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- [00:01]
Tyson Mutrix
Are you tired of the marketing guessing game? Does your website feel more like a digital billboard than a client magnet? If you're nodding along, you're not alone. And it's time to stop the uncertainty and start getting real results. Let's talk about your marketing spend. Are you just shelling out money every month and crossing your fingers? Do you ever wonder what impact your marketing is really having on your revenue? Well, it's time to take the guesswork out of the equation with Rise Up Media. We've been working with them for over a year and, and the feedback from our fellow members has been fantastic. Rise Up Media is here to take your marketing to the next level. They'll even perform a full audit of your online presence, giving you the good, the bad, and even let you in on what your competition is up to that you're missing out on. And the best part, there's no obligation, no catch, no pressure. If you decide to work with them, their contracts are month to month. That's right. No long term commitments tying you down. So what are you waiting for? To learn more about how Rise Up Media can transform your firms, visit riseup media.com max law and rise is spelled with a Z. Riseupmedia.com max law.
- [01:20]
Jonathan Hawkins
This.
- [01:21]
Tyson Mutrix
Is Maximum Lawyer with your host Tyson Mutrix. So, Jonathan, you've represented hundreds of lawyers and law firms as their outside general counsel. So what led you to focus exclusively on helping law firms with the business of law?
- [01:44]
Jonathan Hawkins
So, you know, my dad is a lawyer in a different city, but he's the one that sort of led me down this path. And so at the time, so I grew up as a business litigator and I was doing a lot of business, divorce work for closely held businesses. And my dad down where I grew up on the Gulf Coast, I think in the span of, you know, three years, did like five law firm breakups. And he just said, you're already doing this sort of stuff. You should just look at it because Atlanta is, you know, 10 times bigger. And so I started looking at it and sure enough, they're going on all over the place. As you know, if you do this long enough, you've seen it. A lot of people probably been through it, but there wasn't really anyone in Atlanta that had sort of staked the flag and said, hey, this, this is my area. And so I just started down the path and that, that was sort of the, the seed of it. So I had to sort of learn it all, market it. I was doing some pro bono work for friends and then and and just built it from there. That probably started about 15 years ago.
- [02:46]
Tyson Mutrix
How did you learn the business side of things? Like, is that something that you grew up, like, studying or you watched your dad do? Like, how did you learn that, that side of things?
- [02:54]
Jonathan Hawkins
I've always been entrepreneurial, so, I mean, I was selling candy as a kid kind of stuff. I loved it. My undergrad degree was industrial engineering, which is really sort of like a business engineering degree. So I took all the accounting classes and statistics and that kind of stuff, some finance classes, economics. So I always was interested in it. And it just so happens that law is sort of the business I went into. I didn't give that much thought, I'll be honest about that, but just sort of fell into that. But, yeah.
- [03:24]
Tyson Mutrix
So if you think about a law firm that's like, just starting out, even if it's like a solo or like a small firm, what systems do you think that they should have in place from, like, day one to make sure that they've set themselves up for success long into the future?
- [03:37]
Jonathan Hawkins
Well, you know, you got your, you know, the basics. You got to have your bank accounts and your ielts, all that stuff. But, you know, you got, in my opinion, you got to know how to get clients or at least have a plan to go get clients. You know, some people leave a firm and they bring clients with them that'll last you maybe for a little while, but then you're going to have to go get it. So if you have no idea how to do that, that's the first sort of system you got to learn, and lots of different ways to do it. I'm sure you've talked about it with lots of people, but that's the first thing. And then, you know, from a legal standpoint, I think the number one thing you should get right is your client retainer agreement. You know, that that sets the stage for everything going forward. And there are things you can put in that that will protect you in case you ever need it. And then, you know, there are also other things you can put in there to set expectations with the clients. You know, there's lots of things you do with it and I sort of viewed as a first line of defense in case something goes sideways later. And depending on the state, you know, there are certain provisions that might be enforceable in one state that aren't in another. And that's the other thing I'd say is I've looked at a lot of those, and somebody will put a provision in there thinking, hey, it's A contract, but not going to be enforced, might even be unethical technically. So you got to be careful with that. But really spend some time on that agreement. I'd say right at the beginning, because if you have a law firm, you're going to have clients. Got to get that straight.
- [05:05]
Tyson Mutrix
You know, one of the thing I hear about since I'm, I'm in PI, I mean, I hear about a lot of other horror stories where firm owner hires an associate, they assign cases to the associate, and it doesn't have to just be PI, but you see a lot in PI where associate leaves, takes a bunch of the clients and then, you know, wants to screw the owner over when it comes to the fees. Are there any protections you can put in place either from, you know, a retainer agreement with the client perspective or from some sort of employment agreement where you can help protect yourself as a firm owner?
- [05:40]
Jonathan Hawkins
Absolutely.
- [05:41]
Tyson Mutrix
I want to hear about these. I think this is something that people would love to hear about.
- [05:45]
Jonathan Hawkins
And if you're a PI firm owner, this is 100%, you have to do it. If you hire any kind of attorney, whether it's of counsel contract, you know, partner put in the partnership agreement, or an associate, for sure. As everybody knows, you can't really have non competes or non solicits with lawyers. Clients always get to choose. And so if an attorney leaves, they have a right to sort of go to the client, say, hey, do you want to come with me? But all that in place, if you set up your agreements the right way, at a minimum you will protect your downside. I have a variety of these agreements that I've done for firms and sort of on a spectrum of really aggressive to maybe less aggressive. And I've had situations where we've rolled them out at a firm and the associates just, they get scared. I'll just say they sort of lose their mind a little bit. And so there's some educating and sort of some things you got to do. But the funny thing is, is fast forward some years later, I've had some of those associates who've later left and started their own firm. When they're hiring associates, they come back and say, I remember that. I want one of those too.
- [06:56]
Tyson Mutrix
Damn right.
- [06:57]
Jonathan Hawkins
So, you know, in my view, you know, it's, you're just trying to be fair. This is not about being unfair from an owner's perspective. I know a lot of associates would think, hey, this is not fair. But you know, the owner has put a lot at risk. They spent a lot of money to get These cases, they've trained up these people and it is one of might be one of the biggest fears of any personal injury firm owner. And it's, it puts you in a weird spot because most people want to grow, but if you don't delegate to other attorneys, it really hampers your ability to grow. So at some point you're gonna have to be able to do it. And so absolutely put these in place. We can go through some of, some of the strategies if you want.
- [07:40]
Tyson Mutrix
Yeah, I want to hear about like what are some of the strategies and you don't have to give me your best stuff, you know. But like what are some, like some good ways of like what are some of the strategies?
- [07:47]
Jonathan Hawkins
Well, yeah, well certainly, you know, you want to put a fee split, sort of agreed upon fee split in place if they leave. Now I've seen some where someone sort of self drafted it and I look at it and it says if you leave, you are prohibited from taking clients. That's not enforceable. It may feel good, but it's not enforceable. It may say if you leave and take clients, 100% of the fees you get from those clients you got to pay us, that's not going to be enforceable either. And so there are cases around the country and it differs a little bit per jurisdiction. But if you go too high on the percentage split that has to be paid back to the firm, courts will say that's a financial penalty, it's the same as a non compete. So we're not going to enforce it. So there is a range above which if you get it, it's probably going to get thrown out. The way I like to do it is to create sort of a schedule. And so the. It's not on a per case basis, but it's really or not on a blanket for all the cases, but it's on a case by case basis. Depending on some. There's a couple ways you can go at it, but you're attempting to approximate the amount of work that was done at the firm versus after the firm. So you could sort of set the benchmarks or the schedule by procedural posture of a case by time that the case has been at the firm. There's different ways you can go at it, but the fee splits, you gotta have that in place at the beginning and that sets your sort of bottom, you know, worst day I think. And I can ramble on about this forever but you know, most states have the ethics rule about fee splits and you have to disclose to the client and all that Kind of stuff. When it's dealing with attorneys that used to be at the same firm that are now separating, you don't have to go through that process. So you don't have to go to the clients and say, hey, this is what we're doing. You can have a contractual agreement, and as long as it's reasonable enforceable, the courts will say, yeah, we're going to, we're going to go by that. So that's, That's a biggie.
- [09:39]
Tyson Mutrix
I like the idea of using procedural posture of the case as opposed to, like a time just because you're also. You're kind of incentivizing them to, like, sit on the case for a while to, for them to get more money. But if you do the procedural posture, like, they've got to do something on the case. They can't just, you know, I mean, unless you may just like, filing a lawsuit or something like that.
- [09:59]
Jonathan Hawkins
But like, well, it's more about the time that it's been at the firm before they take it.
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Tyson Mutrix
Gotcha.
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Jonathan Hawkins
So if they've been sitting on it at the firm, it's gonna, it's gonna work out for you, probably.
- [10:09]
Tyson Mutrix
Yeah. Okay. Gotcha. So that makes sense. What are some things. So this is kind of changing the subject a little bit, but what are some things that firms don't do? Like, what's one of the big things that firms don't do when it comes to a legal protection standpoint that you think that they should be doing?
- [10:27]
Jonathan Hawkins
Oh, man. There's a lot, a lot of nuance in this, and there's a lot of little strategies that I've helped firms with over the years that sound really small, that could have a huge, huge impact. So here's a quick example, particularly for bigger firms where you have lots of attorneys, let's say you have 10 or more associates. When it comes to malpractice renewal time, there's always a question that says, are you aware of any claims or potential claims? And oftentimes the owner checks no because they're not sure or they don't think there is anything. Maybe they go around the office and ask. Maybe they send an email and hopefully get accurate, true responses. Although I've been in situations where we created sort of an annual survey and people lie. Sometimes they get. Some of these attorneys, they don't disclose. So then we upped up the ante and we turned it into a sworn sort of document. They have to, under oath, say, yeah, I'm not aware of anything. And for the longest time, we thought that gave the owner cover for coverage, potential bust of coverage. But then I had a situation a while back where let's get a little technical about sort of the insurance policy itself. But because one of the attorneys was aware of the claim that knowledge was imputed to the firm, even though the firm didn't know about it, he had lied on the forum. And so the firm lost coverage or potentially lost coverage. Luckily we got rid of the case. But I learned in that instance there is some sort of exclusion rider. You can get that sort of severs that imputation of knowledge from an individual attorney to the owner. And so that for a bigger firm, that's like one of my top recommendations. Now, I've told other people about it, they've talked to their broker, and no one's heard of this. It's crazy. No one's heard of it.
- [12:20]
Tyson Mutrix
Wow. You, as the owner, need to go to the insurance company, say, I need this specific writer. Is there a name for it or is it just you should tell them what you're looking for? There may not be a name for it just.
- [12:30]
Jonathan Hawkins
But, you know, I think it's called, like, prior knowledge exclusion. I can't remember what it was called, but I've told people that name and they've asked and they're like, I don't know what that is. And so then I show it, show them what it looks like. So that's, that's crazy. You know, you would think, I mean, these brokers are nice people and they're not trying to screw you or anything, but they just don't know. And frankly, I didn't know until I came across it, you know, a while back, a couple of years ago. So now it's, it's something that, you know, everybody really should get. And I don't think it adds, I mean, maybe it adds a little bit to the premium, but I don't think it's de minimis.
- [13:06]
Tyson Mutrix
Yeah. I mean, worth it. I mean, that's, that's, that's. Especially when you're dealing with multiple associates that, you know, you know, you're not touching all the files all the time. I mean, that's just.
- [13:17]
Jonathan Hawkins
If you had a, you had a death case and a malpractice on the death case and the car came back and said, yeah, you don't have coverage. I mean, that's, I mean, big.
- [13:25]
Tyson Mutrix
Yeah, that's a big deal. Wow. Let's shift gears a little bit. And for firms that they grow quickly, I mean, sometimes it can cause some infrastructure problems. So what are some Signs that you've seen where maybe the firm is growing maybe a little too fast. Faster than what? The infrastructure. Infrastructure is built out to keep them scaling safely. So what are some of those signs that, that you see? We're like, oh my gosh, they're, they're going a little too fast here.
- [13:56]
Jonathan Hawkins
Yeah, that's a problem I think every law firm owner faces. I mean, it's sort of the balance of, you know, you put a lot of money in the marketing, but you don't have the back end to handle it yet. And how do you balance the two? But I think if you start getting a lot of complaints from clients, you know, everybody gets the Google reviews now. You start seeing a spike in really bad Google reviews. You started getting complaints saying, nobody's calling me. That could be an infrastructure issue. It could be that you just got a bad pod or whatever. But that would be something I would look at. And obviously if employees are complaining, you know, definitely want to, want to look into that. But that is, I mean, huge issue and you got to be ready. And the other thing is, you know, I'm sure you've talked about this a lot on the show, but, you know, many, many lawyers think the solution is to spend more money to get more leads, when oftentimes it's the intake in the back end that really needs sort of shoring up. And it might actually be more cost effective to do that first.
- [15:05]
Tyson Mutrix
Are there some simple ways of shoring up the intake in the, in the back end that are like, just like really simple to do that. It doesn't cost a whole lot of money that just, it's things, there are things that just need to be done that would, that would help shore those things up.
- [15:21]
Jonathan Hawkins
I mean, I think. Well, first thing I'll say, I'm not an operations expert. That's the first thing I'll say. So they're planning plenty of people out there that are intake specialists. I'm not one of them, but, you know, the first thing I think is you gotta have your numbers. You gotta know, you know, do you have a leaky bucket or not? And if you're not tracking the right numbers, then you just, you just don't know. And I've heard plenty of stories, personal stories from attorneys that believed they were signing 90 plus percent of their cases. And then when they really started looking into it and running the numbers and seeing it, they're like, holy crap, it's more like 50 or 60%. And, you know, I've heard some really, really compelling case studies where people really came in and worked on the, just the intake without increasing any marketing spend and their, their case volume, you know, significantly, significantly went up, you know, 50 plus percent just from that. And I don't know what they did. I mean, they explained it, they told me. But, you know, again, I'm not the, I'm not the intake expert.
- [16:27]
Tyson Mutrix
Sure. So I want to ask you about, about partnerships and some advice. I, I've, I've gone through a partnership breakup. It only lasted 18 months, but the breakup period was like seven days. It was like, pretty quick, actually. We, we had a pretty easy breakup. You know, it wasn't like, you know, we weren't fighting for months. We weren't fighting over money and stuff. So it was kind of. I, I got lucky. But some advice that I. Early on, and I can't say I really heated the advice completely, but the advice I got. And I wonder what your thoughts are on this. But the advice I got was plan for the breakup. And I, and I hated thinking about it that way. And that's where, that's why I can't say we heeded the advice completely. Now. We did. I mean, we, we, we had, we had all the documents put together and everything else, but I think that maybe that's what made it so easy. But it was, I think, more of his, you know, he was reasonable, I was reasonable. That was, I think that had more to do with it than the actual legal side of things. I wonder if you agree with that, that perspective, though, where you, you plan for the breakup.
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Jonathan Hawkins
Absolutely. That's the key. That's the key.
- [17:34]
Tyson Mutrix
Yeah. Okay. I think I figured.
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Jonathan Hawkins
Yeah, I call it. I don't say plan for the breakup. I say you've got to lay out all the exit ramps. You know, there, there are multiple ways someone can leave a partnership or a partnership could, know, dissolve and, you know, death, disability, retirement, somebody leaves all sorts of ways they can leave. And you want to lay all that out in the partnership agreement. But, you know, the way I view it, it's. It's not necessarily that it's going to be a contentious breakup necessarily, or somebody's leaving to steal the cases and go compete. That, that, I mean, that happens for sure, but sometimes it's just the visions change. I mean, somebody, they're just tired of working, They've, They've made enough money, they want to go enjoy life, so they just start coming in two days a week, and the other person says, no, that's not what I want to do. I still want to bust it and so then these resentments can build. And it's, it's, it's hard to put that back when people are sort of going different directions. And it's not necessarily that, you know, they did anything wrong, but these sorts of things just happen. I mean, they just happen, especially in partnerships that have a big age gap. I mean, it's, I mean, just obviously somebody's going to hit sort of the end of the road sooner than the younger person. But even when you're similar in age, it's just your vision for what you want to do, your work ethic, all that stuff may be different. So you need to just have a plan in place for what it's going to look like. And the way I say it too is you put all this into a partnership agreement, and it's sort of the fallback. If you can't, you can always negotiate something different at the time. But if you can't agree, then at least you've got an agreed upon sort of fallback of how you're going to deal with it.
- [19:29]
Tyson Mutrix
So I'm glad you brought up the whole idea of like the, the older attorney, younger attorney, because you see a lot of times where either an attorney brings on an associate and they like the net, the natural next step at some point is to make them a partner or they, you know, they want to kind of get out and they want, so they want to bring on them as a partner to kind of have them take over the, the firm. What sort of steps should they take from, you know, a strategic standpoint, a legal standpoint, to make sure that one, they protect themselves as a business owner, but then also to, to make that, that transition in a way that benefits both sides.
- [20:13]
Jonathan Hawkins
So this is a, this is a rabbit hole here. This, this could be a full day podcast on this topic alone.
- [20:19]
Tyson Mutrix
Oh, okay.
- [20:20]
Jonathan Hawkins
And so it's, it's an art, not a science. I'll start with that. And it's, I've seen all scenario. I do a lot of this stuff too. And so oftentimes an older attorney says, yeah, I want to hang it up and I want to give it to you, but they really don't, you know, they, they can't let go. And part of it is their identity is just caught up in practicing law. So they may go to the young attorney and they may mean it. They say, you know, I want you to take over in a couple of years. And then a couple of years go by, they're like, just a couple more and then a couple, you know, and so that sort of situation can be a big deal. And I sort of tell that story because I think at a very important part of it is the person that is sort of stepping back and letting somebody else take over. They have to, in their mind, be, be ready to let go. They have to know what their next chapter is. And if they're not there mentally, no matter what you do, planning, all that kind of discussions, it's just never going to work. And if you make promises and you don't keep them, the young attorney is going to leave and then you're really, really screwed. I've seen some situations where the older attorney doesn't have anybody to hand it off to and they really want to and they've been looking and maybe the person they thought leaves and so they're stuck without anybody. So I mean, there's lots to talk about there. But you know, from my perspective, the best advice I would give is really, you know, think about it as soon as you can. Don't wait till six months before. I think I was on LinkedIn today. Somebody asked that question, I think a minimum three years. You gotta, I think, but ideally you'd be thinking about it from the beginning. So, I mean, Tyson, you've got, you're young, you could be going a long time if you want. I mean, you could hang it up if you want to probably. But now's the time really to think about it because the decisions you make and the way you design your firm now can have outsized impacts 10, 15 years from now. And that includes sort of, you know, lead generation, your ops, who you bring in, all those sorts of things.
- [22:28]
Tyson Mutrix
You know, that it's, you say that I, I've been intrigued by this idea. It's, it's, I've thought about it a little bit, not a lot, I can't even say I've seriously considered it. But one of the, the teachers at my, my kids school, he, he's made, he's made his money. And so what he did is he, he basically just stopped working. He's, he's got money in the bank and he's like, I'm, I'm gonna, I'm gonna teach at the school and that he's gonna basically go from school to school with the kids and you know, he's gonna, you know, spend time with the family and all that and do his hobbies and all that. And then if he wants to go back to work afterwards, he's gonna do that. And I, I did find it to be an intriguing idea to, to Sell if, like, what if I sold the firm? So it was one of those things where you kind of sit there and you daydream and what if I did sell the firm? Like, I would have plenty of money just to kind of hang out with the kids and take them to school, pick them up, go to all the events. So. But that requires you getting the firm ready to sell and all that. So do you have any advice on, on, you know, anyone that wants to maybe sell the firm?
- [23:29]
Jonathan Hawkins
Yes. I mean, I tell people and I've handled a number of these and, you know, it's. The less the firm relies on you, the more valuable it's going to be to somebody else that's sort of your guiding star. So the more you can remove yourself, you can't remove yourself completely because no one's going to care about it more than you do. I mean, it's the idea of an absentee owner, I think is fairy tale largely. You got to have somebody that cares about it. But that doesn't mean you have to do everything all over the place in the firm. So, you know, I don't know how you've set your firm up, but, you know, you step away. You're not doing the trials, then you step away and you're not doing any client work or very minimal, then you step away, you're not doing any of the hr, the operations, and then at some point you step away and you're, you're really not handling the financial piece. You have people doing all that. They report to you and you, you can turn the knobs and you can sort of, you know, design the initiatives, but then have other people do them. The more you can do that, the more valuable it's going to be because then someone can basically buy you out and step into your shoes and they're not expected, they're not buying a job. In other words.
- [24:40]
Tyson Mutrix
Do you have any opinion on the naming of the firm? So, for example, like, you know, our firm, the legal names, mutrix firm. But I've, I've tinkered with the idea of changing it to more of a. I think generic sounds like a dirty word, but like a dirty name. But like, you know, more of a generic name. Right. That's not named after me. Do you have any opinion on if you're going to sell it, sell the firm, whether you should use a person's name, a generic name? Do you have any thoughts on that?
- [25:11]
Jonathan Hawkins
I do, I do. If you're starting from scratch, I would encourage anybody out there that's fairly young or about to start a firm to think about using a name, a trade name that doesn't have your name in it, assuming your state allows it. For a while there, some states didn't allow it. I think probably everybody does now at this point. But. And that's what I did for my firm. And there are lots of reasons for me, you know, one thing that I'd seen a lot of, it's the fight about whose name is in the firm and where is it. And if somebody leaves, you got to change it again. And then you change in the URL and you're always, you just always change. And clients are getting confused. So if you have a name that doesn't have any attorney name in it, it just makes that whole thing easier. I'm not a Google expert, but then there's sort of the Google SEO game that's out there. And then again, if, if Tyson Mutrix is gone and somebody steps in your shoes, if it's not your name, it matters less to them. Now, if you're a big firm that's been around forever, you know, one of these big advertisers, if you're Morgan and Morgan, you're not going to change your name. I mean, that's, that is the brand at that point. And then, you know, there are instances, I'll say, where a buyer may not care about your name. They may want to ditch the name anyway. So, you know, not all buyers are going to care. Even if you had a trade name, they may still ditch the name. I've seen that too. Because really they think their brand is more powerful. So, you know, I'd say starting out, consider a trade name. If you've been doing it a while, it may not be worth sort of starting over.
- [26:49]
Tyson Mutrix
So let's zoom out just for a second. Are there other ways of building value for the firm? And I know that you said talk, you talked about really kind of removing yourself from, from a lot of the things. I'm assuming that makes it more valuable for the owner because then. Or the, the buyer, because then they're not going to have to, you know, bring you on if they don't want to. So are there other ways of imp. Of increasing the value of the firm?
- [27:13]
Jonathan Hawkins
Yes. And so there's lots of reasons somebody may want to buy it. So let's say you're a strategic buy geographically, so somebody, you know, wants to be in your city. So there, that could be a value to somebody. I think your people, your employees. You know, I was hearing stories sort of during sort of the COVID times where no one could find any help. A strategy firms were using were acquisition just to get people and so that, you know, if you have a good, you know, employees, that sort of thing, a good leadership team. Obviously your marketing systems, if you've got a really good system set up to generate clients and I don't mean pay per click type stuff, I mean you've got a, you know, thousands of clients that you've helped at this point in your database and you have a tried and true system for sort of staying in touch with them and generating cases out of that. That would be extremely valuable and I think you got to prove it. So you know, you've got 2,000 clients, you got to track your leads. How much do you get out of that and for and track it over time so you can go to a potential buyer and say look, now I'm not going to show you my list, but this is what we get from it. That would be extremely valuable. I think. So people how you get cases location. You know, we talked about the name. There could be some value in a name if you have a lot of. This may be changing with AI, I don't know. But if you had a lot of SEO juice in your website or websites, that might be worth something every now and then a phone number might be worth something. But you know, those are sort of the big ones.
- [28:57]
Tyson Mutrix
Yeah. So you mentioned the case list. So tell us about like what's. What's the anatomy of, of the sale of a firm or the bought the purchase of a firm? Like do you. If someone comes to you says hey, I want to potentially buy your firm and they say I want to, I want to. Let me show me your case list. It sounds like you don't have to show that to them. So what are the things you should do? Should do. What's the, what's the anatomy of that that whole process look like?
- [29:24]
Jonathan Hawkins
Well, you do it in stages for sure. Disclosure, actual names. I mean you've got the whole sort of confidentiality issue to deal with. But that should be done like basically right at the very end. That's the last thing you do before you do anything. Stepping back big picture, I think you should just have loose conversations about what you're thinking. If it gets past sort of these first few conversations, then you sign an NDA and then that allows you to sort of have more detailed discussions and disclose more detailed numbers, financial numbers. And again, these are general type numbers. This is not here's my QuickBooks and here's my case list. Because what you don't want to do is, you know, let somebody in the kimono, they see how you do it all, they say, yeah, never mind. And then they just go do it. Especially if it's somebody that's got a lot of money that could just reproduce what you're doing anyway. So you stage it out, do it a little bit at a time. Because oftentimes as you go through the stages, one or both of the parties either decides, yeah, this is not going to work or you just keep going. I've had so many of these never complete that you start it and just never completes.
- [30:45]
Tyson Mutrix
What percentage would you say never completes?
- [30:48]
Jonathan Hawkins
I'd say it's probably two thirds. Wow. I mean, and there's different types of transactions. So there's internal sales external to a third party. But yeah, I mean it's, you know, there are a lot of talks and discussions that sort of don't go anywhere.
- [31:07]
Tyson Mutrix
What's usually the reason why it falls through?
- [31:09]
Jonathan Hawkins
Unrealistic expectations on both sides by the.
- [31:13]
Tyson Mutrix
Buyer or the seller? Probably seller is my guess.
- [31:16]
Jonathan Hawkins
You know, people always ask me like, what's my firm worth? That's like the first question, what's my first worth? And my smart ass response is it's worth whatever somebody pay you for it. And a lot of times a buyer says it's not worth it to me. And that could be that the seller believes it's worth way more than it is or, or they can't walk away. That's another thing I've seen. There are a lot of lawyers that just, they spend all their money so.
- [31:40]
Tyson Mutrix
They, so they're locked in, they need.
- [31:42]
Jonathan Hawkins
A big payday or they got to keep working. So that, that, that's pretty common too.
- [31:47]
Tyson Mutrix
So for the ones where we were talking earlier about the, the attorneys that bring out an associate and they, they end up, not, they end up never leaving. Is that more of a, is it usually like a financial thing where they've got to keep working or is it more of a. Like the law firm's their identity and they don't want to give it up?
- [32:04]
Jonathan Hawkins
It's a little both. It really is a little both. I mean, I've seen plenty where it's, it is absolutely a financial thing. You know, they've some have kids late in life, they're in private school, they're in college. Some have to, you know, think they have to, you know, they may have been through a couple wives or spouses and they just got to keep working because they never saved anything. So there's Definitely some of that. But then the identity thing is, is a biggie. It really is. Especially for this older generation that's sort of at, at this moment their whole identity is really over. You know, their career has been tied up in being a lawyer and working hard and working all those hours and you know, the thought of what do I do tomorrow? You know, you're talking about your friend that teaches. They don't have that, you know, talk to a lot of lawyers. What's your hobby? What do you do in your spare time? And I don't have any spare time. I don't have any hobbies. It's the law. And so again, I think that is a huge thing. I think we all should have those hobbies. But if you're going to successfully this, you got to know what you're going to do on the other side. You know, I don't know if this is true or not, but I've heard from somewhere that the most dangerous time in a man's life is the year after he retires. It's like the death rates go way up apparently. I don't know if it's true or not, but I've heard that.
- [33:26]
Tyson Mutrix
I've heard that too. I don't. I'd love to know if that's true. I don't even look it up because I want to believe that it's true. Just because I don't know. It's, it's a, it's such a wild thing. Like the numbers I've heard are pretty, pretty crazy. But here's the thing. Speaking of death, I did want to ask you about that so. And I don't think a lot of people want to. Want to think about this part, but I think that's part of the reasons why it matters so much. But the succession planning and, or incapacity planning where you're. This is like. I think succession's more of like I'm sort of expecting to die. Incapacity is more like I didn't expect to die this soon. So what's that conversation like with attorneys?
- [34:05]
Jonathan Hawkins
So that's a biggie. I mean that, that is huge. And I really try to get all my solos or solely owned firm owners to do this and, and more are doing it. But I've, I've seen the situation where no plan was in place and I tell the story my personal will. It took me 10 years and three different lawyers from start to actually sign in the thing.
- [34:27]
Tyson Mutrix
Wow.
- [34:28]
Jonathan Hawkins
And it's just, I just kept putting it off. And my wife And I were going out of the country, so we signed it the day before and they were. We just, you know, so it took a while. So I get it. And in the law firm, you know, in the law firm, we're basically doing a will for your firm. So it's a similar context. But, you know, I have seen situations where they did not have a plan in place. And it is a complete sad situation. Shit show sometimes.
- [34:56]
Tyson Mutrix
What if it's someone that's like, I'm a solo. What do I need a succession plan for? Talk to that person right now.
- [35:02]
Jonathan Hawkins
Again, it depends on the type of firm, but some of the. I mean, number one, your family, they're going to be dealing with all sorts of other things that you don't want to throw them in the middle of working on your. Your firm. If you have any staff, you know, I'm pure solo. It maybe needs it even more. But if you have any staff, you're like, oh, well, the staff will take care of it. The situations I've seen, if. If someone dies, the staff immediately gets spooked and jump because they're looking. They're like, I got to go get a job. So they leave.
- [35:30]
Tyson Mutrix
I'm not going to have a job in a week, and so I need to go leave. Yeah.
- [35:33]
Jonathan Hawkins
And so part of what I tell people is make the plan, put some financing vehicles in place, tell your staff you've got them covered, don't jump, you're going to get paid. And then that at least helps wind down the firm. But, you know, there are situations where, you know, death or disability is not a defense to malpractice claim. So. And let's say you're a solo and you're like, oh, my fam, I've got personal life insurance. My state has all this money. It doesn't matter. But then let's say you get hit by a bus and, you know, you're like, I was going to file that, you know, death case two weeks from now. The statute's coming up. I'm going to file that. But you die. And by the time anybody gets in there and discovers that it needs to be filed, you know, it's. It could be weeks or months after the statutes run, and then you got a. You got a malpractice case on your hand, and it would go against the attorney and the firm. And so let's say the attorney personally had assets in their name, they could go after those. And so it could have a negative effect on your family in terms of your estate. So, you know, That's a biggie. Just for that, you should do it. But also, I mean, you want to take care of your clients. You want to make sure they're not harmed in this process. You want to take care of your employees, and you want to protect your family from it. And I'll say this. Generally speaking, if you go through the process to sort of set up a plan, you got to organize your firm a little bit, sort of a minimal amount of organization. And generally speaking, that helps the operation of your firm. So even if you're just going to keep going and nothing ever happens, the operation of your firm and conceivably the profitability of your firm should go up just from going through the process.
- [37:21]
Tyson Mutrix
Nice. Well, part of it is we want to, we want to make sure people stay alive and healthy as long as possible. Is it true that you have exercised every day for nearly 900 days?
- [37:33]
Jonathan Hawkins
Yes.
- [37:34]
Tyson Mutrix
Okay, that's wild. How has that discipline impacted your business?
- [37:39]
Jonathan Hawkins
Well, I'm one of these, you know, check the box kind of folks. I think I've heard John Fisher talk about it. He's one of these guys, too. And I like to keep that streak going. You know, it all comes from that, that Seinfeld, he loves streaking.
- [37:50]
Tyson Mutrix
He's the, he likes streaks. Yep.
- [37:52]
Jonathan Hawkins
It's that Seinfeld joke a day thing. But, you know, I'm, I'm getting older, and, you know, health is important to me. I want to be in as good a shape as possible. And I've gone through periods where I, I have not exercised, and this could be a stressful job, and I just, my stress levels go up, I feel bad, and the exercise cuts that. And so it just, you know, I can feel it if there, you know, I had a long streak before this current streak, and then I, I missed, I missed it. Covid happened and sort of blew my streak. But I started feeling bad. I just started feeling bad. And so, so, yeah, I love it. Gotta do it.
- [38:31]
Tyson Mutrix
What do you like to do the most? What, what's your go to workout?
- [38:35]
Jonathan Hawkins
I lift, I lift weights. I do cardio. You know, that's, that I don't go to the gym every day, but that's, that's a big part of it.
- [38:44]
Tyson Mutrix
Yeah. Do you do any, like, any play, any sports? Anything like Jiu jitsu, anything like that?
- [38:48]
Jonathan Hawkins
No, I, I, My back is screwed up, so I got to be careful about that. So Jiu Jitsu would really mess me up, I think.
- [38:58]
Tyson Mutrix
Yeah, I, I asked, like, because I, I started it about a year ago, so it's, it's like I'm currently standing here in pain, my, you know, back pain. So I was, the reason I ask is like 900 days is a very consistent thing. Like that's a lot. So I was, I was going to ask you, I mean, there's got to be had been days where you were in pain or you felt sick, something like, how did you, how do you get the motivation to fight through days like that?
- [39:23]
Jonathan Hawkins
You know, it's become a habit. I mean, the way I sort of about any new habit, sort of the way I think about things and this sort of demonstrated exercise and I demonstrate it. It's like, you know, when, when you start something new, you're excited, so you've got just this excitement and that'll carry you for a while. Then that starts to wear off and then you got to use willpower and that can only last you for so long. And so if you don't make it a habit and fit it into your life in a way that it is a habit, then you're not going to do it. So for me, the exercise, I got to do it in the morning first thing, pretty much, because I found if I say, well, I'll do it at the end of the day, life happens. And it's just the chances of that happening, you know, it just goes way down. So for me, it's first thing in the morning. It's just part of my morning routine. I get up and, you know, look at Twitter for a while and then go to the gym.
- [40:14]
Tyson Mutrix
So, you know, you have this really good post. It's you say, are you addicted to the planning or the doing? Planning is fun. Doing is often not. In the end, the doers are the ones who win. Talk about that a little bit.
- [40:27]
Jonathan Hawkins
Yeah, so, you know, I'm a shiny object kind of guy, so I was talking to myself a little bit there, but. And I like strategy, so I really like coming up with these grand plans to do things. But I have found that, you know, ideas and plans aren't really worth that much because doing stuff is hard. I mean, building a firm is not easy. It's hard. And so there are lots of things you got to do and it's. You got to do it consistently day in, day out. And there are days where it's not fun. There are days where you may second guess yourself, but you just got to keep doing it and not get distracted with these shiny objects and planning and all that stuff over there. So that's what I meant by that.
- [41:11]
Tyson Mutrix
So how long have you owned your firm?
- [41:13]
Jonathan Hawkins
So I started it about almost seven and a half years ago.
- [41:17]
Tyson Mutrix
And things seem to be going well for you. And so I wonder if you could give some advice to people that either they're just starting out or maybe they're a few years in, they've kind of hit that point where they feel like they've kind of stagnated and they've, they're like, okay, is this going to get better? What do I do here? Because sometimes people get to this point where like they sort of stagnated and they're like, am I ever going to get through this? Should I just, you know, wind things down and go work for someone? I guess. What advice would you give to someone that's sort of in that, that situation?
- [41:47]
Jonathan Hawkins
Well, the first thing I would ask is, you know, are you employable? Do you need to be the boss? And so that's the first thing you got to believe in yourself. But the other thing, that old Hemingway quote about bankruptcy, you know, how did it happen? It was slowly. Then all of a sudden, I think that's success of a law firm. I mean, you're going to plateau and you're going to, it's going to feel like you're going nowhere for a long time. You just got to keep doing what you're doing. And a lot of the seeds that you plant take months or years to grow, but once they bear fruit, they, it's just everywhere. You just got to sort of get there. And so I would say hang tough. Now there are specific situations where, you know, you need money or whatever, you may have to go get a job. I get it. But if, if you can push through, I would say keep pushing.
- [42:34]
Tyson Mutrix
So I was just doing a little bit of math in my head. I'm gonna go back to your workouts a little bit. Cause it, it, I think it's related. Cause you're talking about consistency and like the, you know, Seinfeld with the jokes and like same things apply to the firm. But so you are. Today's 8:90. So you're 10 days away, I, I think from your getting to 900. So your most days in a row is 10:57. When you get to 900, are you going to do anything special? Do you celebrate or like, or you just like, it's another day.
- [43:01]
Jonathan Hawkins
It's just another day.
- [43:04]
Tyson Mutrix
Incredible. Incredible.
- [43:07]
Jonathan Hawkins
And let me back up when I say workout or whatever, exercise. So you know, it could be going for a 30 minute walk. I mean a few years ago we went to Disney and I walked you know, basically 30,000 steps a day. That counts, right? In my mind, that that counts as being active. It doesn't have to be like an actual exercise at the gym type thing.
- [43:30]
Tyson Mutrix
Listen, I, I think that that counts. I, yeah, so I don't, don't even try to discount that. I think, you know, I think that that's completely valid and I think it's impressive. I think, gosh, I. Do you, do you track your, do you have like a whoop or anything where you track your steps or anything else?
- [43:45]
Jonathan Hawkins
I do, I have a Fitbit for my steps and sleep, which is really bad. But. And I just, it's hard for me to sleep. But I have this little habit or this habit tracker. It's called habit share. You probably know Tom Tona, he put me onto this. So it's pretty cool. It's sort of an accountability and a tracker. So you can, you set up what you want to track and then you can share it with people. So they can, if you're not doing it, they can call you and say, hey, you didn't, you didn't exercise today. And so that's how I know. So, yeah, today is 891 for my days.
- [44:18]
Tyson Mutrix
That's fantastic. Well, we're going to end it on this. So you are, you're the outside general counsel for law firms, right. And most lawyers don't think that they need a lawyer until it's too late. So what is your parting advice to anyone that has that, that mindset that, you know, they don't need a. Need a lawyer, they are a lawyer. So I don't need a lawyer. So what is your advice to those people?
- [44:41]
Jonathan Hawkins
Well, I'd say this. I get this a lot. So lawyers, I mean, we're smart. You can probably go figure it out if you know what the issue is. You might spend a lot of time getting there, but you can probably get there. And this is the old, you know, Donald Rumsfeld. Known unknowns and unknown unknowns. You don't know what you don't know. And somebody like me, there are others like me. We see a lot of different firms and have seen a lot of different situations. And we can bring that, you know, what we learn over here, we can bring to a client over, over there. And so, you know, and, and I've, I've looked at a lot of do it yourself agreements over the years by lawyers who are smart, and some of them just really are not very good. So be careful out there.
- [45:23]
Tyson Mutrix
Love it. Jonathan, how do people get in touch with you. If they want to reach out to.
- [45:26]
Jonathan Hawkins
You, find me on LinkedIn. That's a good place. Jonathan Hawkins My email is jayhawkins at law firm gc.com feel free to reach out to me there@website lawfirmgc.com Love it.
- [45:38]
Tyson Mutrix
Thanks Jonathan. Appreciate it.
- [45:40]
Jonathan Hawkins
Thanks Tyson.
- [45:53]
Tyson Mutrix
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