Why Full Service Law Firms Are an Inviting Investment for Non-Attorneys
Many people think that non-attorney investment in law firms is not an attractive financial opportunity when it comes to full service law firms, but I think that there are potentially very interesting possibilities in this area for law firm profits.
The normal concern is that because these firms currently distribute all their monies each year to the partners, any firm that would cut into this amount to drive investor profits would be at a competitive talent management disadvantage. The countervailing response, however, would be that there are many reasons why talented attorneys may prefer to work at non-attorney owned law firm. In particular, the leverage model that requires ever increasing numbers of hours has created a quite dissatisfying work experience for many lawyers at full service firms, with little time for a personal life, community involvement, and pro bono activities.
By utilizing knowledge management, document automation and process improvement, alternative firms could attract excellent attorneys who are willing to compete on a flat fee model, under which hours are not important and productivity is vital. As a result, these attorneys could likely out compete traditional full service firms by offering higher quality work for a lower, budget friendly set price, with faster turnaround time. Certainly, having myself been a client of these kinds of firms, I would much prefer a firm with this kind of an approach, which provides greater client value while at the same time driving increased law firm profits.