Taking on a law firm partner with a different specialization helps broaden your horizons. Most attorneys are specialists in a single field of law. By specializing in a single field, attorneys master their chosen subject area and become word-class in that specific niche.
But today’s client work is increasingly complex and cross-functional — specialist attorneys often can’t fulfill all of their clients’ needs. By bringing a new law firm partner on board, one with a complementary specialty, firms can better serve existing clients, grow their client base and increase profits.
Let’s explore what you should look for in a new partner, outline the business considerations when taking on a partner with a different specialization and discuss how to publicize your firm’s additional services.
What should you look for in a new partner?
Your ideal partner will have complementary skills and knowledge — their specialty will be closely linked to your own. If you specialize in prenups, consider partnering with someone specializing in divorce law. Or, if you’re an M&A lawyer, consider partnering up with a tax lawyer as M&As involve plenty of financial and tax work. Think about what your clients might also need but that you can’t offer, and find a partner who can.
New law firm partners should also ideally have a similar bank of experience. If you bring somebody on board who’s significantly more junior than you are, it might be a while until they add a huge amount of value to the firm. Likewise, a significantly more advanced attorney might not want to drop down a few levels to join your firm, unless they’re actively looking to wind down toward the end of their career and maybe take on a mentee.
Lastly, your new partner would preferably have an existing client roster that matches your own. There should be plenty of crossover — you want your clients to use the new partner’s services in the future, and for your partner’s clients to also use your services. However, if your new partner’s clients are direct competitors to your own clients, consider finding someone else to bring on board. You don’t want to lose valuable clients while trying to grow your firm — that’s counterintuitive.
What are the business ramifications of bringing a new partner on board?
Unfortunately, bringing a law firm new partner on board isn’t as simple as hiring a regular employee. You’ll have to decide how much to pay them, whether they’ll receive equity (and if so, how much), set a buy-in price and work out whether this’ll be paid in installments or through salary reductions. You’ll also have to decide if the new partner will guarantee company liabilities.
There might also be licensing considerations, especially if your new partner is moving from one state to another. Reciprocity — when a state’s bar admits an attorney based on their membership in another state’s bar — is not standardized throughout the U.S. Each state has its own set of rules, so make sure you and your new partner are up to speed with your state’s particular regulations.
Your new partner must be aware of their own individual responsibilities. If they’re a lateral hire (i.e., if they’re already a partner at another firm), they need to review the terms of their existing partnership/LLP agreement and understand their fiduciary obligations. There are also notable tax considerations if your firm is based in multiple states across the U.S. Full-equity partners must pay tax in every state that the firm does business in, though electing into composite state tax returns simplifies the process.
How should you publicize your firm’s additional services?
If you’ve got a new law firm partner and your firm’s expanded into a new specialty, now’s the time to spread the word. Post updates on both your personal and your firm’s social media profiles (LinkedIn, Twitter, Facebook and maybe even Instagram). If possible, try to publish press releases in local and maybe even national newspapers, and in any well-read industry publications.
Update your firm’s website and social media profiles immediately. Ensure that your online presence reflects your full breadth of services and newfound capabilities. Get in touch with your firm’s existing clients and your new partner’s client base to let them know that your firm now offers a more valuable, integrated set of services.