Creating Your Law Practice
to Scale and Sell

Ali Katz:
Money is infinite. You can always make more money. But what you can't make more of is time, energy, and attention. You only have ten years. That's not a long time. It's very fast. It's gonna go like that. And so every time that you take on a new hourly client or that you serve another one off client, you have to ask yourself, is this serving where I want to be ten years from now? Or is it just serving in this immediate moment?

Ali Katz:
Hello, and welcome to the NewLaw podcast, where we guide entrepreneurial lawyers to build law practices into businesses they love. I'm Ali Katz. In this episode, you are going to hear me coach one of our longtime members, Susan, about how to focus her time, energy, attention, and money over the next 10 years to create what she wants. And that ultimately, is a saleable business. So we talk about how she's going to need to change her focus in order to be able to use these next ten years in the best way possible. So, tune in and begin to consider how you might need to shift your focus over these next months or years to create exactly what you want. And remember that you can create exactly what you want over the next three years, whatever that is. If you just think about today and then look three years into the future, know that your life and your business can be completely, radically different depending on the choices you make today, starting with listening to this episode. I'll see you on the other side.

Ali Katz:
Hi, Susan. Welcome. Let's get you past these lingering litigation cases.

Susan:
Okay, great. Yeah, it's not just the litigation. I went through the boot camp starting in May of 21, and I signed up as a member in March of '22. So I'm coming up on a year in as membership, but I really haven't been able to utilize the membership. I mean, I can use the membership, but I'm just having a very hard time figuring out how to allocate my time. The good news is that the ten years I've been putting into my business practice is really paying off now.

Ali Katz:
Oh, yes, I remember your question.

Susan:
Yeah. And I'm doing a lot of consults and taking on clients, but getting a little anxious because I can only take on so many. For the last six months, I have not taken on any litigation, winding up three cases, hopefully by the end of the year. And so I guess I recently hired a part time CSD to help me. And I think when I was talking with my coach, I was just like, well, I'm overwhelmed. I have all these great clients coming in with good business work, but the EP business model is going to make me more money.

Ali Katz:
And have you modeled this out with your coach, Sherelle on cash forecast?

Susan:
We're doing that next time.

Ali Katz:
Okay.

Susan:
Yeah. And maybe that's all that needs to happen.

Ali Katz:
It might be that that's what it takes. Right. First of all, tell me about the business work that you're doing and how much. What's the average fee? How are you doing it? Are you doing it one off transaction style? Are you doing it recurring revenue style? What are you doing over there?

Susan:
Except for like trademarks and copyrights and certain limited contracts that I quote a flat fee for, I'm still doing the billable hour.

Ali Katz:
Oh, goodness.

Susan:
I know, but these clients keep coming back to me.

Ali Katz:
Okay, well, let's get them on recurring revenue.

Susan:
So even if I'm on recurring revenue, they're going to be like, where's my with this and where's my that? And they are entitled to ask me that.

Ali Katz:
I coached her on this, I don't know, ten years ago, and she went to an average of like 3000 a month per client, somewhere between 1000-3000 a month per client. And it was just her. She was solo. Today, Susan, she's doing $500,000 a year. She's got ten clients who pay her $5000 a month on average. And she's still mostly solo. She does have some of counsel work, but because of how she structured the relationship with these clients, it's not a lot.

Ali Katz:
Now, it took her ten years to get there, Susan, so this is not necessarily an overnight thing. I'm just giving you a vision.

Susan:
So you're suggesting that I don't have to move to EP exclusively to hit the numbers that I want, but that I can follow in Denise's shoes and continue a business practice? Yeah.

Ali Katz:
What you need to understand and give yourself. How many more years are you going to practice law?

Susan:
Probably ten.

Ali Katz:
And then you want to sell?

Susan:
Yeah.

Ali Katz:
Okay. Just like I want you doing for your business owner clients, I'm going to do with you right now and say, okay. So what you're doing is you're focusing everything I want, all of your decisions based on that reality, that ten years from now you're going to sell your practice. So what needs to be true for you to have a salable practice ten years from now? You need to have. Go ahead.

Susan:
Oh, no, you go ahead.

Ali Katz:
No, you tell me. I want because you might, you might have a better than I do.

Susan:
I need. My systems aren't bad and many of them are documented, but they could be better. And then I need a staff that can follow the systems.

Ali Katz:
Yeah, right. The challenging part about building, I would say, a business practice to sell is that those business clients that are paying you 3-5000 a month, they will want you.

Susan:
Right.

Ali Katz:
They want Denise. They don't want her all the time. Every time she probably meets with them about an hour a week, and then she is able to get, you know, the work done in between in a leveraged way.

Susan:
Does she use independent contractors or does she have to?

Ali Katz:
Yeah.

Susan:
Okay, and I do that too, I've got three.

Ali Katz:
Yeah, but the hard part about that from a saleability standpoint, is going to be that those ten clients want Denise. Now, is it possible that she can train someone who would then buy that book of business that would then buy those ten clients? Possibly. But if you want to build a saleable business yourself, that is not dependent on you. That's where the estate planning comes in.

Susan:
Okay, well, then that's what I need to do. I need to transition to estate planning.

Ali Katz:
Right. So for me, here's one of the things that was a big shift for me this past year, and it might be a similar shift for you. I had to stop taking on private clients completely. I was seeing some private clients as a LIFTed advisor over the past two years, and I was getting paid a lot of money. I mean, Rob and I, you know, we would take on a client between 25 to $33,000 upfront, and then we would be getting paid somewhere between 3 and $12,000 a month on an ongoing basis. Rob and I together. That's a lot of money. But what I realized is that those serving those private clients in that way was taking away from me building my saleable business. It was taking away from me building my legacy.

Ali Katz:
Because all of that energy that I was giving to my clients, my one to one clients, was taking away from building the systems and the team and the structure and the leadership and everything here at New Law Business Model, and Personal Family Lawyer, and eventually at LIFTed Advisors, because that's the next brand that we'll bring out. And that drain that I was giving to the private clients in exchange for good money was keeping me from doing what I needed to do. And, you know, I teach, and many of you, you all, you hear me teach this - money is infinite. You can always make more money, but what you can't make more of is time, energy and attention. You only have ten years. That's not a long time. It's very fast. It's going to go like that. And so every time that you take on a new hourly client or that you serve another one off client, you have to ask yourself. Is this serving where I want to be ten years from now, or is it just serving in this immediate moment?

Susan:
Right. Obviously I need some income coming in.

Ali Katz:
Well, right. So that's why I want you to get this cash flow forecast in place and the starting place. And this is the teachings of the money map, is how much do you really need coming in? As you make this transition, how little do you really need coming in? What is the minimum? Right. So the first stage of the money map, and many of you have never gone through the money map, but it's available to you. This can be like the most important thing, and many of you are skipping it because it's a bonus program. But for those of you that need it, the first step in the money map, especially as you're making a transition, is to look at how little do you need. And that might sound funny. What do you mean how little do I need? I want to make a lot.

Ali Katz:
No, no, not as you're in your transition. In your transition, you come back to minimum to thrive.

Ali Katz:
Would you love direct support? To help you grow your law practice into a business you love, go to newlawbusinessmodel.com/show and sign up for a call with one of our trusted law business advisors. Each of our advisors has been trained directly by me over the past five years plus to help you chart your path from wherever you are now to where you want to go as efficiently and effectively as possible. You're ready to grow. We are here to help.

Ali Katz:
What is the least I need to take out? Because I'm buying back my time. My time is everything right now. My time, energy, and attention, because I only have ten years to build something saleable. And so every hour that I'm giving up for 4 or 500 now or 200 now, whatever your hourly rate is, $800 now or what is your hourly?

Susan:
It's about $400.

Ali Katz:
Okay, so every $400 hour that I give away is a $400 hour that I'm not putting into building the thing I'm going to sell later. So let's imagine that you need $10,000 a month to take home, personal need. And I'm talking about need here. I'm like, talking about you're not paying back big student loan payments. You're paying your minimum on your debts, if you have any. You are paying like, you're not going out to eat a lot. This is like salad days again, because you're at the beginning to build something, you're going to take out as little as possible.

Ali Katz:
And if you are going out to eat it's a business expense, like everything is business now. So what's the least? And then from there you establish your baseline goal and you say, okay, it's $25,000 a month and out of that I'm going to take 10 and I'm going to pay out 15 and expenses because I'm building. Let's just imagine that those were the numbers. Then what is the most efficient way I can make that 25?

Susan:
Mm hmm. Right, I follow.

Ali Katz:
You know, and that's what you're going to put in your cash forecast. And then you are not going to take one more client than that. You're going to set up your calendar because that's step two. You're going to set up your calendar so you only have space for those number of clients. You only have space for those number of clients. Now the challenge with a $400 an hour model. Let's just do the math. You need to bill 62 hours, is that right? 62 hours in a month to get your $25,000.

Susan:
You lost me, I guess. Are you dividing $25,000?

Ali Katz:
$25,000, yeah. And I'm just making up the $25,000 as your monthly number. I don't know what your monthly number is.

Susan:
Yeah, that's fine. I understand that.

Ali Katz:
And so if that was the case, if this was reality, I would map my calendar for 62 and a half billable hours. Like if I was still going to use a billable, I wouldn't, personally, I wouldn't. I would actually package those hours up into outcome based packages for things like an x number of trademarks or x number of some things. I wouldn't do it hourly, but if you were going to do it hourly, then I would put those billable hours slots on my calendar and that's it.

Susan:
Right. So you're like, that's per month, so that's only like 15 hours a week.

Ali Katz:
That's right. And you're like okay, I got still available time. That's right.

Susan:
Yeah, I like that.

Ali Katz:
But not take an hour more of it and then start to think about how can I package those hours into outcomes? How many trademarks is that or other things that you do? And how many of those business clients get to become estate planning clients at a 4, 5, $6000 or more fee? Because if they're business owners, they actually need a lot more. Business owners don't just need 4, 5, $6,000 plans is the reality, for the most part, they need more. And if you're learning how to do advanced asset protection planning now you're starting to get into much bigger numbers.

Ali Katz:
Let's not get too far ahead of ourselves. Let's just get the time freed up.

Susan:
Yeah, that's what I need, the time.

Ali Katz:
So, yeah, I'm going to also show you. I showed this on the last call. A private client came to work with me and we worked on her calendar. She's working a lot. Right? She's got a lot of meetings, but her goal is to transition all of these meetings, many of these meetings, over to team members by June so that she can be out of the office for June. But in order to do that, that cannot happen in her head. And look at this, it only has the exact number of client meetings that she needs each month to hit her financial goals.

Susan:
Yeah, it sounds like I'm going to have to either send this work to my contractors or turn it away, yeah.

Ali Katz:
But when you do that consciously and intentionally, because you know that it is in service to something bigger, then you can do it while soothing your nervous system to know that it's going to be okay. As long as you hit your goals. As long as you know what your goals are.

Susan:
Yes.

Ali Katz:
And then stay focused on them. You will hit them. You will. And I think part of your challenge of why you haven't made progress is you just haven't taken control of your time and your money. It's in too much in your head.

Susan:
Yeah, I've been too busy. I'm not giving it space and need to.

Ali Katz:
Right. You're too busy because you're not in control of your calendar. Your calendar doesn't look like that. I'd be really interested to see what does your calendar look like? How far out.

Ali Katz:
Why did you laugh? Tell me why you laughed.

Susan:
Oh, just because I have an overlay like that, that I ignore on a daily basis. Right. Because I have chosen not to prioritize it for whatever reason.

Ali Katz:
Right. And it takes something. It takes discipline. It really does. It really takes a level of discipline that could be new and is worth it because you only have ten years. Just keep reminding yourself of that and you can make this shift a year from now. Like, by this time next year, it can be totally different. But it's going to take you really prioritizing your calendar. And I would start by making sure that your calendar has all of your self care booked.

Ali Katz:
That's where we started with Angela's calendar this weekend. We booked in all of her personal things that she needs to do for herself. Then we booked in her family things, and only after that did we book in her work things, and then we only booked in the exact amount of work things that she needed to do to make the amount of money that she needs to make so that she could also book in the things that will support her transition because those needed to be booked in too. And now she's in charge. So, you know, it's not like a 1 hour thing. It's going to take a little bit of time. So maybe you're going to block off time this weekend to just do it. It's an interesting thing that we get to look at where we're just not making different choices.

Ali Katz:
We're just doing habitually what we've always done because it's hard to make a change. And I really get it. I really, really get it. I'm in the middle of a big shift myself. I'm right there with you right now. I'm doing it alongside of you. And in the past, I would say now three months, I have made choices that were very difficult for me to make. I've let go of my private clients.

Ali Katz:
I have chosen to not go to some trips, some birthday parties. One of my dearest friends was turning 50. I didn't go, some other things that came up that, like in the past, I would have chosen. I would have chosen to go do that thing. I didn't, I instead chose to stay here and be focused and coming back from Costa Rica to go to Austin because it matters. And so as I'm making these choices, I hope that it will inspire you to make these choices for yourself, too, and know that you can do it. It's hard. I know I'm right there with you, and there's things we can do to make it easier for ourselves.

Ali Katz:
You can reward yourself in many ways, and you will see the rewards as well. Believe me, I'm seeing the rewards as well. I wouldn't do it if it was all hard. It's just, It's like a process of growing up and maturing. So we don't want you to make it to 70 without growing up. And if you are 70 and you've made it to 70 without growing up, we don't want you to make it to 80 without growing up. Way more fun if you do it sooner.

Ali Katz:
Again, I hope you loved that episode as much as I did with Susan. And really looking at what does it take to build exactly what you want. And what I learned from this episode, and I hope you did as well, is that it really takes support, it takes help to really be able to see what you can't see on your own, and a lot of that is around where should you be focusing your time, energy, attention and money. We call that your team resources. And so if you want our support to help you to get clear on where you want to be three years from now or ten years from now so that you can make the decisions today that will get you there as efficiently, effectively, affordably as possible using your time, energy, attention and money, go to newlaw.co/show and book a call with a law business advisor. Now if you are not a lawyer, I know we have a lot of non lawyers listening to these episodes and you want support, do me a favor and drop me an email at support@newlaw.co and let me know because I have some really exciting things coming up for non lawyers and I'd love to hear from you. So if you are a non lawyer listening to the show, then drop me an email at support@newlaw.co. But if you are a lawyer and you want our support, go to newlaw.co/show and get on the line with a law business advisor. I'll look forward to seeing you on the inside.