The law firm launch plan
Every step from deciding to opening, in the order it happens, shaped to your situation, with your own numbers beside it. About 52 steps in 8 phases, 23 of them specific to a law firm. Free to read; ticking steps off and putting in your own numbers come with membership.
The plan52 steps
- 01Not started0/6Fold
Decide with the numbersa week or two
Before a dollar is spent. Most expensive mistakes happen here, and this phase costs nothing.
A law firm makes money on billed-and-collected attorney hours, and the order you grow them decides your margins.
Typical for one unit is $500,000 to $5,000,000 a year; the owner keeps 20 to 35% of it before paying themselves. If that band does not cover what you need, that is the signal to pause and look again.
~50-60% survive 5 years. Roughly half of all new U.S. businesses reach five years.
Twelve questions about your money, time, experience and temperament, scored. Then the 5 questions this business asks of its owner, about the hours and the work. Answer both before you spend a dollar.
Rule of thumb: if you can buy a well-run firm with a real retainer book and attorneys likely to stay (ideally with the owner’s help through a transition), buying buys you years of pipeline. Answer it in your situation above and the plan reshapes.
Customers, prices, rent, staff pay, what it costs to open. We filled in typical numbers; change what you know and everything on this page follows.
- 02Not started0/5Open
Plan the moneya week
What it costs to open, where the money comes from, and the cushion that keeps you alive until the business pays for itself.
A law firm is capital-light to start compared with a fixed-asset business: there is no beyond an office, because the asset is credentialed people.
The itemized cost to open8 lines
- Computers, monitors, scanners, printer and network: $9,500 to $31,000A workstation and two screens per seat, a multifunction printer, phones and a firewall
- Furniture, conference room and secure files: $6,000 to $34,500Desk and chair for each seat, a conference table, locked and fire-rated files, a shredder
- Office refresh and cabling: $0 to $33,000Nothing if you take a second-generation office as is; paint, carpet, wiring and a new office at the top
- Logo, website and signs: $1,000 to $24,000How referrals and first clients check you out
- Bar dues and entity setup: $2,000 to $6,000Active bar license for each attorney, PLLC or PC filing, trust account setup
- Malpractice and other insurance (first premiums): $4,000 to $22,000Malpractice for each attorney, office policy, cyber and workers’ comp
- Lease deposit and launch marketing: $8,500 to $28,000One to three months of rent and the first referral and search ad push
- Initial working capital: $20,000 to $80,000Payroll and float while matters bill and collect, 3-6 months
Costs start on day one; customers take months. Map the first twelve months of cash so the business does not run out of money while it is getting going.
The business has to earn your pay like any other bill. Set it in your numbers and watch the month it move.
How deals in this business are financed4 lines
- SBA 7(a) loan (Up to 10 yr (25 with real estate) · 75-85% government-guaranteed)The workhorse for buying an existing firm or funding a startup’s office and working capital.
- Seller financing (Often 5-25% of price · 3-7 yr)Very common when buying a book of clients.
- Working-capital line of credit (Revolving · secured or unsecured)A revolving line to bridge the gap between billing and collection.
- Equipment & technology financing (Secured by equipment)Finance workstations, secure document systems, and office technology, secured by the assets.
Most new shops pair an with 10 to 20% of your own cash. Know the monthly payment before you look at a single space.
Before you shop. A lender tells you what they would fund, what they need from you (credit, your cash in, a plan with numbers), and a pre-qualification letter makes a landlord or a seller take you seriously.
- 03Not started0/4Open
Set up the companya day or two
A day of paperwork, and it has to come before the space: a lease, a loan application and every permit are in the company’s name.
Your state’s business name search, the trademark register, and the domain, before the name is on a sign, a van, or a lease.
A , an , and the S-corporation election each change what you keep and what you are exposed to. Compare them with the numbers, confirm with a CPA and an attorney, then file with your state.
After:The is free from the IRS in minutes once the company exists. The bank account needs both. Keep business money separate from day one.
After:Pick the accounting software and connect the bank account now, so every cost of opening is captured and the numbers you later are real.
- 04Not started0/6Open
Find and secure the spaceone to three months
A law firm has no storefront in the retail sense: your "location" is the market and the referral network you serve.
What decides it for this business: strong demand in your practice areas, clients able to pay premium rates, active referral sources, available legal talent pool, not oversaturated in your niche.
One call to the planning desk with the address: is this use allowed there, and what will it take (, permits, fire sign-off)? A space that needs a change of use can add months.
Rent, free months for the , who pays for what, the and the renewals, subject to financing and permits. The lender needs this letter or a draft lease to take your application.
After: ,, renewal options, increase caps, what the landlord adds on top of rent, and what happens if you have to leave. For a location business the lease is part of the purchase price.
After:at minimum; property, workers’ compensation and the rest as the business needs. The landlord asks for a certificate at signing and the lender at closing.
Walk the floor plan and the equipment list, then get contractor quotes. The lender wants the quotes; the health department wants the plan.
- 05Not started0/2Open
Get the loanfour to eight weeks
Four to eight weeks with an SBA lender, longer if the file is incomplete. Everything else waits on this, so send a complete file.
Your plan with numbers (download it as a PDF from this page), the company’s papers, the or draft lease, the and equipment quotes, your personal financial statement, and proof of the cash you put in.
After:The lender approves against the ; you sign the lease once approved; the loan closes against the signed lease and the insurance certificate. Ask for the to match the or longer.
After:
- 06Not started0/14Open
Permits and the build-outone to three months
A law firm is one of the most regulated businesses there is: you must be licensed to practice, you hold client funds in trust, and you owe ethical duties the bar enforces.
Bind the policies you had quoted before a contractor, a vehicle or a customer is in play. Keep the certificates; the landlord, the lender and the city will ask.
After:Your contractors pull the building, plumbing, electrical and mechanical permits and close them out by inspection. Hold the free rent months for this.
After:Most cities approve exterior signs separately; signs take weeks to make. Order early.
Most states require a professional entity (PLLC or professional corporation) owned by licensed attorneys, plus a city or county operating license.
With your state, before the first taxable sale. Usually free and online; check your state.
Every attorney must be admitted to the bar in the jurisdiction where they practice.
A compliant client trust account, separate from operating funds, with the reconciliation procedures the bar requires.
in some jurisdictions and prudent everywhere; often a condition of practice and of referral relationships.
A documented process to screen new matters against existing and former clients.
Annual bar dues and CLE requirements keep each attorney in good standing to practice.
State registration for business taxes where applicable; legal services are taxed differently by jurisdiction.
Ongoing three-way reconciliation of the IOLTA trust ledger, maintained per bar rules and subject to audit.
Fire-marshal review of exits, extinguishers and load, after the build and before the .
After:The city’s sign-off that the space is approved for this use. You cannot open the doors without it.
After:
- 07Not started0/10Open
Set up to runduring the build
During the build, so the business runs from day one: the systems, the prices, the people and the routine.
The backbone: manages matters, captures time contemporaneously, runs conflicts, and feeds billing.
Get invoices out fast and collected faster.
Client funds must sit in a reconciled trust account, separate from operating money.
Legal malpractice coverage is in many jurisdictions and prudent everywhere.
See the price the the business needs implies, then check it against what the market pays.
Federal plus state employer, withholding, and workers’ comp once you hire attorneys and staff.
After:Wages are the start: , insurance, training time and the hours you stop billing. Owners usually post the jobs a month out and hire two to four weeks before opening so training happens before the doors open.
Early morning: Review the docket and deadlines, triage new intakes, run conflicts... Daytime: Attorneys work matters: drafting, research, calls, hearings. Deadline crunch: Filings, closings, and hearings drive bursts of intense, high-value...
Opening, closing, the sale, the complaint, the cash. One page each. This is the manual a franchise would have sold you.
Free, and it is how most people will find you. Address, hours, photos and the menu or price list, live before opening day; then the sign, the soft opening and the first regulars.
- 08Not started0/5Open
Open and measurethe first ninety days
You own it. Now run it on the numbers.
Friends, neighbors and a short menu or list. Find the problems while the room is forgiving.
Enter the real numbers and see every cost line against the for this business.
Attorney compensation & leverage; Realization & write-downs; Non-billable administration.
Growth consumes cash before it produces it. Find the rate your own cash funds before you push.
Law firms are sellable assets, but the value is unusually personal.