Law and Technology
There are endless reasons not to start a law firm. Think about it.
After all, you have no experience, no paying clients, stiff competition from alternative legal service providers with massive marketing budgets and worst of all, a very real fear that people may actually know that you feel like you don't have the slightest clue what you are doing.
Most people would be hard-pressed to name another profession where an otherwise bright individual (you did make it through law school, sit for and pass the bar exam, after all) would look at the current state of his or her industry, see the bleak outlook, and move forward anyways.
So how are you going to use those challenges to your benefit?
As an attorney, you have acquired the ability to think about practically anything from multiple perspectives. In the field of law, two sides can look at the same set of accepted facts and draw two entirely different conclusions based on perspective. I'm a big fan of the television show, Dateline. Dateline has become mostly an investigative and true crime show typically showcasing hour long real life murder mysteries. One of the most frequent themes seen during an episode is police officers confronting a suspected killer (usually an ex-lover or spouse) with news that their loved one has been murdered. Often, the reaction by the unsuspecting interviewee is central to the question of guilt at a subsequent trial. Prosecutors and police very often point to subdued reactions as an indicator of guilt, the logic being that anyone who finds out that someone they care about has been killed will react in an outburst of forlorn emotion. Of course, those that react with such raucousness are also pinned as murders who must just be "putting on an act." Meanwhile, the defense views such reactions very differently. Perhaps the lover was so overcome with shock that the surreal news produced no emotional response. Or, naturally, for those that do react with an outburst of tears and desperate screams are reacting as one should react to hearing such life-altering news.
The point is that the undeniable facts of the situation can be interpreted in two entirely different ways depending on the lens through which they are viewed. As an attorney, you can probably see both sides of that coin. After all, it's your job to take the facts of any situation and use them to your client's advantage.
The ability to take that skill and apply it to building your business is going to be essential to your success. Just like a good prosecutor or defense attorney faced with a client's taped reaction in a murder investigation, you need to take the facts of your situation—whether real or perceived—and make them work to your benefit.
For example, maybe you’re afraid that a potential client, when facing a choice between you—a newly minted attorney without much more than some mock trial experience and a summer internship at the District Attorney's office under your belt—and Joe Lawyer—who has practiced civil litigation for 25 years and successfully negotiated dozens of cases to six and seven-figure settlements—would never realistically chose you over him. But, that lack of experience does not have to be a negative. Instead, maybe it can mean that, unlike Mr. Lawyer, you have no preconceived notions of what the process should be. A settlement may not be in your client's best interests. Mr. Lawyer may know that he can take a quick paycheck by getting out early because he has handled a similar case before. To him, it’s an open and close case.
Meanwhile, because of your lack of experience handling that type of case, you know that you are going to have to spend countless hours poring over statutes and case law to build a working knowledge of the issues involved. During your research, say that you find a rarely seen exception to the law that means your client will easily win on the merits if the case goes to trial, meaning a much higher payout for both you and your client.
The very lack of experience that you were viewing as a negative has all of a sudden turned into one of your strongest traits. Not knowing the law led you to uncover a way for your client to win big. It led you to see the case as a unique set of facts and circumstances while custom fitting a solution to those facts and circumstances.
Your lack of experience isn’t a weakness. It’s a strength. It enables you to represent clients without any preconceived notions of process or outcome.
What about the lack of paying clients? Clearly, your business is doomed to fail if you don't have a steady flow of new business coming in. And, in the beginning, taking on a new client is probably going to feel less probable than winning the lottery. Trust me, I've been there, and it gets better in a hurry. But until it does cash flow will be limited for a time as you get yourself established.
Unfortunate? Sure. But, look at it through a different lens. Without much technical legal work to do, you have ample time to focus on business development. You have the ability to spend your valuable and limited time perfecting your product and your delivery. What makes you stand out from the crowd? What's your angle? Akin to developing a prototype of a new invention, which can be tested and tweaked until it is the best it can be and ready for sale, you are going to need time to test and perfect your product. Honing what you have to offer future clients will give you the foundation you are going to need to survive long-term.
It’s not a negative, it’s a positive.
Lack of paying clients merely frees your schedule so that you can focus on developing a product that paying clients will want to use and recommend.
What about the lack of a steady stream of income? While it obviously may seem bad, try looking at it differently. Right now your funds are limited which means that you're going to need to maximize every dollar you spend, whether on advertising, software, networking or even paying for your personal needs. You simply don’t have the luxury of wasting a single cent. That’s going to force you to think about what expenses are essential to the operation of your firm. It's going to force you to cut out everything that is unnecessary to running a successful business.
Lack of money enables you to stay lean and able to adapt to changing market conditions.
What about all that competition? After all, you're not the only one out there practicing in your area of legal specialty. Stiff competition in a crowded industry may mean fighting harder for each client. But, it also means that there are countless other lawyers and firms from which to learn. Look at the firms that have been around for 100 years. What do they do that is so effective? What about the lawyers that have weathered the storm and figured out how to make it five or ten years on their own? How did they find their footing and how do they distinguish themselves from the masses? There is competition in every industry. Embrace it and make it work for you.
Lack of a client base, lack of income, and stiff competition can all potentially unhinge your fragile business before it gets off the ground by stomping you down mentally. But, viewed through a different lens, they can create an ideal environment in which to build a new business. It's all about perspective, and by turning negatives into positives, you are going to give yourself and your business more than a fighting chance to succeed.
To read more, check out Solo out of Law School | A "How-Can" Guide to Starting a Law Firm as a New Attorney
Solo out of School is a book for both law students thinking about a solo career and attorneys looking to open their own firms. It's about mindset, motivation, and viewing your solo career with perspective that allows you to see yourself and your work as something you can be proud of. It's not a "how to" guide to starting a law practice. It doesn't say anything about the tools you'll need or whether to open a brick and mortar office. Rather, it's a "how can" guide to developing the mental toughness and right mindset to succeed as a solo attorney. It's a collection of little lessons and simple reminders for when your choice to go solo in the first place come into doubt. Solo out of School is about finding the strength and motivation to keep pushing. By embracing the words on its pages, my hope is that you'll realize, no matter how much you doubt yourself or secondguess your actions, you are good enough to be successful as your own boss.
*The following article appeared in the June 2016 newsletter of the ISBA Standing Committee on Legal Technology.
Virtual Law Offices (VLOs) have become more common in today’s evolving legal industry than ever before. As technology has become more prevalent, internet access more reliable and software as a service (SaaS) programs more developed to make various aspects of legal practice simpler, the VLO model has developed into a relatively simple platform on which solo and small firm providers can remain competitive in an ever-changing legal marketplace.
An assumption can be made that, by now, the vast majority of practitioners are generally familiar with the VLO concept. At its simplest, a VLO permits the attorney to interact with clients completely online through technological means. This removes the need for a brick and mortar office and the costs associated with one. Or at minimum, it creates a complementary alternative to an already-existing brick and mortar practice. VLOs also give lawyers increased flexibility to work from practically anywhere at any time. Cloud computing, storage and software enable the attorney to essentially “bring the practice” on the road with him to anywhere with internet access. For clients, that portability often means lower costs due to lower attorney overhead, enhanced accessibility to an attorney no matter where he or she may be, and increased flexibility to work on a schedule that fits his or her lifestyle.
While the definition can vary depending on who one asks, most VLOs share at least some of the same characteristics. Frankly, most firms today probably incorporate at least a few aspects of “virtual” practice without even realizing it). Whether it is the use of cloud-based document storage or a SaaS accounting platform (QuickBooks, for example) most firms incorporate at least some measure of “Virtual” functionality into their operations.
For the pure VLO practitioner, technology is front and center in all law firm operations. But, VLOs can be characterized by any number of characteristics including, a) lack of a traditional office space, b) a secure web-based client portal with unique client login credentials, c) cloud-based document storage and access, d) SaaS accounting, billing, invoicing, bookkeeping, and calendaring functions, e) video conferencing capabilities, f) real-time document collaboration, g) unbundled, limited scope or “a la carte” legal services, h) web-based phone and fax services, i) virtual secretarial and back office support, and j) minimal in-person contact with clients.
Benefits of Incorporating a VLO into an Existing Practice
Operating a pure VLO is not for every practitioner, but incorporating some virtual characteristics into an existing brick and mortar firm can create new opportunities for client interaction and increased growth.
VLOs offer a number of benefits to both the client and the attorney that include extensive geographical reach, lean operations and operational flexibility, and increased efficiency. Attorneys can use VLOs to potentially reach areas or clients previously unavailable due to geographic restraints, scheduling difficulties or a disconnect between the cost of legal services and perceived client value in the traditional model. For example, an attorney licensed in multiple states can establish a traditional office in one state and use a VLO to offer limited scope legal services to clients in other states without necessitating boots on the ground. Or, an attorney whose target market is busy professionals—people who may be hard-pressed to schedule consultations or case reviews during normal business hours—can use a VLO to engage clients remotely in the evenings or on weekends.
Potential pitfalls to consider
While they present ample opportunity for firm growth, VLOs carry some inherent risks and drawbacks. Naturally, there are limitations on the types of services the firm can effectively provide. For example, drafting and negotiating a contract would be a more appropriate project for a VLO practitioner than attempting to represent a client in a criminal case.
There is also the challenge of effectively differentiating the VLO from other legal industry disrupters like Legal Zoom and Rocket Lawyer. While attorneys are no doubt familiar with the inability of those companies to offer anything more than template documents with auto-populated data fields, the average consumer of online legal services may not necessarily be aware that the DIY model that those companies implement is not backed by any attorney review. It is important for the VLO practitioner to ensure that the client understands that difference and the obvious value inherent in working with an actual attorney.
Finally, when offering limited scope services through a VLO, attorneys must be mindful of potential ethical traps. Limited scope representation is permissible if reasonable and the client gives informed consent. So, it is imperative that a VLO practitioner ensures that the client is aware of exactly what is and is not included in the representation. For example, if the attorney is drafting a trust for the client, the attorney may want to ensure the client is aware that he or she will be responsible for valid execution of the document and funding of the trust. Engaging in comprehensive consultations, using clear engagement letters, and giving potential clients ample opportunity to ask questions can ensure that both practitioner and client are on the same page.
VLOs are becoming increasingly more popular as technology continues to evolve. From pure VLOs that serve clients entirely online to hybrid models which incorporate some virtual characteristics into traditional law office models, these new alternatives to classic brick and mortar practices offer attorneys, both new and old, a means to stay competitive in an ever-changing legal environment. By exploring how VLOs work and what they offer, practitioners can ensure they stay on the forefront of legal service delivery.
The cloud, while often intimidating to attorneys, has become a hot topic for law firms looking to stay on the forefront of technology. Terms like cloud storage, cloud computing, and Software as a Service (SaaS) add confusion to the definition. But, generally speaking, the cloud refers to an interconnected network of servers, systems and hard drives that enable a user to store and access data from multiple devices and locations (For a comprehensive overview of working in the cloud, see Ed Finkle’s article, “Legal Technology: Feeling Secure in the Cloud” in the January, 2015 issue of the Illinois Bar Journal).
Numerous applications and programs exist that enable a user to access that data in specific ways and for specific purposes. For example, common practice management platforms, like My Case and Clio, are cloud based applications that enable an attorney or even an entire law firm to manage its entire presence on the cloud and without the need for owned physical servers.
Document storage platforms, like Dropbox and Spider Oak are highly popular cloud-based document storage platforms with which most attorneys are familiar. They enable lawyers to store and share documents with clients or opposing counsel who can then view the documents anywhere with internet access- whether at the office or the local coffee shop.
A common thread amongst the vast majority of cloud applications and storage platforms is that the physical servers which actually house the data you have sent to and stored in the cloud are owned and managed by someone else. Whether it is Amazon Cloud Drive, Google Drive, iCloud, or something else, when you send data to the cloud it is being sent to servers owned and operated by a third party. For example, a lawyer that uploads a draft of a contract to his Dropbox account and shares it with a client is actually sending a copy of the file through Dropbox to a physical server owned and operated by a managed service provider. While now accessible by both the lawyer and the client wherever each has internet access, the file itself (or the copy of the file) does not simply fly around the ether like some intangible idea. It stays parked in a secure physical space on a physical server. That creates the potential for data breaches and, in turn, ethical breaches of client confidentiality. While the cloud offers tremendous advantages over traditional physical servers by way of accessibility, sending secure data to some unknown location can lead to unease for the attorney concerned (and rightfully so) about maintaining the confidentiality of his client’s confidential information.
So, where is an attorney that wants the convenience of cloud storage but the security of onsite physical storage to turn?
Well, one option is to set up a private cloud server solution. Most attorneys are familiar with the concept of a Virtual Private Network (VPN). A VPN is a network that uses public infrastructure to establish a private network and enable authorized users to remotely access files and data. Various mechanisms are employed to add security to any exchanges occurring over the network. But, VPNs can carry a number of disadvantages from cost and complexity of setup to ease of use.
Luckily, a company called Transporter (www.filetransporter.com) is taking some of that complexity out of the equation and now offers an alternative to traditional private network infrastructure.
Transporter is a private cloud solution that enables users to enjoy the same benefits of traditional cloud storage services like accessibility, sharing capability, collaboration and data backup, but it carries a significant benefit over its public counterparts. Transporter allows a law firm to keep sensitive data under its control. Instead of storing data and documents on remote third party controlled servers by using a public cloud storage platform, like Dropbox, a Transporter user can store data in a secure location, like his office, while retaining the ability to access those files from anywhere with internet access. Just like Dropbox, a user gains access to the Transporter using a unique set of login credentials.
While the largest of the Transporter devices resembles a small server, some of the smaller options are no larger than a computer speaker and can sit right on your desk.
How it Works
Unlike traditional cloud storage services, like Dropbox and Google Drive, which store your (and your clients’) sensitive data on public servers, Transporter stores files locally where they are under your control. There are two options for storing files. The first option is the Transporter Library. Storing files to the Transporter Library is akin to storing files directly on an external hard drive. Users on the Transporter network can then access Library files directly from their own computer, tablet or other device. So, for firms with multiple users, Transporter ensures that every member of the firm is always working on the most recent version of a document by automatically syncing to one centralized location using the Library storage method.
The alternative to Transporter Library is Transporter Folder. Instead of being stored directly to the Transporter, files saved through the Folder method are kept on the user’s computer and automatically synced with the Transporter. The added benefit to this method is that Transporter can effectively serve as a library backup for all important firm files. Additionally, the Folder method alleviates any risk that network downtime could lead to an inability to access files when needed.
Law firms are continually wrestling with how to protect client confidentiality while improving efficiency and accessibility in an age of ever-increasing technological dependence. Solo and small firm attorneys lacking the resources of larger firms are forced to search for new ways to run their practices better and smarter. While cloud-based applications, and specifically cloud storage services, have provided realistic options for storing large amounts of data, the security risks involved in using such services can be substantial. For those firms increasingly worrying about those risks, personal cloud devices like Transporter may prove to be the answer.
Michael F. Brennan runs a virtual law office helping clients in Illinois, Wisconsin, and Minnesota with estate planning and business issues. He can be reached at firstname.lastname@example.org with questions or comments, or check out his website at www.thevirtualattorney.com.
The information contained herein is intended for informational purposes only and is not legal advice, nor is it intended to create an attorney-client relationship. For specific legal advice regarding a specific legal issue please contact me or another attorney for assistance.
As an estate planning attorney, I find myself working with clients to protect certain aspects of their financial life at a very high level, meaning, that while we work together to establish the framework that ensures the client and his or her family will be taken care of should something happen, I don't specifically deal with the financial vehicles involved in helping folks grow their assets during life. That's where the financial advisor comes in and why guys like Brian Plain are great to have on your team.
Brian is a financial advisor in Oak Park, Illinois, but like me, he is continually striving to make financial planning more efficiencies and more convenient for his clients through the use of technology. He focuses on lifestyle planning of which the goal is to have an ongoing relationship with a select group of families and individuals to help them identify, achieve and maintain their desired lifestyles from a financial perspective. Through our conversations, we have found a lot of overlap in the way we approach our professions and the way we look to help our clients take the worry out of life.
So, this past week I joined Brian on his podcast, The Alternative Advisor to discuss estate planning, small business law and technology and how we as advisors, while in different professions, can collaborate to ensure our clients are taken care of in life, and in death. Here's the link to the podcast as well as Brian's website.
I often speak to other attorneys about virtual law offices and how to incorporate some of the benefits of this model of legal service delivery into their own practice. Perhaps not surprisingly, I am frequently asked by friends, colleagues and others what makes my firm different than a traditional law firm. I thought I'd share a small slice of what us virtual practitioners mean when we say that we operate "Virtual Law Offices". As you'll quickly see, there's no "one-size-fits-all" mold that we all fit into. Instead, we operate our firms based on the belief that the utilization of technology creates flexibility for us to serve our clients for a much more reasonable cost than traditional law firm models while maximizing accessibility and convenience for the client.
Virtual Law Practice permits the attorney to interact with clients completely online through technological means. This removes the need for a brick and mortar office and the costs associated with one. The virtual law office also gives lawyers increased flexibility to work from practically anywhere at any time. Cloud computing, storage and software enable the attorney to essentially “bring the practice” on the road to anywhere with internet access. This in turn means: a) lower costs for clients; b) enhanced accessibility; c) increased flexibility; and d) high-standard legal service not otherwise seen online with businesses like Rocket Lawyer and Legal Zoom.
Virtual Law Offices can be defined any number of ways depending on who you ask. While technology plays a central role in their operation, the reality is that most, if not all firms are operating, at least in some sense, “virtually”. Whether it is the use of cloud-based document storage or an SaaS (Software as a Service) accounting platform, like Intuit QuickBooks, most firms incorporate at least some measure of “Virtual” functionality into their operations.
A 100% Virtual Law Office incorporates multiple virtual functions into a law firm model that enables attorneys and support staff to access essential firm functions, documents and client files at any time and from anywhere.
Virtual Law Firms commonly possess most, if not all, of the following characteristics:
► Lack of a traditional office space
► Secure Web-based client portal with unique client login credentials***
► Cloud document storage and access
► SaaS Accounting, Billing, Invoicing, Bookkeeping, Calendaring, etc.
► Video Conferencing and real time document collaboration
► Electronic signature capabilities
► Web-based phone and fax services
► Virtual support services
► Minimal in-person contact with clients
Virtual Law Firms offer a number of benefits to both the client and the attorney. These include:
► Extensive geographical reach
► Lean operations and operational flexibility
► 24 hour accessibility to files and records from anywhere with an internet connection
► Scheduling flexibility
► Minimal operational expense and low overhead which can be converted into more attractive client pricing
► Client flexibility to work with the attorney from their home or work during traditional or non-traditional work hours when it fits into their daily routine