The Dark Days of Starting a Law Firm

The idea of starting a law firm from scratch has a certain romantic quality to it.

The process of entrepreneurship and starting from nothing has been idealized in movies and books.

Of course, it’s been idealized by those who succeeded and made it. Not many losers write books about losing. Hence, we’re left with a skewed view hanging one’s shingle.

As someone still writing the story of his firm, I wanted to talk about the dark days in the beginning. It helps keep things real.

I started Brown Law in Salt Lake City in 2010.

Before that, I was an insurance defense attorney in New Mexico. I hated that job. Hated every second of it. I would get a sick feeling in my stomach every night around 8 p.m. because I knew I had to go to work the next day. I didn’t smile for the last three months I worked at the firm, so I quit.

About that time, my wife wanted to move to Utah to get her doctorate in vocal performance. We had attended to college in Utah (it’s where we got married) and liked it there, so we moved.

Problem: I wasn’t licensed in Utah, only New Mexico.

I spent the next six months passing another bar and finding whatever work I could to augment my wife’s $1500-per-month grad student stipend.

I had no network in Utah. I had no prospects for a firm job (it was 2010, so hiring was nonexistent). I had nothing, except a healthy fear of not being able to provide for my family.

Because I’m not a smart man, I decided to start a law firm. Always wanted to, and I knew if I didn’t do it then, I’d never do it. Instead, I’d eventually find some firm job, put on golden handcuffs, and be as miserable as I was at my old firm in New Mexico.

While waiting to take the bar, I called the owner of the company I worked for in college. I asked if I could have my old job back. He was very nice and said yes. $12.50 an hour.

I was an attorney who graduated with honors and finished a successful judicial clerkship, making $12.50 an hour.

I felt low. I felt like a failure.

I kept going, though, not wanting to concretize my failure. Eventually, while working my $12.50-an-hour job and studying 16 hours per day, I passed the bar.

Oh, and I had to retake the MPRE. Forgot about that. Only passed that by three points (first time I passed it by, I think, twenty-five points).

I then found myself in an ill-though-out office-sharing arrangement. It cost about $1700 per month, and I had $0 in revenues.

The receptionist was this awful, anti-charismatic women from South Africa. She would answer the phone and repel people with her tone and demeanor.

I remember I wanted to install a credit card machine to make it easier for clients to pay their bills. The receptionist told me I couldn’t, “Because that’s not how we do things, and it might mess up the phone system.” Keep in mind, this was 2010, not 1982.

I worked 40–50 hours per week at the law office, and then another 40 hours on nights and weekends at my $12.50-an-hour job.

I spent most of law firm time meeting other attorneys (i.e., networking), volunteering, hanging out at the courthouse, reading Utah law, and giving presentations about special-needs guardianships.

The first four months of practice brought in about $2000 in cash, and about $7000 more in billed time.

I was so poor at business and billing, though, that I did collect on the billed time. I was afraid if I pushed too hard, the tiny number of clients I had would fire me, and then I wouldn’t even have the possibility of getting paid. Besides, I rationalized, I needed the experience, even if I never got paid.

The first four months also brought in about $6000 in debt to the guy who owned the office. I was burning through what little we had saved while we were in New Mexico just to eat, and so the owner went unpaid.

Couple all that with the $150,000 we owed from law school and my wife’s master’s degree, and we up to our eyeballs in debt.

Instead of going deeper in the hole, I left the office and worked out of a room in the condo we were renting.

I was totally alone. My wife was at school all day, and my son was at daycare.

I would sit and work (I may or may not have worked in my underwear) and worry.

One of my primary sources of meager income was guardian ad litem cases. In those days, the state GAL office would send out emails asking attorneys if they were available to take a case. It was first-come-first-served. I used to sit with my Gmail account open, waiting for a GAL office email to come through.

I had a cut-and-paste template ready to go, and I often responded before everyone else.

Of course, I only ever got paid, at best, half of whatever I billed on GAL cases. And most of the time, I never got anything beyond the $1500 retainer ($750 each side).

In fact, on one of those GAL cases, each side was into me for quite a bit of money. I told them I needed the to pay up, that way I could sign off on the stipulation they and their attorneys worked out and close out the case. (I knew they wouldn’t pay if I signed off before getting paid.)

One of the attorneys, wanting to close the case out quickly, threatened to send the judge a letter badmouthing me if I didn’t sign off right then.

I couldn’t risk damaging my reputation with a judge that early in my career, so I relented.

I never got paid.

It seemed like nothing worked, and still very little money was coming in.

So, I started applying for firm jobs, something I told myself I would never do because I didn’t want that life again.

I never got a single interview, in part because I applied for jobs way outside the area I actually had experience in (insurance defense). And, in part, because I didn’t actually want a firm job.

I was seriously thinking about giving up the law completely. Maybe I’d make that $12.50-per-hour job permanent and work my way back up in that company.

Then, all in one month, almost all my clients paid their bills.

$17,000 in one month.

It was enough to pay off the $6000 I owed from the first office, quit the $12.50-per-hour job, and rent a small office down the street from our condo.

From then on, people paid their bills (not 100%, but at least 50%), and I had enough work to sustain the firm and grow.

Thus, ended (for the most part) the dark days of starting a law firm.

P.S.: As with all stories, I left out a lot about the early days of Brown Law. Maybe later I’ll write in depth about the attorney who tried to have me kicked off a case by accusing me of trying to have sex with his wife (seriously, that was his argument). And maybe one day I’ll write about having to move out of my second office at 10 p.m. one night because the building owner had become so unhinged he would walk in to the office yelling and scaring my clients.