Company Counsel began out of the ashes of the 2002 “Tech Recession.” When the tech market nosedived, the legal market also took a huge hit. Big players (Brobeck, Testa Hurwitz, Hill and Barlow and others) suddenly dissolved or were absorbed by other firms. Steve and Sean’s former firm was one of them.
With this severe disruption, though, came opportunity. Over the 5 year period prior to 2002, law firms had increased their rates dramatically. While these fee structures were acceptable for major transactions (IPOs, mergers, etc.), it became tougher for emerging companies to afford the day to day legal services they needed to build their business. Clients would tell us: “We like you, but we can’t afford to call you.”
As law firms vanished from the landscape, we decided to try something new. We slashed most all of the costs associated with traditional law firms, including the expensive leases, the huge admin staff and the pyramid lawyer structure. Instead, we created a virtual firm of seasoned attorneys where the only equipment needed was a cell phone, a laptop and a printer. Most importantly, we cut our hourly rates in half so clients could afford to seek advice on critical operational decisions.
The structure had other benefits. In particular, we no longer had to bill the 2,000 plus hours per year most law firms want to see from corporate lawyers. This meant we were able to spend more non-billable time getting to know our clients and understanding their businesses. Since we no longer needed to go to an office, we also had a more flexible schedule. This made it easier to meet our clients needs while spending time with our spouses and friends, raising our families and pursuing other interests.
We started with seven clients, including Confluent Surgical, BzzAgent, marketRx, Barrett Technology, and Varden Technologies. We decided that we would not do any formal marketing other than through word of mouth. We told everyone in our networks what we were up to and we focused on helping our small number of clients build their companies. These clients have proved to be some of our most vocal champions and, more than any other marketing tool, we have relied on their referrals and their networks to grow our business.
We still use our original model (with some tweaks thanks to smartphones and cloud computing). Most all of the entrepreneurs who had founded our original clients also continue to work with us either in the same company or through new startups (see Instylla, Flipside Crypto and Axtria). This longevity has allowed us to better anticipate their needs and become part of their inner circle of trusted advisors. We are excited to continue helping them to achieve their goals.