Friday, May 24, 2013

Wanna Be a Cowboy



Anonymous Comment:  ....People/employers/the world cares about money. "How much money can you make for me?" If you went to Harvard and can't generate revenues, you're getting cut loose by end of the year. If you went to Cooley and can generate $2MM in bills, you're a damn rockstar and partner.

Dear Prospective Law Students a/k/a Legal Cowboys & Cowgirls:

You have undoubtedly heard the term "rainmaking" in relationship to practicing law. You probably vaguely understand that it means "getting clients." It is undoubtedly an abstract concept to you at this point. You assume there is some sort of relationship between "being a good lawyer" and "being a rainmaker." Since you are confident that you will be a good lawyer, you have little doubt that you will be a rainmaker and have lots of clients. Let me assure you there is little to no connection between these concepts.

You need to give considerable thought to the rainmaking aspect of practicing law before you actually decide to go to law school. I know that you believe that "highly over saturated legal market" doesn't apply to you, but it does. If you do not know where your clients are coming from before you go to law school, you are really going to be at a loss once you graduate.

The rainmaking metaphor is apt for a lot of reasons. We need water to live. You will need bountiful paying clients to have a growing, thriving practice and be able to pay your bills. The current legal market is not a rain forest; it is a desert. A dry, dry desert.


Place yourself for a moment in the Old West in the late 19th century. You are a young greenhorn fresh off the train from out East. You don't know much about cowboying, but you always dreamed of being a cowboy when you were growing up. You spent your youth reading books about cowboys, then you borrowed a small fortune at a heavy interest rate from a shady New York banker, bought a few hundred head of cattle and headed out West on a train with cattle cars in tow. The train drops you and your herd off at a town in the middle of no where and pulls away leaving you behind. You see the conductor laugh and shake his head as the train pulls away.

What do you do now? The cattle need water. You start asking the old timers where to take your cattle for a drink and they just snicker at you. Someone finally takes pity on you and explains that most of the water was diverted from the river by the large land and cattle barons and now a major drought has hit. The mighty river is just a trickle. Carcasses of dead critters line its banks. The old timers sneer and ask "didn't anyone out East tell you about the drought and the land barons? Wasn't it in the fancy newspapers out East?" Yes, you say, but you always wanted to be a cowboy and you really didn't think you would have trouble watering your cattle once you made it West. You read all the books about cowboying. You're a cowboy now in your heart. You own fancy boots, a big hat, a lasso and a horse named Trigger and everything. Somebody just needs to get you some water for your cattle before they all die so you can show them what a good cowboy you really are. You wish you could make rain like the Indians or something. So, Tex, how are you going to water your cattle? Your cattle are dying, Tex.

So, lawyer cowboys and cowgirls, how are you going to get paying clients? (Keyword in that sentence is "paying" incidentally. There will be no shortage of people with problems who cannot afford to pay you.)

If you are just the child of some Blue Collar Joe who grew up in a working class neighborhood you have your work cut out for you. First, everybody you grew up with already knows a lawyer or is related to a lawyer. Second, keep in mind most people go their entire lives and may only need a lawyer once or twice. Plus, if they can do it themselves they probably will do so. Remember dentists have it all over lawyers. A dentist only has to have about 1,500 to 2,000 patients for a sustainable practice because the patients are on six-month recall. If you try to skip your dental appointments, you end up paying for it down the road. Legal clients are not on six-month recall with their attorneys. In fact, they are likely to be angry at their attorney for the legal process and the cost of legal services and not return period even if they do need more services. The phone needs to be ringing all the time or you are in trouble. Can you generate a quarter million a year in legal revenue to pay for your office overhead and staff and leave a little left over for yourself? That's a start. What about a half million? Year in and year out? If not, stay away from law school.

Did you grow up the child of some Silver Spoon Richy Rich? Is your dad and his friends over at the club wealthy? Do they have businesses that are either growing or tend to get themselves in trouble? Do you have enough experience and social suction to pull that work away from the current lawyers doing the work? If so, maybe law school is for you.

Please understand that even if you land a job with a law firm, you need to start producing from your own client base or you will be gone and replaced with a freshly minted lawyer. No one cares how good a lawyer you are because there are lots of really good lawyers. You eat what you kill in life.

Being a "good lawyer" isn't enough. Wanting to be a lawyer from the time you were born isn't enough. Can you make rain? Do you have access to the water you need to water your cattle? If you cannot answer this yes before you apply to law school, then do not apply to law school. A herd of stinking dead cattle is not pretty. 

Oh, and by the way, that banker out East that lent you the money to buy the cattle? He hired some really nasty Black Bart outlaw types to track you down. Get along now, little Cowboy.

41 comments:

  1. "Being a "good lawyer" isn't enough. Wanting to be a lawyer from the time you were born isn't enough. Can you make rain? Do you have access to the water you need to water your cattle? If you cannot answer this yes before you apply to law school, then do not apply to law school. A herd of stinking dead cattle is not pretty."

    Exactly! Lemmings need to understand this concept before applying. Just as they should understand that the lawyer job market is glutted and shrinking. And of course, they need to fully comprehend the economics of going to law school, before they even take that first practice LSAT.

    Also, that anonymous commenter needs to look up this thing called "tort reform." Current students and recent grads from Cooley or other TTTTs will have pretty much no shot at winning $2 million jury verdicts involving negligence - while working at 2-10 man firms. In this newer climate, judges will often reduce or slash jury awards that they find excessive.

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    1. A lot of lemmings may reply that they only want to work for the goverment or in-house, and thus will be freed from the onerous task of making it rain. These lemmings don't realize how highly coveted in-house & goverment jobs are.

      LEMMINGS: No one gets to go in-house or government these days without years of prior biglaw experience or Daddy's connections. When you're a newly-minted Toileteer with no legal experience you are going to be competing with hordes of top-notch T14 grads to get these jobs. The government/in-house route is not an option for Toileteers anymore, if it ever was. You people are trying to join a musical chairs game where people are already sitting in all the chairs, then some.

      Anecdote: Upon graduation in 2008, I decided to donate my time to some of the legal aid clinics in Chicago. I thought I could do some bankruptcy/tax work for poor folks and gain some valuable legal experience. I was licensed, but I still could not get a single organization to allow me to work for them for free. Why? I eventually talked to to the manager of one of these places and he told me they got a dozen resumes a week from T14 grads with work experience and wouldn't wouldn't have to train them.

      LEMMINGS: YOU LITERALLY CANNOT WORK FOR FREE TO GAIN EXPERIENCE. That should tell you something. The law school game is stacked against you from the start and filled with charlatans (Valvoline Dean) and snake oil salesmen. You would be better served by piling that $100K+ in your back yard and burning it.

      Figure out what you love to do and figure out what you're good at. It could be you love tinkering with cars: become a mechanic. It could be that you like driving and sitting on your ass: become a truckdriver. Experience has taught me that you have to follow your passion. I strongly recommend aspiring Toileteers read "Do what you are." It's a book that really helps tease out your strengths and abilities and suggests possible career paths. Or take a Briggs-Meyers test, see what your profile is, and look at sample careers in those areas.

      But don't mortgage your life by going to law school.

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    2. The government is not hiring except for the few musical chair appointments at the top. In the off chance there is an opening, every single veteran otherwise meeting the job qualifications has a point advantage over you in hiring. And there are a lot of veterans without jobs right now. You are at the back of the government hiring line without those points.

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    3. ^ Um, then join the military for four years.

      My girlfriend works for a government agency. She says that her office gets a new attorney every few months - and almost all of them have no experience and recently graduated from TTTs. Hell, one of their recent hires even graduated from Cooley.

      Sure, connections and veteran status matter. But the commenter who preceded you doesn't seem to understand that the people who hire for the government do not care - at all - if you attended a "T14."

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    4. @8.02 - http://money.usnews.com/money/blogs/outside-voices-careers/2013/04/17/why-you-shouldnt-follow-your-passion <-what she said.

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    5. " But the commenter who preceded you doesn't seem to understand that the people who hire for the government do not care - at all - if you attended a "T14.""

      Whoa, whoa, whoa. Really depends on what you mean by "government." Federal gov't and agencies like the IRS, SEC, DOL, FTC, etc. absolutely care what law school you went to. They love hiring T14 grads through summer hire programs and generally avoid recruiting at trash heaps.

      State governments vary widely, but usually care mostly about either being from the area or going to the large state school. Other than that, veteran status and connections are the ONLY way a Cooley grad would get looked at for a non-Michigan government gig.

      You can't just treat all "government" equally. That's like when law schools treat "clerkships" equally.

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    6. My original point about getting a job with the goverment still stands.

      Of course I was originally generalizing about the government. And if, IF, you care to do JAG work, you have some pretty good options. I was under the impresion that JAG is pretty gosh darn selective but maybe I'm wrong about that. Shoot, half the Toileteers I know wouldn't even be able to pass the extensive background checks required by the federal government.

      If you look at who is getting the federal attorney jobs, it is not Toileteers with no prior substantive legal experience. A Toileteer friend of mine got hired by the PTO as a staff attorney, not exactly the most glamorous thing in the world. He was valedictorian of his Toilet, had a decade of patent experience, had teaching experience, and Biglaw experience. That's the kind of background you need these days to get a federal job. I have another Toieteer friend who has worked for the IRS for 15 years and he tells me there is no way he would get hired now.

      There are just way too many quality people from T14 law schools with lots of experience who actually want to work for the government, and your Toileteers have no chance against that. It's a basic imbalance of supply and demand.

      I naively thought I would try for the Justice department honors program in 2L fall until I asked my Legal Writing teacher for a recommendation and she just started smirking. I still applied, but I never expected to hear back from them and I didn't.

      At the state/local level I'm sure it's a bit different. But you still have to have connections or some kind of "In," like being a local. You might have to do political work first to earn favors.
      But look at public defenders. At my former toilet, they were tripping over themselves to get a job that pays ~$42K/year.

      My point is, government is not the fallback option it might once have been.

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    7. I must agree with 10:41 - the feds do care about T14 - state agencies, not so much. I have worked for 4 different state agencies since finishing law school in 2002. I attended a TTTT and started with the state after completing a fed clerkship. Most of the attorneys I worked with over the years are grads of the two law schools in the state. At one particular agency, where I assisted with hiring, if we received an unsolicited resume from a T14, it generally went straight into the trash, unless there was a connection to the office. As for no govt jobs - see the following (seeking six entry level appellate attorneys): http://www.coloradoattorneygeneral.gov/employment/attorney_positions

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    8. If you have two law schools in your state, it's a lot different than a lawyer-heavy place like NY or Chicago or Boston, all of whom can hire from the T14s.
      And I note that although the Colorado AGs website says entry-level, they do require at least a year of relevant work experience. Doesn't look entry level to me. Just saying.

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    9. @12:00 - my point is that T14 or whatever makes no difference where I practice. Maybe those considering law school (if there are still any out there) should focus on the local schools and forget about the status of T(insert whatever). As for the AG jobs in CO, a law student who interned at a DA/PD's office or worked in a student clinic during law school will likely meet the min quals. Just saying.

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    10. I work at a regional office of the SEC. Our office routinely "hires" interns from local law schools and they are volunteers. For at least the last five years, our office has hired permanent staff attorneys exclusively from BigLaw. Many are T14 grads but many are not...what all the new hires have in common is several to many years of securities experience in BigLaw. The typical new hire has 3-5 years of BigLaw and starts at $150k or so [like other independent federal agencies, the SEC is not on the GS pay scale]. Our office gets a TON of applications for each vacancy and the vetting process is strict. The caliber of candidates is really amazingly high and the ones who have been chosen treat the experience like winning the lottery.

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  2. Yep. And by the way, 17 other cowboys got off the train with you and are looking to do the exact same thing. Even when it rains, an acre of land will only support so many head of cattle.

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  3. Even if you have cattle and that you feed, there are always other bandit cowboys roving around looking to poach your healthiest cattle. If you thought Billy the Kid was bad, wait until you see Billy the Desperate PI Attorney.

    Oh, and the cattle you hauled and cultivated? You technically have no property interest in them, and if the cattle want to go and give steaks and milk to some other cowboy, you're basically SOL. So you must develop the art of coddling them while sending them to the slaughterhouse.

    Remember, kids, neither the sheriff nor the marshal care about your survival in the Old West. They just want their own slice of the pie. Oh, and to make sure your trust account docs are in order.

    Yee-haw!

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  4. Over 20 years ago, during the summer after my second year in law school, I worked for a law firm in DC that was basically a lobbying outfit. All of the partners had strong government connections which they used to make piles of money. Here’s how things would typically work. A partner (who happened to be a former undersecretary in the Department of Transportation) would get a call from a trucking company client expressing concern about some language in a proposed regulation that would adversely affect the client’s business. The partner would call his old colleague (who happened to be a current undersecretary in the Department of Transportation) to meet up for a couple of drinks. Next thing you know, that regulatory language disappeared. And that was it. No need for any tedious legal analysis. And if there was, that’s what associates were for. The trucking company got what it wanted and paid the partner, the firm made money, and the current undersecretary knew that there just might be a place for him with the firm when the time came to leave “public service.” One thing I learned that summer: It ain’t what you know, its who you know

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  5. (to paraphrase) "You need to being in $250k a year so you can pay your office bills and have a little left over for yourself."

    Nope.

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    1. Maybe not $250k, but as a general rule of thumb, you should be grossing 3x your expected take-home, so if you want a modest $50k livelihood, you'll need to find $150k in revenue each year, minimum.

      Jeff, you continually post on here these blanket statements about office economics. Why don't you give us some hard numbers? What do you spend on advertising, what do you gross in annual revenue, what do you spend on part-time help, etc.???

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    2. I refer to my share of revenues and expenses in a 3-attorney firm:

      There is no staff or advertising.

      Advertising: $0.00

      Staff/Help: $0

      Rent: $900

      Westlaw: $170, soon to be lower

      Other software: $50

      Phone: $9 internet line (which I don't like)

      Cell phone: $100

      Office Supplies: Maybe $20

      Internet: $20

      Postage $50

      CPA: $40 (average per month; he charges us about $1,500 per year)

      Based on figures above, my share of total expense is around $1,500.

      I bill and collect $120k. My take home before taxes: $100k.

      Disclaimer: I have cut down on my work a lot over the last year in order to work on another project. However, the above has been typical for the last 10 years previous.

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    3. ^ No advertising or staff, and $120K per year? LOL, is your "office" in your parents' basement?

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    4. I am on the 9th Floor here: http://www.graniteprop.com/properties/property_detail/?bn=8101

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    5. Even if that's not BS, it's not doable for new, young attorney.

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    6. What about life insurance, health insurance, disability insurance, federal self-employment taxes and malpractice insurance, cost of CLE, cost of going to organizations/ meetings where you can network, advance sheets to keep you up to date in your area of practice? In a large city, rent would be much higher and in NYC there is an unincorporated business income tax of over 4% of gross income.

      After you have paid the insurance and self-employment amounts, a job that pays $75,000 as an employee would be equivalent in net take home pay.

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    7. I forgot to mention that in most states, under disciplinary rules, you need to form a partnership or LLC to practice in a 3 attorney firm as partners. Then you have filing fees, both initial and annual. In NY State there is an expensive one-time publication fee as well. Maybe only one attorney is a partner and the other two counsel. If that is the case, no filing fees, but good luck surviving an IRS audit on the counsel being independent contractors.

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    8. According to his website, Jeff is in a professional corporation, so there's also those fees and taxes.

      Having two partners and no malpractice insurance is an insane risk, IMO.

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    9. What PC fees and taxes? I'm in Texas.

      I did forget bar dues and occupation tax. These are $435 for the year, so you can tack on another $35 a month.

      CLE is maybe $200 for the year +/-. Throw in another $20 a month. So, you can take away another $55/mo. from my paycheck if you want. Okay, throw in some books and just deduct another $100 - whatever. Point being - the "3x" gross sales is WAY off.

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    10. Obviously, I do not need anywhere close to $300k in collected billables to take a gross pay of $100k. Not even near that. Nit-pick on me not having malpractice as you wish - we're not even remotely in the ballpark of needing another $180k in collected bills to cover it. BTW, I believe I have malpractice, too. I think it came with our leasehold insurance for about $1,200 a year.

      I am not worried about the pennies and dimes. The assertion was it would take me to collect $300k to pay myself $100k. The myth is now destroyed.

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    11. Also, as noted, I am an employee of my PC; thus, no self-employment tax. My paycheck is what I get as an employee. Maybe I was billing more like $130k. Whatever. You guys have a rough idea. There is no finagling you can do to point out how I have to bill $300k - or even $200k - or even $150k. No numbers will add up, unless you start throwing in junk, like staff. Finally, There is no life, health, disability insurance. My belief was not, "I'm not going to form a practice until I know it will pay for my life, health, disability, golf club, country club, car, 2-weeks vacation, 1-week sick days, etc." Are people here really holding off until the stars align?

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    12. Next year you will need health insurance or pay a penalty on your individual return. Will impact your income. If it is not provided through your business, will be after tax - much more expensive.

      So you don't know if you have malpractice insurance - likely do not - have no health insurance.

      Do people really want to live like that?

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  6. Funny post and comments --jim

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  7. Great writing, RAB!

    The kid from out East might further impress the locals by mentioning that he spent three years at a prestigious Cowboy School learning narratives and critical theory of the American West. He can point out that, even though few of his Professors of Cowboying had spent much time on actual working ranch, they taught him to think like a cowboy.

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    1. Absolutely, the kid very likely was required to read "Pro Bono and the Underprotected: A critical analysis of Bareback Representation" and he's now roping ready. Yippee-ki-yay.

      Ain't enough jobs, buckeroos.

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  8. "bought a few hundred head of cattle and headed out West on a train with cattle cars in tow"

    Wouldn't the cattle already be out West?

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    1. That's the point. Lawyers drop $150k on a law degree first then find out if they can earn a living at the end of the line.

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  9. "You will need bountiful paying clients to have a growing, thriving practice and be able to pay your bills."

    Forget the "growing, thriving." That's outdated. Today, it's being able to pay you bills -- a fight to survive.

    Of course, if it's just the title, 10-gallon hat, and the boots that do it for you, you can skip the profitability concern.

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  10. Weird thing about this is that the people who sold you the cattle want you to be all happy and peppy at their "Alumni Luncheons" and (willfully and annually) fork over bricks of cash so they can name a lounge or some part of the library after you, your family, or "firm." They just don't seem to get it.

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  11. Follow your passion just means "have lots of sex"

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  12. In this picture:

    http://4.bp.blogspot.com/-evyqUOVsAjg/T0KALXncCXI/AAAAAAAABpQ/kM-UZm1dlAU/s1600/Village+People.jpg

    ...you are the runt, the scumbag, the least protected person.

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  13. JeffM's business expenses do not include:

    1) Malpractice insurance.
    2) Various fees that the bar association charges lawyers.
    3) any occupational taxes specifically directed at lawyers. (In CT you have to pay $450 a year in occupational tax)
    4) Litigation related expenses, if you are handling cases such as personal injury that require you to pay filing fees and for depositions.
    5)travel expenses, such as gas and parking if you are traveling out of town on a weekly basis these add up.
    6) I wish I was only paying $20 a month in office supplies, with my computer maintance costs, I'm probably close to $600 a year.

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    1. Addressed above (where it belongs).

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  14. What qualifies you to make any of these points? From what I gather, you have zero experience in "rainmaking" and hardly any real-life experience as a lawyer in general. The biggest tip-off that you don't know what you're talking about is that you're addressing this post to young lawyers in the first place. Any veteran can tell you that clients, especially institutional and corporate ones, don't really send business to lawyers with less than about 10 years of experience. If you're young, you need a senior lawyer bringing the business in, and you can then cultivate that work into future business, at best.

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