Jay Ruane  00:00

Hello, hello, and welcome to this edition of the Law Firm Blueprint. I’m one of your hosts, Jay Ruane, and with me, as always, is Seth Price. Seth, it’s been another week. How you doing this week?

 

Seth Price  00:16

I am doing great. And Jay, this this I went to Clio a couple weeks. 

 

Jay Ruane  00:20

I like that you’re doing great. 

 

Seth Price  00:22

I’m doing great, but I got something. I got something for you. You have always professed hiring people right out of school, and I’ve been the guy that says no, third to eighth year, right? And I know you’re coming along to my world. The problem is, and we’ve talked about this, there is an elephant in the room. We cannot get the same high quality people third to eighth year that we were getting a decade ago. It’s not there. And this is not to say, oh, it’s not the way it used to be. There are definitive economic things. Covid wiped out a group of people that would have gone to law school but didn’t want to pay $200,000 to study on Zoom, right. We’ve had other options in the tech world that I think have pulled people away and entrepreneurial options online that have pulled people away from law school. And we have also seen with loan forgiveness programs that people that start in the government starting in year three become stickier, and that by 10 years, they’re locked in and they may not leave, and that we are losing people. 

 

I interviewed a guy I loved the other day. Ninth year, oh, I still want to come like I don’t even want to. Why should I spend any words I could I’m playing for a year from now, at best, you’re telling me you’re going to give up nine tenths of $200,000 of tax free, loan forgiveness, like, if you’re coming here, you’re not a rational player, and you should piss off. That’s the level we’re at, right? And so, whether they tell me, or I tell them, or whatever, so what do you do? Because I’m not getting, like, right now, if I could hire two or three criminal lawyers in Virginia, if you’re listening $5,000 bounty, anybody listening to this show, that gets me a viable criminal lawyer in Virginia with skills third to eighth year or more that will actually be able to produce for it like, that’s the level that I’m at. Like, I have 20 different recruiters working on it in that type of scenario. That said, yeah, what is next? And I met Clio, and there are a number of scaled family Lawyers anywhere, ranging from 12 to 60 lawyers in their firms. And what are they doing? They’re creating summer programs. 

 

They’re going back to the big law model, where they’re bringing in as many crazy ones, as many as 50 people a summer. Some are 20. Some are 12, and they are bringing people through. And they’re not always like these are not hobnobbing like I went through with lunches and dinners. This may be a six-week internship of sorts, where people are being trained, and it gives them a bunch of stuff, right? It’s, to me, one of the biggest factors: does somebody actually want to do this type of law? Do they have work ethic? Do they show up and all of those things, and turning it into a numbers game. Can you bring enough people into the funnel where at a cost effective rate? These are people in, you know, southern states where minimum wage may be $7 where they’re literally six weeks at $7 an hour. You go through a program. It’s also weeding out the people that really want it. You’re getting trained. They see if you want it, then they get 50 cents on the dollar. The people that started it, that might might start day one. How many make it through the first month or the first quarter? I don’t know. But the idea is, it’s a numbers game to put butts in seats first. What do you think about this? And am I? Is this? Is this? Am I? Am I crazy to be thinking this way? Or is this going to be a necessity, because we’re not getting people trained the way we want them ready to go?

 

Jay Ruane  04:12

Well, I mean, I think there are a couple of factors. I saw a headline recently. I don’t know how accurate it was, but it seems pretty accurate that last year, about 18,000 students registered for the LSAT, and this year it was like 36,000. So I think there was a dip, but I think there’s a lot of people in college now thinking, “oh, maybe the law isn’t a bad profession if it’s, you know, if I can avoid getting displaced by AI,” but they’re a couple of years off.

 

Seth Price  04:42

A couple of years off. But there’s, there’s also like, like, that’s not, it’s people hiding out during an economic downturn of sorts. I mean, I’m DC, people are being riffed, meaning fired daily. They’re not getting paid right now. Like, government work is not what it was cracked up to be before, where you could get fired at any moment. It that was used to be job for life.

 

Jay Ruane  05:03

Yeah, I like the idea of having a class and a, you know, a pipeline of people. If nothing else, if you’re doing it, even if you don’t find somebody who can fill your seat, think of that as having 20 other lawyers that know you. Know your operation, you may want to refer your business if they go into insurance, defense law or PI or criminal or whatever.

 

Seth Price  05:28

You’re definitely expanding network, but it’s a lot you wouldn’t do. You wouldn’t put this much effort out for that. I mean, that’s why we do what? No, but you know what? It’s funny. You know we’ve had, you know, it’s a lot of work, but you’re right, everybody that we’ve had within the people, you know how people love law students, but they hate lawyers. Anybody who’s clerked for us is stayed on as a raving fan. People may leave as an associate and go somewhere else, and, you know, have mixed feelings about a firm, but for the most part, the people during law school who are there. It’s a stepping stone. It’s their first professional experience. There’s a lot of positive mojo that comes from it. So I love it. To me, I’m sitting here in this.

 

Seth Price  06:10

Here’s the problem. 

 

Seth Price  06:12

yeah

 

Jay Ruane  06:13

Here’s the problem that I found with hiring people right out of law school. Your mileage may vary, our listeners, mileage may vary, but here’s what we have. We have people, generally speaking, who did four years in high school, then everything changed. They did four years in college, then everything changed, and they did three or four years in law school. So they are programmed to expect a massive change at around the three to four year mark, it change in their living conditions, in where they go and hang out. It’s not something that’s necessarily, you know, they’re making a conscious decision. But what I have found is that at the three and a half year mark, you get people who are great employees, who are trained, who like their job, coming to you saying, I think I got to look elsewhere, because it’s time for a change, and because their mind and their body is used to things changing every couple of years. And they also say, I don’t want to necessarily be at one firm for my entire career, and I can see myself just not ever changing. So I need to change and bounce, and like you’ve told me in the past, you’ve got some people in that role who were not necessarily very qualified for their salary when they started, but after two or three years from you now they’re exceptional because they’re doing it right. They know how to handle things. You train them well, and so now they can get pulled up by somebody else who says, I don’t have to do any of the hard work of training them.

 

Seth Price  07:47

I have an ego enough to think that the financial model, particularly what I’ve talked about on the show the 25-25-50 trues that up. The issue is when we talk about law clerk is 25 bucks an hour. Graduate, 60 pass the bar, 65-70k and all of a sudden they’re worth 110. If your financial model makes it so that they can’t be pilfered for money, that goes a long way. But if you’re keeping them in that 70 and they’re at the end of the year, oh well, they’ll make 85 at the end of the year, there’s more risk. So the question is, can you true them up? And you know what I’m seeing. I am seeing like we, part of us has to just grow up. We used to think that 60 was a viable number for an

 

Jay Ruane  08:31

entry level. Two was a viable number for the longest time, 1000 bucks a week when we started right.

 

Seth Price  08:38

And I think that the dirty secret is, and it. The analogy I have. I talked about this on the show. I wanted to start an international staffing group that did, like pre-lit paralegals or other highly trained paralegals, intake, what have you that could come out trained. And the problem was there was a cost to doing it. You had to pay somebody something, even if it was a training wage. You had you to get them there, then you had to place them, and somebody had to pay you for that. And the question is, would they because if it’s you know, how long would they pay you? It is a risk, the person would leave the person, you know, under a contract. And so I think it’s similarly that we need to start thinking about. And I think I am, and I think you have too. We’ve grown up over the years that a first year is not 60 or 70,000 but past the bar, with basic training from you, it’s 100, and it’s a loss leader for you for X period of time, and that it’ll get there. And like that, you that the delta that we were leaving was, in of itself, problematic, and that we, even though they’re not worth 80 or 90 in those opening months, if we don’t pay that, they don’t bought like we need to somehow make up that gap and pay the people that matter so that they stay. And the ideal is it’s on a percentage. So that you’re because we aren’t smart enough to remember, you get somebody at 65-70, they’re smiling at you every day. You know if, if their revenue is three, is 36,0 that means they’re at 80, and it automatically trues it up as they’re making more money.

 

Jay Ruane  10:18

Let me ask you a question, though, because I’ve always thought about this, and I think it’s time to talk about it. You have an attorney. They get the 50,20, 25,25 that’s their that’s their split, and they close three out of every 10 clients that come in. So they’re happy making their money, but you’re spending a lot of money on seven out of those 10 leads that never convert. And if you had somebody who was better at sales, trained at sales, even if you put the lawyer through some sort of sales training, God knows that they’re going to actually apply it in that type of thing. But how are you ascribing to them a cost of getting the leads in, because if I could only convert one of 10, and I’m happy, you’re not going to be happy spending all that money on nine out of 10 leads that don’t convert.

 

Seth Price  11:17

Life right now, like we’re becoming one person, like everything you just asked you have to remember is literally what we’re going through. So what have we done? We’ve added in an attorney salesperson upfront. I’m not smart enough to figure out the non-attorney. Someday, you’ll tutor me. We’ll figure that out. But we’re leaving it. We’re not even taking that off their plate. We realize, as you pointed out, that for our weakest salespeople, it’s better for us to pay for the salesperson, not even charge them for it and deliver it signed. right, A. B, for those people who were trying to sign it, we had to come to a, come to meeting where we were like guys, like everything we we track now our numbers, our data, so much better than it used to be. We are able to say, what is the time? How long does it take for an attorney to speak to somebody? So if we can sign it ourselves, great without them, God bless and we have, we have a great signing attorney. But the stuff that does go to them, some of the more complex stuff, or whatever it is that gets to the lawyers, how long before they get to it. And we had two lawyers that were shitting all over it. To your point, we’re paying for marketing, stuff’s coming in, and they’re signing and both were making us decent money. And Dave had a conversation to the team and said, Look, guys, you gotta return calls. That was more than that. It was one of the attorneys who was ghosting the staff for three days at a time. You know, weird stuff, right? Stuff we’ve all seen and like, look, you’ve got to return the calls. Bottom line, you return the calls. You that three out of 10 is directly proportional to the response time of speaking to people. Even if they’re terrible at it, they’ll sign more responses. Then if they’re really terrible, then we move to somebody else. But first, let’s just get response time up. Don’t ignore phone calls because they’re gold. You know what happened? That’s part of the reason I’m talking summer program, two of the people. Thank you very much. And it was like, You know what? Like, they didn’t hit our core values. It sucks. I’m now talking about, how do I staff? But at your very, very point if somebody, and it’s true, whether it’s response time for signed clients or whether it’s response time for potential clients, if it’s not there. So everything you just said is exactly what we are currently struggling with, which is, I’m putting a band-aid on it by having people who love signing people and taking it away from people, but whatever I do leave with those attorneys is a risk factor. And so we’ve seen who the people are that we love that may not be great signing on the phone and using the signing attorney and for the people that you know, for some of these people, were like, No, this is our bar. And you know what? It sucks because we’ll have slightly dipped revenue in those jurisdictions for a little bit. And again, if you were a solo you probably can’t do that, because if you have one or two people, and you lose the one or two people, but you got 50 people, if I’m down two people, I’ll make up. We just signed another. We signed one. That’ll come in. And is it ideal? No, but there are people who start okay and drop on response time. But if you measure one thing on PI, it’s the percentage of wants. But what I’ve started moving towards is the percentage of answered calls and then percentage of first time. Close, first call, close, those that order of magnitude on PI in criminal what is the time between the first speaking to the person that has a need to the seller speaking to them, if it’s if it’s minutes, that’s great. If it’s an hour, that may work, because criminal is not You’re not going to get stolen from it an hour, maybe you will, most likely not, but if you wait 36 hours,

 

Jay Ruane  14:54

Oh, you’re not happening. Well, I’ll tell you right now. I mean, I’m stealing every client from all the lawyers in the state of Connecticut who wait. Like, I’m just, I’m snapping up that business, I’ll and I’ll take it because, you know, we staffed intake seven days a week, and it’s made a huge difference. You know, we,

 

Seth Price  15:11

we, you know, we’ve been seven to 11. We’re about to push beyond that. You know, we meet with each piece, and we’re trying to put a total pivot. We want to finish this because you’re that question is everything we’re thinking about. Look, you know, next episode, let’s talk about AI answering. You know, where we’re at with that, what you’ve tested, what you like, but to sort of land the plane on this topic. It is, it is everything. Response time is everything. And when you, you know, if you’re having lawyers close stuff, which I have for the last 19 years. What we’re finding is some lawyers just don’t know what it is.

 

Jay Ruane  15:47

I mean, think about it. If my plate is full this week, if I am exhausted from the clients that I have, and it’s now Thursday, and I just log through Monday, Tuesday, Wednesday and half of my day, and now you’re putting a lead on my desk, and I am comfortable with what I make, and is there an incentive for me to close more work and put it on my desk when I’m burned out?

 

Seth Price  16:10

Great lawyers, the great lawyers that we have, that’s not a factor for them. They have it in their DNA. But that said, it goes back to the law school thing. I’m not getting those people out now look at all the factors I’ve talked about. The same DNA is not coming out of law school, at least to me. And maybe it’s because those same person there with the shrinkage of law, they’re now at big law and have a whole different game that they’re playing. Maybe I don’t know, but what I am seeing is I am now having to account for people that are fine in the courtroom but can’t close, or maybe it’s some of the Jay Rayne theory that don’t have that same drive. They certainly don’t have the same drive. And so that I’m pushing myself to Band Aid it, but account for it, right? I could keep hitting my set against the wall, but I’m like, Hey, I’m getting people out. I’m losing the people that I want with experience, because they’re not leaving the government that normally would pivot, right? And so here I am trying to have to do a workaround, which is, I’m going to get people that are perfectly fine lawyers, but they’re not going to literally, we just a person that we are recently just parting ways with a perfectly fine practitioner. No complaints. We said, “Hey, your response time is very low. And in our world where it’s rural, they spend a lot of time in their car. Why are you not calling people back while I’m driving? I can’t speak to somebody while I’m driving,” and I’m like.

 

Jay Ruane  17:39

That’s the perfect time. 

 

Seth Price  17:41

I got one guy who’s been with us for over a decade. He is a maniac. He does not waste a minute of call time in the car, and that’s where he makes his money, driving between courthouses, driving home, every minute of car time is where he gets close and like, you can’t teach that, you can’t teach hungry. And so if I don’t have that, if somebody isn’t that, you know the right answer is, you know what? I don’t want to reward that. But here, here’s your sign stuff, go to court, make us both money.

 

Jay Ruane  18:19

Sounds like a plan to me anyway. So folks that do it this week, here next episode to preview

 

Seth Price  18:23

I want to talk about AI voice.

 

Jay Ruane  18:25

Okay, let’s do it. Alright, folks that’s gonna do it this week here on the law firm blueprint. Of course, you can take us on the go anywhere you want to go by subscribing to our podcast. And for people who are in our Facebook group. You know, it’s been a system that I’ve posted for years. As of today, I am going into our Facebook group and I’m going to post an AI prompt to create with AI a practice area book that you can have created, like 250 to 200 page book, all written by AI, that you can have and you can give to clients, no matter whether your practice areas, bankruptcy, criminal, PI, family law, trust and estates, whatever business, business law, whatever it is, pop into the Facebook group. Make sure that you leave me a comment on the AI prompt. I’m going to put the prompt up in one of the comments, so you’re going to have to get there, so you can copy it, but this way we can get more engagement going in our Facebook group. I’d love to see you there. I’m Jay Ruane. He is Seth Price. Thanks for coming to the Law Firm Blueprint. Bye for now.