Latest / Wealthy Woman Lawyer Podcast, Helping you create a profitable, sustainable law firm you love / Episode 259 The Top 3 Mistakes I Made When Scaling My First Law Firm (And How to Avoid Them)
Transcript
- 0:00Davina: And I really started applying them to the law firm business. And it was this journey to find those solutions that led me to coaching other women law firm owners, because I knew if I didn't know the answers, that there were a lot of you out there who probably didn't know the answers as well. So I was able to create a framework that I can now teach other women law firm owners to make it a lot easier to understand those business principles that you need to apply if you want to scale your business.
- 0:32Intro: Welcome to the Wealthy Woman Lawyer podcast. What if you could hang out with successful women lawyers? Ask them about growing their firms, managing resources like time, team, and systems, mastering money issues, and more. Then take an insight or 2 to help you build a wealth generating law firm. Each week, your host, Davina Frederick, takes an in-depth look at how to think like a CEO, attract clients who you love to serve and will pay you on time, and create a profitable, sustainable firm you love.
- 1:03Speaker 2: Devina is founder and CEO of Wealthy Woman Lawyer, and her goal is to give you the information you need to scale your law firm business from 6 to 7 figures in gross annual revenue so you can fully fund and still have time to enjoy the lifestyle of your dreams. Now, here's Devina.
- 1:22Davina: Hi, everyone. And welcome back to the wealthy woman lawyer podcast. I'm your host, Devina Frederick. And today, I thought I would share with you the top three mistakes I made when I was scaling my first law firm business. So maybe you can avoid them without having to learn the hard way like I did.
- 1:401st, you should know that I opened my first law practice fresh fresh out of law school. I was about 42 years old at the time, it was a second career for me. And I went to law school specifically for the purpose of opening my own law firm business when I graduated. Technically, my first law firm was just me. I was a true solo, I was doing all the things.
- 2:03But about a year in that business, I invited a friend from law school to join me as a partner and renamed my business, we formed Frederick Stewart Law Group. And that's the firm I'm talking about today. Because it was really the 1st law firm, one where we hired people and we set up systems, and we took on hundreds of client matters and clients. And at that point, I was no longer a solo doing everything myself. I was really looking at that partnership as my first law firm business.
- 2:36I made many, many mistakes in growing my that law firm business, as one does when they're trying to sort of figure things out on their own. But I thought I'd share these three particular mistakes with you today because I've had so many conversations with other women law firm owners through the years who've made similar mistakes. And maybe by hearing my story, you'll think twice, and maybe you can avoid some of these. So mistake number 1 was, that I hired too many staffers out right out of the gate and not enough lawyers. We were pretty admin heavy right from the beginning, because we kept looking for more help for things that we didn't want to do.
- 3:19And we were just getting so busy and inundated, so we were always looking for help for taking things off our plate. And if I were to do that again, I would have I would probably be more strategic in my thinking. And I would have hired more lawyers and fewer admins, because admins are expenses, even though they're freeing up some of your time, their expenses, whereas lawyers are going to be adding to your bottom line. I would have taught the lawyers how to handle their own work from start to finish. And we would have had more people going to court for us instead of my partner and I always go into court and billing more hours while we, my partner and I handled the rainmaking and the new client consults.
- 4:02My partner was excellent at ferreting out more great clients. But we were both running back and forth to court in in 3 different counties, so much that it limited our time to take on more work. And while a good admin can help you reclaim some of your time, too many non biller billers can really eat away at your bottom line. So my number one piece of advice is, after you hire that first assistant, maybe consider adding another lawyer to your team instead of another admin. Of course, this advice is very general, and your circumstances may be different.
- 4:40So if you want to discuss your particular circumstances with me, then please schedule an appointment. And we can do that. This is not legal advice or financial advice. This is just sharing with you the mistake I made and what I would do if I were to do it differently. The link is in the bio if you want to schedule a call with me to talk about your particular circumstances.
- 5:00Mistake number 2, and this is a big one, allowing toxic people to stay in my business and undermine the workplace culture my partner and I were trying to create. I remember we hired this one woman in particular who loved to gossip. You never heard very much about her and her life because she would love to pull people into conversations and get all the scoop on them and then go talk about them behind their back and stir up drama. And then she would sit back and watch the fallout. And people who try to pit others against one another and play mind games like this can be incredibly destructive in a workplace.
- 5:41Now, you might see this in terms of maybe you have that paralegal or assistant who's been with you since the beginning. And she's been with you for years, but now that you're starting to grow and hire other people, that person may be acting out and kind of undermining those people. And because they want to keep that relationship with you, and it makes them uncomfortable. I see that a lot of times. I was really naive back at the time.
- 6:07And this particular employee was pretty sly. So it took me far too long to sort of root her out and figure out what was going on. It's really only with hindsight that I see the real damage that she caused in the business. And as the leader of the firm, I had to deal with the fallout of her bad behavior, I had to have a lot of conversations with a lot of employees, and not really pinpointing it back to that one particular employee. And that drama, that sort of having to constantly deal with drama, was really one of the drivers that caused me to sort of step away from the firm.
- 6:41When I did, I was really over dealing with that drama of running a business and and dealing with people problems. So here's my tip for you. Negative people are like cancer cells in any organization. They must be eradicated before their negativity spreads. They can cause good employees to turn sour, which is what began to happen in our firm, some of our good employees started to get into the gossipy thing.
- 7:09And it became really ugly. My job as a leader was to stop that from happening as soon as I spotted it. And instead, I let this person linger in the business. And it kind of destroyed the good thing my partner and I were building and I should have put a stop to that. So I would advise you just to be aware of the impact of a negative employee.
- 7:30If there's somebody been with you a long time, you may feel some loyalty to them. But you just want to keep your eye on your ability as a leader to everyone who works with the firm, not just somebody who you're trying to give a second, 3rd and 4th chances to. Alright, mistake number 3 is walking away from my partner and my business too soon instead of asking for help. I felt really overwhelmed. Because I felt like I was wearing all the hats.
- 7:58I was a managing partner, I was a firm administrator, I was a litigator, I was a bookkeeper. I was this referee between employees. And this employee drama, I was a therapist to my clients, because I had much more porous boundaries back then. And I didn't draw the line with my clients and suggest that they go talk to their actual therapist about some of their problems. I was far too available.
- 8:21I didn't know how to identify the source of my feelings of overwhelm and anxiety, much less discuss family law mentors or real estate mentors, I did not have family law mentors or real estate mentors, I did not have any coaches or mentors to help me with leading the business, I got so caught up in the day to day activities, those sort of putting out fires, that I never really took the time to understand how to become a leader who could lead a scaling law firm business, or really even understand that I even needed to devote time to that. Like many law firm owners, I just kind of thought I would figure things out along the way. We kind of think we'll just you know, that leadership is some innate sense, not a skill that we have to learn. And I was really wrong. At the time, there were only there were not nearly as many resources available to law firm owners on how to run a law firm business, the one option I knew about was about $5,000 a month.
- 9:28And it really seemed to be geared more toward larger law firms. And I remember purchasing materials from my local bar association, about running a law firm business, but mainly, those were around how to manage the trust account, and how to follow the bar rules, and how to stay out of trouble with the bar. There was no guidance on how to market the firm make money, so that I could have a living and do good work, when and how to hire people, how to fire people, how to manage people, how to be a really great leader, or how to set up good business systems. It wasn't until I walked away from this law firm and started my second firm, that I began to research resources on best business growth and management practices. And I really started applying them to the law firm business.
- 10:19And it was this journey to find those solutions that led me to coaching other women law firm owners, because I knew if I didn't know the answers, that there were a lot of you out there who probably didn't know the answers as well. So I was able to create a framework that I can now teach other women law firm owners to make it a lot easier to understand those business principles that you need to apply if you want to scale your business. If you you could use some more support and guidance, so you don't have to spend years trying to figure it out like I did, then I invite you to schedule a call with me. As I mentioned, the link is in the bio. And we can see if we're a good fit to work together or if I might be able to share with you the framework that I use to scale my business.
- 11:07I I hope you enjoyed this week's episode of the Wealthy Woman Lawyer podcast if you have. And if you are an Apple Podcast subscriber, then please leave us a review there. If you're an Android user like me, then just shoot me an email. And let me know you're listening and enjoying the podcast. I'll be back next week with more content created just for women law firm owners like you.
- 11:28I'll see you then.
- 11:29Intro: If you're ready to create more of what you truly desire in your business and your life, then you'll want to visit us at wealthy woman lawyer.com to learn more about how we help our clients create wealth generating law firms with ease.