Jay Ruane  0:07  

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. Seth and I were talking right before we came on the air today about end games. Not necessarily endgame, but slowing down, maybe you know, rounding third and heading towards home, and the question then becomes: Seth, is there? Are you ever going to slow it down and stop? Like, I mean, you know, I’m sure at this point you could probably walk away from it all. Not that you’d want to, but do you see yourself, you know, retiring to the paddleball courts of Del Boca Vista?

 

Seth Price  0:44  

I guess the look. I got a dad who’s 91, still practicing law. 

 

Jay Ruane  0:48  

Yeah, so you got a long runway, bro.

 

Seth Price  0:50  

Right, right. But then again, I’m not in the thick of it practicing. He loves the substance. He’s a trust and estate scholar. 

 

Jay Ruane  0:56  

Not me.

 

Seth Price  0:58  

Right. Still loves it. But I think what’s great, and I think that technology has allowed us to do this, is that the stuff you and I love doing, which is taking a crazy idea and running with it, is something we can do with a pretty long runway. I think that the grind of doing the same thing over and over again-you know-that’s one of those things that I look. If we can follow the Jay Ruane system methodology, God willing, we become less and less essential. That’s the dream.

 

Jay Ruane  1:28  

That, I mean, that’s the most important thing that I’ve ever been able to do for myself is basically become non-essential to my firm. And, for case an example, earlier this week, I was you know, thinking to myself, I have, you know I have 700 YouTube video bullet points that I want to film, and I want to film them before the end of the year. They’re four to five to six minute videos, just stuff that I know I need to put out there for my firm, for you know, for the LLMs, all that crap, right? And I was talking to my in-house video guy, and he goes, “All right, I got to hire an editor, and I’m like, “That makes a lot of sense. I mean, 700 videos, you know.

 

Seth Price  2:12  

Surprises one, you know, by the end of the year, maybe more than one.

 

Jay Ruane  2:16  

Well, you think that, so I said, you know what? I bet you I could get AI to help me with this. And yesterday, I created an AI tool using a Python script for all the nerds out there, which uses FFMpeg and OpenAI and Claude, and it will actually take the raw video that I create, upload it, download a transcript, identify the cut points. I have a keyword that I have to use if I don’t like a sentence. I say the word banana because it’s not like that’s going to come up naturally in any of my videos. And then it goes back, it cuts it, stitches it back together, and it adds my firm’s logo as a watermark. And I, you know, I’m going to start what you’re saying.

 

Seth Price  3:09  

And look, I sincerely hope it is fully automated and that you don’t touch it. At the same time, what you’re saying is it’s not a multi-person. It’s at very least that one person can handle it.

 

Jay Ruane  3:20  

Well, the great thing about it is, I can now have a clean folder of these videos with a YouTube description and all the hashtags. It’s all created by AI, and then I can have one person watch the video that I’ve cut and give it a thumbs up. Okay, this you know this doesn’t get atrocious, and he could watch it in three times speed, and we could be putting up 20 videos a week by next week. And that means that I’m going to crush these, you know, before the end of the year, I’ll have all my videos done.

 

Seth Price  3:53  

That’s awesome,

 

Jay Ruane  3:54  

And so I didn’t have to hire an editor. 

 

Seth Price  3:58  

Look, as my grandmother said, your lips to God’s ears. Let’s let’s let’s make sure that it looks good, and it’s there. You know, it’s funny because I now, with videos on air, there are a number of people still using the AI avatars, and they’re pretty good, but they’re just at the moment, they’re still slightly off. You know, it’s a, it’s not bad. It’s filler video, but it’s getting what I’ve

 

Jay Ruane  4:23  

What I’ve noticed my friends who do a lot of videos- if they are well polished, if they are perfectly lit, you know, have the underbed of music and all that stuff, no flubs, and and they’ve gotten really good at doing videos, they’ll get comments from people. Oh, this is AI.

 

Seth Price  4:41  

Oh, really?

 

Jay Ruane  4:41  

No, dude. It was really me. Like to the point where they’re like, we’re gonna be have to be Lee Harvey Oswald and hold up today’s newspaper and say I’m a legit person, and today’s video is X, Y, or Z. You know, but I have seen some AI avatars that are just astoundingly good.

 

Seth Price  4:58  

What they say is to pivot. To a continuation of what we started with about, you know, slowing down exits etc. had some data points that I wanted to share with you, which was had a discussion with one of the larger groups that has rolled up firms, and again this is a sample of one. I’ve spoken to probably three or four of them, but there’s a lot. You know, there are seminars on this now. They’re experts. Everybody’s creating their own, you know, their own sub-businesses from their firms, taking out the non-learner. All awesome. But what I got, at least from the guys out of the box so far, was they are not interested in us. You know, these guys are looking at 10, ideally 15 million EBITDA shops. The numbers on the PI side on those large shops are so astounding at 1/3 profitability once you get to scale that it is, you know, it is in a different league than what most of our audience is doing and capable of. Now, will there be people that buy different things? I’m sure, but what I’m seeing is the first early movers that are getting all the headlines, that are getting the 8x valuations, all of that, that we are not seeing that is not like oh Jay’s going to get X because 8x because somebody else got 8x. I am, you know, when we started this, we always looked at law firms being worth three to five; that was sort of the general numbers they sold on, which is why they never sell at three. You might as well just you know…

 

Jay Ruane  6:30  

Lay out the right manager and just walk away, and as I do, let it run for a couple years.

 

Seth Price  6:44  

 I know it was Conrad or Gyi who always said, like, for a digital marketing agency, you know, if you just stopped all employees for a year and had no expense, screwed over your clients, mind you, you would have, you know, that’s your exit. You just churn everything off, and it would go in fumes. Obviously, not being done, but that idea that 8x is attainable, and you’re hearing how people say 10x and this and that. You know, if the largest players are doing the most profitable deals, right? Because the numbers get bigger, they’re essentially at 8x, and every once in a while, this guy Rafi in Arizona had a big press release. He was a 20. It’s a debt deal, completely different than everything else we’ve seen out there. But again, not that there won’t be people out there with private equity, and if Jay is profitable with good systems, but it was really fascinating to see that law firms that worked off of lead gen were not as desirous to many of these groups as groups that had a brand that could be expanded.

 

Jay Ruane  7:38  

Well, and I think that, and I think you know if you’re not looking to exit in 2026, if you’re not looking to exit in 2030, maybe in 2035 or 2040. Like if you’ve got runway in front of you, right? I think the focus really needs to be on building your value in your brand because that may have residual value down the line. I mean, it you know, I could

 

Seth Price  8:18  

I’m cynical. I’m cynical on that. Not that the brand isn’t there. Morgan has brand. There’s no doubt. He’s also estim. You know, just said he was planning on spending 600 million on marketing next year. I am suspicious that the brand that any of us can build, you know, until you get to larger numbers, isn’t really meaningful. As great as Jay is in criminal, if we polled everybody in the state, what percentage know Ruane for criminal? You know, and that was and again I hate to go back to it, but that was what John Morgan always came with. That nobody had more than low single-digit percentage, and he’s like, hold my beer, I’m going to go do it. So, it’s one of those ones that brand is so it’s everything, but it’s also for most people elusive. And you know, I always just had this joke, particularly as I built BluShark, but it could be used in Price Benowitz as well. That whenever we talk about you know, oh, this was for brand; that’s why it didn’t make any money. Now, obviously, brand makes money in the long term. But if I went to a trade show early on and nobody, like, I’ll give you an example of the legal tech show. Everybody’s there, everybody’s busy, everybody’s talking to each other, but no business gets done. I’m being facetious. I know some people do business, but in my world, they weren’t. At least in the marketing space. So it’s good for branding. That’s not untrue, but there’s still also no revenue. So, you know, it’s a fascinating idea that. 

 

Jay Ruane  9:49  

Okay, so let me ask you this then: What percentage of a marketing budget should be devoted to brand and not expect a return?

 

Seth Price  9:57  

That’s…

 

Jay Ruane  9:58  

10% of your overall budget?

 

Seth Price  10:00  

I don’t like my answer because you’re going to say it

 

Jay Ruane  10:03  

Depends, aren’t you?

 

Seth Price  10:03  

Well, I mean, right, and I yeah, because there’s what’s your you know if you’re in year one versus you’re in you know I see guys who have five year exit you know brand shouldn’t be a huge part unless you’re you have brand you’re building up but what is it meaning for most of I mean, what what percentage are you getting from digital? And understand, there’s some brand in there, but it is really hard to, you know, if you look at anything else, if you it’s hard enough to get people to spend money on marketing that has return. In essence, what you’re saying is the brand is deferred return,

 

Jay Ruane  10:42  

Right

 

Seth Price  10:42  

Assuming that’s what you’re saying, and that’s a pretty heavy. You better have a pretty substantial business model that you’re going to flip.

 

Jay Ruane  10:51  

But let me push back on that. Right, brand is what got John Adams the Amistad case. Who he was as a trial lawyer, he didn’t do any marketing. He didn’t do any digital marketing. You couldn’t even market as a lawyer back then. But he was known in his community as an excellent order and trial lawyer. And brand is what brought him cases. Abraham Lincoln got cases. Clarence Darrow got cases. 

 

Seth Price  11:17  

Right, but that’s a timeout. But I’ll I’ll put those using those examples, and I understand the world’s evolve, but I’m gonna I’m gonna stick with that for a second. If if Jay Ruane is branded as the guy, and you’re no longer there, what is it worth? Meaning those cases went to that lawyer after the

 

Jay Ruane  11:36  

The coffin firm. He’s still. I guarantee you, there are people still calling because they don’t know Johnny’s.

 

Seth Price  11:44  

Understood, but that goes back to my theory that unless you get to that elevated level where it has sustainability, and I’ve got to tell you, like a great example, and the people started that are dear friends of mine. I actually took that brand and tried to use it in the DC market. I would argue at this point for them, they have branded something well beyond Johnnie Cochran. We still care about Johnny Cochran. You know, the under-40 crowd doesn’t really have money.

 

Jay Ruane  12:13  

Here’s a perfect example. Here’s a perfect example of that. Okay, and this is and I had no idea we were going this way- but last week I took my son to go see The Book of Mormon on Broadway because he’s really getting into his theater at his high school, and I wanted to you know, have a bonding moment.

 

Seth Price  12:28  

It’s as good as it gets. It’s just short of Hamilton.

 

Jay Ruane  12:30  

And so they have a scene in the movie where in the Broadway show they go to hell, and in hell there are four dancing people. There is Genghis Khan and Adolf Hitler. Now Jeffrey Epstein, right before it was Jeffrey Dahmer, and they’ve changed it to Jeffrey Epstein and Johnny Cochran. Johnny Cochran’s been in the show, and he puts on the glove, and I’m the one who got OJ off. Blah blah blah, and so the, you know, the explanation is those four guys are in hell together, and my son goes, Hitler, Genghis Khan, Jeffrey Epstein. Who’s the other guy with the glove? He’s 15 years old.

 

Seth Price  13:12  

A bunch of stuff. It’s also like a lot of stuff is not aged well. That does you know,

 

Jay Ruane  13:17  

but that like that’s

 

Seth Price  13:18  

How a guy who’s following the single greatest jurisprudence, you know, context out there is put with those guys. Obviously, it’s just a cheap laugh, but the fact that your son doesn’t know him. So I tried using the name, but I was permitted to use the name for criminal defense. didn’t resonate, or if it did, it was people that had no money and thought Johnny Cochran was going to come rise from the dead and get their kid out of jail. Like first of all, he’s not alive. Second of all, he’s really you know, he’s a civil guy. So each of those things, I think, is telling, and I think that we, you know, the greatest thing that all this private equity is showing us there’s a negative, which is cost per case. And I heard one stat that was scary. I don’t know, was that you know essentially one substantial firm that I’m familiar with doubled their spend last year, and in a market that Morgan came into did not get any further cases like stayed even

 

Jay Ruane  14:25  

So stayed even on double the spend

 

Seth Price  14:27  

Yes that’s how much private equity, and you know Morgan is in private equity but it’s his own whatever it is, but we are seeing that much of a change, particularly on that side I have no doubt that they’ll figure it out, you know, for other practice areas. That someday there’s going to be a jingle for a criminal defense firm, a jingle for a family law firm, just like there is for Domino’s or anything else. That was, you know, that and that. But I would argue the thing that you and I have seen, we bemoan more than anything. Else in our discussions with people, our guests, our friends, is the irrationality, non-business sense of much of the micro legal community we’re in.

 

Jay Ruane  15:13  

That’s the biggest problem: they don’t know their numbers, they don’t think to know their numbers, they don’t understand basic visible business concepts. They believe that if I do better work, it’s just going to turn into this magic pixie dust that delivers me cases. They don’t know their cost per acquisition. They don’t know their cost per lead. They don’t know the percentage of wanted-to-sign cases. Like, it’s amazing when I talk to people, and I’m not talking about like solos with a cell phone or the Google face. Who actually, at least the ones that I interact with, are having better. They know their numbers better than you know that that 50 to 60 year old you know six lawyer firm run by one guy who’s got you know two or three you know equity partners, but they kind of just split everything you know when that comes in. Those people have no idea their numbers whatsoever.

 

Seth Price  16:03  

It’s not surprising. We talk about people that graduate law school. There’s no business training. They said if math was involved, people would shut up and not listen to that day’s lecture. You know, and that we are in- you know, look. I remember these life moments where culture became a thing. It was bigger than just me and Dave, and we had to be like, oh my God! And there is a culture. The question is, are you going to control it? One of Bill Biggs’s sayings, and you know, I think the idea that it’s a business, we talk about it, but even being humble, as good as we are, there have been years on the way up. It’s like there was more money coming in than going out. As long as it’s going large, I’m not gonna. You know, there were those, and again, we’ve gotten much more sophisticated. There’s, you know, much more coaching, much more sharing amongst lawyers, and I think, you know, all of the different podcasts and seminars have gone a long way towards that. But it is lawyers understanding those things and the changes. You know, you get, you know, those. There are a lot of guys that were phone book guys. We were internet guys. You know, there are people that have cracked the code on social, and God bless them. But it’s not that it’s you know the idea that you’re going to get the trifecta that you really understand marketing, you really understand business, you really understand culture, and God forbid have good substance behind you. I mean that’s a four-legged stool that most people are not sitting on,

 

Jay Ruane  17:24  

right. Exactly, and you know the thing that’s really interesting to me about this whole thing is that what I see, and I don’t know about you, seen it in the greater legal entrepreneur category, is that you’ll have a conversation with somebody and they say, “I want to get to this spot. I want to have, you know two or three lawyers that are working for me, grinding the work, the right little paralegals. I get my marketing working, and they’ve achieved what they’ve wanted to achieve. And then they’re like, “Well, I’m only really working 10 hours a week. I should scale more. And then they enter that trough period where now they need middle management, and that costs more, and then they’re like, “Oh God, this is not what I wanted. They were almost great, and then they said, “I have nothing else. I might as well scale more. And I think this really goes back to you. Kind of have to really put a lot of thought into where do you want to be. We had a great mastermind a couple weeks ago, facilitated by Bill Umansky. We had somebody get up, and it was like, “I’ve achieved what I wanted to achieve. I’m 10 years out of law school. I’ve got the firm doing what I want to do. I’ve got you know, enough revenue coming in. It’s going up modestly every year to keep up with inflation. Do I need to scale even more? But I’m happy where I am, and that was the thing. Like, well, if you’re happy where you are, don’t just scale for scale’s sake, you know. And I think some people fall into that trap because they’re like, “Well, I’m free. I’ve got nothing else to do with my extra 30 hours a week. I might as well scale. And maybe the better thing for you to do at that point is to get a hobby, have a life outside of law.

 

Seth Price  19:00  

Like, but also we see that in the 20 years I’ve known you, our priorities have changed, our need for money has changed. You know, an extra kid comes along. I mean, you’re like you know your your family vacation is not for the faint of heart. So even if you, you know, it’s again there are different ways to do it. You don’t need to; you can live within different means, but then I think that people, what you think you need at 25, and that vision of oh, if I’m just at that at 35, that that’s that’s great, but is it is that really?

 

Jay Ruane  19:36  

so okay? So then here’s the question I guess, for everybody in the audience: put it down in the comments where you see this. How often do you reevaluate what you want to be when you grow up? Is it something that you should be consciously working on every five years, every three years, every 10 years? Because I think you need to take some, you know, conscious time away to actually. Process this and think about all these different permutations and issues that come in. I mean, I’m of the opinion that as long as I’m still moving, I can be more flexible and make changes. And I mean, you know, because I’m not sitting in one place, I’m not stuck, right? And so if I need to pivot, I can pivot because I’ve already got movement, right? But the question is, how often should you be reevaluating yourself? I mean, how often do you look at? Do you sit down with David and say, “Okay, what’s Price Benowitz of 2030 or 2035? Do you have those conversations?

 

Seth Price  20:37  

You know, yes and no, and I’ll tell you, this is why this has gotten very heavy. In that, look, you’re on your own. You got to do it by yourself, right? And that’s one thing. But when you’re with somebody else, the issue is people don’t always know what they want. And I also know that people who what you see in a mastermind somebody says is not always

 

Jay Ruane  20:59  

Right because that sounds good.

 

Seth Price  21:01  

And so I’m like, I’m a big believer that action speaks louder than words. If you know somebody says I don’t want to be practicing law, many years ago you were saying that, but you were schlepping yourself to court. You talked about the haircut guy that might see you and might give you a case. You know I’m being flippant, but my point is you talk one way, but your actions belied it, and so, and I no different than myself or talking to David. You know, you know he wants things, but you know this guy had kids in his, you know, at like practically age 50. You know, it’s there’s gonna it’s it what he says and what he’s going to do, and then as age gets to you, I mean stuff that like at 40, I’m like now that I’m mid 50s on a good day, you know it’s you know there are different moments. A lot of us have aging parents with issues and mortality, and you’re just you know then these things become, I think, more complicated. So it’s easy to say, yeah, you should obviously should start to have that. Just like you know, for culture, it’s not going to be a one conversation to get culture changed at your firm. I think that what you are saying very aptly is it is something that you should have on your radar because very often we just keep doing things, you know, ad nauseum, right? And that’s not so good a thing.

 

Jay Ruane  22:27  

No, and I think I think, you know, if like, look, I finally extricated myself from the day to day grind of legal work. Could I pick up a file and head to court tomorrow? Absolutely. I have zero desire to do that. I’m willing to take less home every year and put extra bandwidth on my people, have extra people in different roles, because I want to have that sort of flexibility to be able to be like, yeah, I’m not doing it. And but it also gives me the opportunity to be like, hey, I have this idea, like my idea to do the intake training AI that helps my intake team, which which

 

Seth Price  23:06  

You know, and we adopted. Oh yeah, we are disciples of Jay intake training.

 

Jay Ruane  23:15  

Yeah, I mean that’s the thing. Like you need to. I freed myself to have these crazy ideas, which is how I got. It’s good and bad.

 

Seth Price  23:24  

You know, you were mentioning David Hanel before the show. Great friend of the show, and it’s like this is a guy with more crazy ideas, and some of it is figuring out which ones to put the time into and which ones not to.

 

Jay Ruane  23:35  

Yeah, I do with this idea quarantine thing I took from Matt Holman in the non billable hour 20 years ago, I read his blog, and you know I have a million ideas, so I write them down. I tape them to the back of my door, and I come back 45 days later. If it’s still a great idea, I roll with it. But you’d be amazed how many great ideas I’m like, ah, maybe not so great.

 

Seth Price  23:57  

Well, let’s look at you know there was there was one where you know, there was an opportunity for a piece of real estate that could be used for corporate events, right? Be great, and it could make money. But the question is, is that, like theoretically it’s all outsourced? But we both know that starting something takes more of your gumption. I’ll let I’ll leave you with this. So you never know who you’re talking to. So we’re having dinner with another couple, neighbors of ours. We live in a you know, very nice Bethesda suburb, and over the course of dinner, it sort of it peels out that they rent out the empty bedrooms in their house. They’re now empty nesters. Started with one kid at home. They rent it out to long-term to sort of medium-term tenants from the local NIH med schools, things like that. And they get people for, you know, several months at a time. Now there’s other people walking through on your floor. You live on with your wife. There would be other people walking around. You can’t walk around in your underwear. Look at the face. If you’re out watching, Jay is making this crazy face,

 

Jay Ruane  25:09  

Talking to a stranger at 9 o’clock in the morning.

 

Seth Price  25:12  

Not let’s say don’t even talk to him. You just have to pass him. You know what I’m saying? Like so. Again, my wife is you. She’s like, absolutely not. Oh, you know the

 

Jay Ruane  25:20  

Extrovert. You’re like, hey, who knows?

 

Seth Price  25:22  

She doesn’t even want me in the house, right? Right. Exactly. After she likes the travel, is that she gets more alone time. So the idea is that, but conservatively, and they undercharge for what they’re doing to get the tenants they want. They make five grand a month. This guy created a startup, and the idea that that’s 60 grand a year that a let for an asset they already own, that you know, and that each with each thing there we each have our no go lines, and it’s different when you have four kids sitting in the house, but the idea that you know we people do exchange students for no money, you know what I mean. If you get to that point again, you have to like people. But it was just fascinating, and it’s I think that the op sort of the counter side to what do you want to be? This guy said, you know what? I don’t want to work for somebody. I want to create my own business. This was their back door to, I think, allow somebody to go to zero revenue from a paying job in order to launch something.

 

Jay Ruane  26:30  

If that’s your idea, if that’s your run, that that’s your only ability to generate income, then maybe one day

 

Seth Price  26:41  

you know, that didn’t bother them. You know, if you had a side hustle that doesn’t that you enjoy, then great. You know, when it becomes onerous, or somebody really messes up your house. But anyway, it was just a great lifeboat. But I got an idea for a future for our future shows, we wrap up now, which is great because we learn a lot from our mistakes. What are some of the biggest mistakes that we’ve made in scaling the firms? And I think that, you know, every once in a while, we get on a tear at a group dinner. We talk about ex-employees that have harmed us in some way. We don’t have to get that personal could, but what are some of the you know I’ll give you a preview of one which was you know do fractional CFOs move the needle the way you need them to or is it something that you have to you know you need things like that what are things that you thought would work but might not have

 

Jay Ruane  27:37  

I can definitely speak to that fractional CFO thing because I did it 15 years ago, and I made every mistake in the book when it comes to that.

 

Seth Price  27:44  

So, for example, you know, things you’ve taken. 

 

Jay Ruane  27:48  

 I have a laundry list. Exactly.

 

Seth Price  27:51  

So I’m going to give you a week. Your homework this week is to think about those things. We’ll come back probably next week. You know, next week, and we will sit down and sort of think about what what are the things that lessons that could be learned.

 

Jay Ruane  28:03  

Okay, sounds like a plan. All right, folks, that’s going to do it for us this week on the Law Firm Blueprint. Of course, you can take us anywhere you want to go by subscribing to the Law Firm Blueprint podcast wherever you get your podcast, be it Apple, Spotify, YouTube, wherever you can catch us there. Of course, you can catch us live, live on LinkedIn Thursdays 3 p.m. Eastern, 12 p.m. Pacific, as well as live on and in our Facebook group, the Law Firm Blueprint. For that, I’m gonna do it. I got nothing left in the tank. I only got a couple hours of sleep last night. I was up late binging the agency on Paramount Plus. Great show, but it’s very complicated. All about the CIA and all sorts of stuff, but it’s it’s one of these. It’s a show that you can’t scroll social media while you’re watching because there’s way too many pieces. And I decided to stay up until like 330 because I it just kept auto-playing, and I was hooked. They do a great job with the hook at the end of the episode. So, folks, if you want a good show with the agency, make sure that you pay attention because every little thing matters. Seth, anything else? No, this is this is awesome, and I look forward to next week. Awesome, I’m going to take a nap, folks. Bye for now.