If cash comes with fame, come fame;
if cash comes without fame, come cash.
– Jack London
In my line of work—that is, helping attorneys become wildly successful—I often must remind them of a simple truth: Cash is king. Yes, the practice of law is a calling, and yes, you can do good things for a lot of people, but your law firm is a business first.
You’d be surprised how many attorneys forget this. They get so caught up in the details of their clients’ cases and the burdens of managing their offices that they often forget they’re supposed to be making money—a lot of it. And I don’t mean cash that they can use to pay their bills. I mean cash they can use to improve their lifestyle and to grow their business even further.
I’m amazed at how many attorneys and law firms actually struggle financially. The New York Times recently reported that some big law firms are cutting partners from their rosters. Meanwhile, of lawyers starting their own practices, they frequently strain to pay themselves enough to cover bare essentials. And they don’t seem to have anything left to grow their firms–that, according to Law.com. Among my clients, I regularly see attorneys who have a positive cash flow, but they’re still frustrated that they don’t have enough cash to invest in growth.
I believe that being a good lawyer and being a rich lawyer shouldn’t be mutually exclusive. You should be able to do good work and make money hand over fist.
The good news is, you can do both—but it starts with acknowledging that your firm is a business, and businesses exist to make money. The plain and simple truth is that the more cash you can extract from your company, the more successful your company is. Thus, your goal should always be to find creative ways to improve your profit, so you have more free cash.
More good news: You already have the assets you need. They’re sitting somewhere in your company, just waiting for you to discover. In future posts, we’ll talk about ways you can find it.