Going solo is one of the great dreams luring people to the practice of law. Almost any lawyer you meet will tell you that he or she has thought about it at one time or another. The lure of being your own boss, setting your own schedule and not having to put up with office politics, bureaucratic burdens, and the administrative hassles of someone else's system are a great enticement. But if you’re tired of your present situation and are thinking of making the switch to solo practice, beware: going solo isn’t the answer for everyone, and the grass isn’t necessarily greener on that side of the fence - just different.
When you go solo, you’re trading one set of problems and responsibilities for another. Whether you’ll be happier with the problems and responsibilities of a solo practitioner than you were with your previous situation depends primarily on who you are and what you want.
The benefits of being a sole practitioner are easy to describe. But each benefit comes with its own burden – sometimes more than one. The biggest benefit? You’re your own boss. You answer to no-one but yourself, you get to make all the decisions, and you get all the credit. But you also have no-one to rely on but yourself, you have to make all the decisions, and if you make too many bad ones, you have no-one to blame but yourself. As a sole practitioner, you can set your hours, spend your own money and run your own office any way you want, and take (or turn down) any case you want. It can eliminate a lot of stresses, but it can also create a lot of different pressures.
Since going solo doesn’t work for everyone, here are some questions to ask yourself to help determine whether it might be right for you.
Am I self-reliant and self-contained?
One of the hardest parts of going solo is being alone. Sure, you’ll have other people in the office – your secretary, maybe a paralegal or associate or two, and maybe even other lawyers with whom you share offices. But as a lawyer, you’re on your own. You have all the responsibility for the decisions you make, and no matter how good a network of other lawyers and friends you may develop to brainstorm ideas, celebrate successes and commiserate failures, you’re alone with the responsibility. If this scares you more than it excites you, think twice before making the jump.
Do I enjoy handling administrative detail?
If you revel in the "pure" practice of law and disdain administrative matters, get ready for a big shock. Administrative tasks will take up a great deal of your practice. Most lawyers can delegate these tasks or ignore them, and for some matters you can too. But for the most part, you have to know how to handle them yourself, or closely supervise the person to whom you have delegated the jobs.
Most of the disciplinary and financial troubles that befall sole practitioners come from neglect or mishandling of administrative details. You have to know how to calculate payroll taxes, when they’re due, to whom they are paid and what happens if you don't. You have to know how to hire and fire people, what insurance is required, and myriad other employee-related matters. You have to know how a bookkeeping system is set up, and what kinds of safeguards are necessary to prevent mistakes. You have to know how to rent an office, select the equipment for it, and set it up. In short, you have to be half small-business person and half lawyer.
You can hire staff and outside consultants to help you, but ultimately it’s your responsibility to make sure everything’s done right and done efficiently. Remember, the cost of the mistakes comes tight out of your pocket. If you think running a small business might be fun, solo practice might be for you. But if you resent anything that takes your attention from the "pure" practice of law, you probably won’t be happy going solo.
Do I have good "street smarts”?
Being a good lawyer won’t automatically make you a good sole practitioner. You need to have the "street smarts" and common sense to know what cases and clients will benefit your business and which ones will hurt it. The fact that people may ask you to represent them and take them on as clients may be flattering. However, if they’re a bad credit risk and you don’t spot it, you might end up doing a lot of work for free and not being able to pay the bills as a result.
You also need to be able to spot trends in the marketplace that may affect your business. For example, if you plan on setting up a plaintiffs' personal injury or workers' compensation practice, what’s the risk that an insurance reform measure may put you out of business? If you’re going to engage in real estate transaction work, what will happen when the market nosedives? If your practice is going to be heavily dependent on one client, what will happen if that client takes his or her business elsewhere, or suffers a business failure?
As a sole practitioner, it’s not easy to jump from one practice area to another – building up a new client base and referral sources for a different type of work can take a lot longer than your cash lasts.
Can I sell myself?
Some lawyers are natural "rainmakers" to whom clients seem to flock; others, who may be equally talented, don’t feel comfortable promoting themselves. There was a time when just doing good work might have been enough to guarantee a sole practitioner sufficient referral work from other lawyers to assure a successful practice. But the legal marketplace has become more competitive, and as a sole practitioner, selling yourself is essential to survival. Unless you’re comfortable with the idea of selling yourself and your services, sole practice is going to be difficult for you.
Do I have a high tolerance for risk?
As a sole practitioner, you have to live with every aspect of your practice, 24 hours a day, 365 days a year. There will be times when business is not going well, and times when there’s not enough money to pay the bills. But after investing in going solo, it might not be so easy to just quit and go get a "real" job.
Not only do clients depend on you, but there are often long-term financial commitments on office space and equipment leases. When things are down, you need the fortitude to keep on going, and the objectivity to evaluate your situation realistically, determine whether changes are needed, and then implement them and hang on until they take effect.
If the thought of losing everything you own brings on a state of panic that prevents all rational thought, you’ll probably find it difficult to handle the inevitable business crises that face every sole practitioner. But if you handle adversity well, you’ll be able to weather the bad months and quarters, and keep on going to enjoy the good times that make being a sole practitioner so rewarding.
Adapted from Flying Solo: A CBA Guide to Solo Law Practice in Canada.