’s origination credit policy first. Some firms allow you to split origination credit. Others give cross-selling bonuses. At firms where partners invite each other to pitch meetings and share in the success, you can build significant additional revenue. But if there’s no incentive structure, those opportunities might not materialize.
Consider scheduling lunch-and-learns for your partners about developments in your practice area. If there’s an issue on everyone’s mind, like new regulations, market changes, or potential risks, you can position yourself as the go-to resource. Take partners to lunch and explain how you could help their clients, how you could share origination, and how you both benefit.
With clients, the approach is different but equally important. Pay attention to timing. When they’re expanding into new markets, facing regulatory changes, or going through leadership transitions, they’re more likely to need additional services. Those natural inflection points create opportunities for broader conversations about how you can help.
The bottom line
There will always be a firm that values your business appropriately. If you only have $1 million in your book of business, you might not be able to go to the firm where everyone has $20 million. But there’s a firm where $1 million in business is significant, and the firm will support you in growing it.
Before you can do that, though, you need to understand your value fully. Use our book of business calculator to get started. Document it carefully and present it confidently.Your book of business represents years of relationship building, expertise, and trust. Don’t sell it, or yourself, short. If you’re ready to understand what your book is really worth and find a firm that values it appropriately, let’s talk.
