Beyond Biglaw: Interview With A ‘NewLaw’ Pioneer (Part I)
I recently had the opportunity to meet in person, and then conduct a written interview with, Marlene Laro, Partner & Chief Operating Officer of Potomac Law, a law firm founded with the idea of offering clients and lawyers an alternative to Biglaw structure and rates. Over the course of our conversation, and as reflected in Marlene’s answers below, it became clear that we may be on the cusp of an explosion of a new breed of law firms entering the broader legal market. Lawyers considering launching their own firms, or joining existing ones, will likely benefit from the paths forged by firms like Potomac Law, and other smaller firms which embrace varied business models and approaches to success in a competitive legal services landscape. I hope that readers find the interview with Marlene as interesting as I found learning about the impressive firm she and her partner, Ben Lieber, have built.
Q) We at KSK have found it important, particularly as Biglaw refugees, to provide an easy categorization of our firm to others. In our case, we often say we are a focused boutique, or something along those lines. How do you characterize Potomac Law’s model?
“New-model law firm” is typically the term applied to Potomac Law, but this label is very broad. Within the “new model” category, there is a spectrum of legal services providers, from high-end legal staffing providers to virtual firms offering shared marketing platforms to true law firms utilizing a distributed workforce. We put ourselves firmly in this last category. We often refer to our firm as a “traditional law firm with a modern twist,” which conveys that we offer a similar level of legal service and talent as a Biglaw firm, but with greater reliance on technology and telecommuting to reduce overhead and enable considerably lower rates.
Q) What are the similarities between Biglaw and Potomac Law?
The typical Potomac Law lawyer is of the same caliber found in Biglaw — highly experienced in a particular field with excellent academic credentials and good client hands. That’s not entirely surprising considering most of our lawyers join us from Biglaw’s partner, counsel, or senior associate ranks. As in a traditional law firm, our lawyers often work collaboratively on client matters, particularly in the case of litigation and M&A work. We also have a healthy mix of rainmakers and service attorneys at our firm, as you would find in Biglaw. Another important similarity is the complexity of work — we have grown in five short years to develop very active practices in a range of higher-end fields, including patent, tech transactions, and IP litigation.
Q) What are some key differences between Biglaw and Potomac Law?
The primary difference (other than billing rates!) is that we do not make use of a classic pyramid/apprenticeship model. Our lawyers have a minimum of seven years, and on average over 20 years, of legal experience; we do not have junior or mid-level associates. Clients often feel the best value is found at the senior associate and partner levels (where they avoid having to pay to train attorneys), and so we have built a firm around these profiles.
That leads me to another key difference — office space. While we have the nice, well-appointed office space one might expect of a 60-lawyer firm, it is small — very small — and is meant more for team sessions, client meetings, and firm lunches than as a day-to-day workspace. Most of the work is performed remotely, again keeping our overhead down.
In addition to lower hourly rates, as a younger firm we have the flexibility to provide a greater range of fee arrangements, from fixed fee to success-based to other creative, shared-risk approaches. I should note that very often clients are content with our primary fee arrangement (low hourly rates), but we do work with them to shape alternatives where there is an interest.
All of the above is from the client perspective, but there are some important differences from the attorney perspective as well. We do not have minimum billable hours for attorneys, nor do we have origination targets for partners. That’s a function of our compensation model — we pay lawyers based on their billings and originations, typically at a much higher effective percentage than in Biglaw. Lawyers also have much greater latitude to set their own rates here. We believe that this model is a win-win: for clients, who enjoy lower rates, and for attorneys, who keep much more of what they earn.
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