In Business, Everything Has a Cost

Adventures of a Gen Y Solo Practitioner

There has been much discussion about how simple it is to start a law practice, or any other business for that matter, from your kitchen table with only a laptop. Recently, Joseph Brown, a solo lawyer and minimalist, wrote a great article about the MicroFirm:

“a law practice consisting of one person concentrated on one practice area and operating with monthly operating overhead of less than $300.”

I absolutely agree that this is a great way to get started since that is exactly how I got started – on my couch with my four year old laptop and an internet connection. My startup costs consisted of the initial payment for malpractice insurance. I did not have a website nor business cards but I did have three paying clients so I am not one to poo poo the MicroFirm.

However, I do think its important to point out the following:

In business, everything has a cost.

Using an old laptop that gives you trouble every now and then has a cost. The cost is lost time that could have been spent working and the ensuing frustration that prevents you from being creative. Working from a space that is not conducive to maximizing your creativity and productivity has a cost. In my home office, it takes me at least 10 hours to get 7-8 hours of work done due to the inevitable personal life distractions that invade my business life.  And in my case, I’ve taken steps to mitigate this ‘expense’. I am in the midst of negotiating a lease for office space as I write this.

Not purchasing software that makes work flow and management efficient has a cost. Not having staff that can handle certain time consuming tasks has a cost. I recently invested in virtual law office software which has definitely helped me streamline my work flow. And now I absolutely cannot wait to hire a virtual assistant to do some of the things that it drives me nuts to do.

As solopreneurs, we are the lifeblood of our companies. Our finite amount of time, energy and creativity is our company’s greatest asset and without it, our companies do not exist.

I talk with many young entrepreneurs who are unwilling to invest money in the operations of their businesses, whether it be the cost of hiring a lawyer or buying insurance. Many of us young lawyers and entrepreneurs are willing to invest all of our time but are scared to invest our limited funds. The irony of this is that our time is just as valuable, if not more valuable, than our money.

(Note: I know some will say that most of us young entrepreneurs and lawyers truly don’t have the funds to invest in our businesses but I question that since we seem to always have the funds for the latest Apple gadgets. $500 can go a long way in your new business.)

Sweat equity is not necessarily a bad place to begin down the path of entrepreneurship. However, we must recognize when we have reached capacity and begin to use money to build a team around us to pick up the shortfall and spur productivity…and this team can and usually does include technology.

I have heard more than one venture capitalist say that they will not fund a solo entrepreneur. Venture capitalists expect that solo entrepreneurs will eventually fail without a team.

I am not suggesting that all young lawyers begin hiring assistants and paralegals today. What I am suggesting is that it is important to invest in a “team” as soon as you can. A mastermind group of peers, an accountant, law practice management software and dedicated workspace designed in a way that helps you be as productive as you can, may, and dare I say, likely will, lead to additional client development and therefore greater profitability. Isn’t this a significant reason for our efforts?

Carolyn Elefant asked a thoughtful question last December that no one seemed to answer. So I will ask it again and hope that you’ll answer in the comments below:

How far will you go if you don’t grow?

Is your frugality costing you money? In what ways could you spend money to increase productivity and profitability in your practice? Do you want your practice to grow beyond you? What are you willing to invest to spur such growth?

Shout out to @pamslim and @charliegilkey for teaching me all of the good stuff (and none of the bad stuff, that’s all me) that is contained in this article.

All opinions, advice, and experiences of guest bloggers/columnists are those of the author and do not necessarily reflect the opinions, practices or experiences of Solo Practice University®.

This entry was posted in Guest Bloggers, Inspiration, Solo & Small Firm Practice and tagged Rachel Rodgers. Bookmark the permalink.

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13 comments on “In Business, Everything Has a Cost

  • What if you don’t have that $500 for a new apple gadget? What if you are struggling to reliably make your mortgage payment each month?
    Truth is there is an awful lot you can do at your local court library.

    • You can still afford help if the budget is tight, Vincent. Consider contacting the Career Services office of your local law school or your alma mater about hiring an unpaid law clerk to take some of that research off your hands. Some students will work for free in exchange for some mentoring and the chance to put a law firm on their resume. Most of the time they can work remotely in their school law library and during the school year if the work load is not too heavy.

      Also, look into your state’s bar association benefits. Most states offer either FastCase or Lois Law for free online research.

    • You can definitely get started and operate for several months on a shoestring. I did. But its important to realize that being on a budget does have costs to your business. So when you do make money from your practice, reinvesting it in creating a team and a small office will likely lead to faster and greater profitability.

      On an aside, I also think there are times when you need to make sacrifices for your business. I, too, had a mortgage when I started my practice (and still do) but I rented out my house, moved to a smaller apartment and traded in my luxury SUV. That was what was required for me to make it work.

      Lastly, as Suzanne pointed out, there are tons of ways to get by on very little in the beginning, it requires more effort, but it can be done.

      • Great point! Sometimes the best solutions require sacrifice, which most people are unwilling to do because it’s uncomfortable. My wife and I have replaced our vehicles and have moved in with family in order to launch my practice this year.

  • Great article, Rachel. It seems that we always have either more time than money or more money than time. While many “solopreneurs” (I love that word!) may struggle with paying the mortgage each month, there is indeed a price that they pay in terms of efficiency and productivity when they try to do everything themselves.

    I recently hired part-time help for clerical and data entry work, as well as a friend and former paralegal to help automate forms and procedures. It has already paid off in terms of efficiency, which has meant an increase in my billable work, and eventually it will mean I can charge more for what I do because I can do it better and more efficiently than my competition.

    I am VERY interested to learn about your virtual law office. WHich vendor did you choose (message me offline if you’d rather not say here)? How is it working for you? Is it worth the expense? I “rolled my own” virtual office, combining tools integrated into my website and Clio’s document sharing and invoice automation. I am currently evaluating whether to buy a canned system or hire a developer to revamp what I wrote, so I would really appreciate your insights.

  • Agree. Excellent article. I work from home, too, and there are always interruptions, especially during remodeling.

    I’d also suggest hiring non-legal personnel to help, like an accountant. Cash flow is an issue in the early going, but a good accountant can help, and is well worth it. A good accountant is super helpful in setting up your firm, too, as he/she can quickly identity what kind of incorporation you’ll need. It took a 10 minute conversation v. the couple weeks I had spent looking stuff up. Talk about a time saver!

  • Great article Rachel! I’ve been running my virtual legal assistant business for over two years now – on a shoestring and at home. Definitely there are non-monetary costs that people don’t usually get when they tell me how awesome it is to work for myself from home. I think it’s great to start out as minimally as possible, but some upgrades and alterations are going to be needed when business picks up!

  • For my sanity’s sake, I opened my solo practice (now a bit over 8 months old) with an office. With the kids, etc. at home I would not be productive. One bonus to when I opened up was that I had 13 years of practice under my belt and has some clients that went with me.

    Either way, each purchase or expense is subject to a cost benefit analysis.

  • Rachel,

    Thanks for this thoughtful and very balanced piece. There is much to be said for starting small and bootstrapping. The days of the venture capitalists writing million dollar checks to college students with no business plan are gone, as are the days (well before your time!) where lawyers believed that you couldn’t start a firm without a $30,000 lease, a secretary and an associate.
    But much as working largely from home served me well when my kids were small, I do believe that there are many benefits to having a formal work space – either in one’s home (I’ve known several lawyers with full, multi-room offices in their basements) or outside – where you can have people work or have colleagues come to hang out. When I had office space, I always had law students working for me, and they got a lot done for not very much. Plus, when you have the bandwidth in place, you come up with ways to use it. I often hosted lunches in my office space for colleagues, or assigned students to work on pro bono cases or marketing matters. When you rely on contract labor, psychologically, I think that you are less likely to to pay money out to have someone write a white paper or help research blog posts. When the person is already on staff, even part time, you come up with ways to keep them busy, which in turn, moves your firm forward.
    I have lots of concerns about solos who focus only on forms and unbundled services and do not offer anything bespoke. I think that now, lawyers on the cutting edge can gain an advantage by using tech to provide forms and unbundled services that are superior in quality to Legal Zoom but at cheaper rates. But forms are getting cheaper and cheaper all the time, as technology is getting better. I have no doubt that within a decade, much of this service will be provided by large national shops, powered by offshored labor – and a tiny firm that offers nothing by forms and unbundled services will not be able to compete. While I love the idea of online practice of law, how many exclusively online companies are mom-and-pops unless they offer something bespoke? But that is a rant for another day.

  • I’m not a lawyer but the principles are the same. The truth of the matter is you can afford to hire help WAAAAY before you would think. I personally employ two web designers, two copy writers, and a pair of sales representatives for different projects.

    I’m still an undergrad, my parents don’t help me, I don’t earn more than a typical undergrad with a full time job, and I pay it all out of pocket. The way I do it is by outsourcing tasks like SEO writing to develop backlinks to my website, design and lead conversion optimization, and direct phone sales campaigns to other countries.

    You can get employee’s to do great work at really affordable rates on sites like and

    I also have a fax line for less than $6.00 per month.

    I have website hosting for less than $72 per year from

    I purchased a pre-designed website template from for $45.00.

    I get email marketing for free from

    I use a free virtual phone from which redirects to my cell phone.

    I get my design done for $10-$15 to design logo’s and business cards.

    There’s lot’s of ways to scale, and often the most effective methods are on the path less traveled. I can run a business from my bedroom for less than $300 for the first year. If I choose to, I can employ people oversea’s to answer my phones, respond to email, and sell my company’s services for less than $700 per month.

    I agree growth is imperative, but the money required to employ solid people oversea’s is small, the only challenge is taking time to interview all the people that don’t fit with your standards.

  • A great way to dip into building onto your solo practice is by hiring a virtual assistant on a project basis for a fixed fee. When you work with them on a few projects you can see how their services might fit in with your practice needs and how you could transition into hiring someone part-time.

    How fast and how much you grow also depends on what the attorney envisions as the goal for their practice. Right now I actually put a cap on expanding my practice because my children are young and I have other responsibilities besides my career that take precedence. I work with other virtual law offices that are opened as a way to ease out of their firms and into a slower paced solo practice. It just depends. Personally, I have a strategy in my ever-changing business plan to increase my hours and business when my kids start attending school longer. In the meantime I am focused on building my reputation of providing individualized online attention to parents, especially parents with special needs children, who need estate planning. A lot of this is more through client referrals but that’s because I’m choosing not to invest in the expense of online advertising right now.

    I will agree with Carolyn that for solos we can’t focus strictly on unbundling legal forms, but will have to create more niche practices with unique services and build our reputations on those. We would drive ourselves into the ground attempting to compete with these new “branded networks” of online legal services (Rocket Lawyer being the newest one) and the increasing number of solos themselves opening VLOs with similar practice areas. The marketplace is going to demand a hybrid of unbundled services with full-service or unique niche services in order for solos to survive if they want to deliver legal services online. You seem to get this, Rachel, by providing great education content for your prospective clients through blogging.

    Another option for growth for solos might be to consider forming networks of VLOs that pool resources but retain the independence of the solo practice. I’m not talking about a VLP or Rimon Law model, but a network of solo practitioners within a state. I’m working up a plan for this and will probably write about it on in the virtual law practice course blog soon.

    As always, Rachel, you write a good thought-provoking post.

  • Great piece. I’m looking to start a practice myself with my two sisters after my results come in this may, and I love when I see others taking that leap and conquering the legal field one client at a time. Best of success to all of you.

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