Hunting, Hiring, and Keeping High-Dollar Rainmakers

How do you hire rainmakers for your law firm?

 

Finding and Hiring Rainmakers

The Holy Grail is finding and hiring young lawyers who can generate business.

The hunt is painful. We pick the lawyers carefully. We train, we feed and water, and we sprinkle love and attention on those young lawyers and they grow. We get a front-row seat to witness their increasing confidence, developing maturity, and improved skills. It’s exciting.

Then those young lawyers stab you in the heart.

I’ve always wanted to grow my business by hiring young, talented, personable associates who can learn to bring in business. I’ve been attempting it for years. I’ve hired, trained, coached, encouraged, and supported them in their efforts. It has been very hard, and only a few have been successful at bringing in referrals. Most haven’t done particularly well.

We’ve found very few who can actually bring in work. Even fewer have been willing to stick around.

There’s a phrase we use for law firm associates who are good at bringing in business.

They’re called “former associates.”

Seriously. It’s depressing.

The idea that you’re going to rapidly build your business by hiring and retaining associates who can generate a book of business is borderline fantasyland.

Sure, you’ll find a rainmaking associate you can retain—once every 100 years. But that’s not a model that sustains a business that needs to generate a return right now. Maybe 100 years is an overstatement, but you get the idea.

The Facts About Generating Business

These are the facts—as I’ve experienced them—over 30 years of critically observing our industry.

  1. The most profitable engagements come from referrals.
  2. The referral sources sending the best of the referrals are other lawyers, with business owners running a close second.
  3. Most, not all, of the most profitable law firms are generating nearly all of their business from referrals from these two sources, along with referrals from former clients.
  4. There are very few lawyers who crush it at generating business. I define “crushing it” as putting about 10 associates to work on the business they generate. That kind of ratio is what it takes to maintain a highly profitable firm. You can be profitable with a lower ratio, but higher is better, right?
  5. Highly profitable firms typically have one lawyer generating enough business to keep 1o lawyers busy. They amount to about 9% of the lawyers in the firm. In a 300-lawyer firm, there are 27 of them. In an 11-lawyer firm, there is one.
  6. It’s possible to build a business without good referrals, but it’s harder, and it involves business and marketing savvy that doesn’t come naturally to most lawyers. It requires significant investment, lots of hunting for the new “new” thing, and a considerable investment of time and attention.
  7. Building such a business quickly, without referrals, requires substantial capital investment in marketing. Most small firms are bootstrapped and lack capital so growing quickly, without referrals, isn’t an option. Even with appropriate investment, these firms struggle to achieve the profitability levels of the firms built upon a solid base of referrals.

I can’t count the number of small law firm owners who explain to me that they’re going to hire associates who are going to go out and generate referrals. I express my doubt, and the lawyer responds by explaining the clever compensation system that’s going to make it work. Mostly, it doesn’t work and by “mostly,” I mean that it doesn’t work.

How Law Firms Create Sustainable Growth

Finding associates who can generate business and who will stick with you after they realize they can generate business is tough. Mostly they can’t generate the business. If they can, they tend to leave pretty quickly because they imagine—often incorrectly—that they’ll make more money on their own.

When you study the 300-lawyer firms that have attracted 27 lawyers who make lots of rain, it’s fairly common that the bulk of the rainmakers came in laterally. They lead a firm or practice group that was acquired, or they came alone but brought their clients. Finding 20 rainmakers as young associates and raising them into rainmakers is exceptionally difficult and extraordinarily rare.

When you study the 15-lawyer firms operating in a highly profitable manner, it’s typical that a single rainmaker (founder) created the firm and grew the business over time by building referral relationships. The 15-lawyer firms generating business in other ways (mostly advertising) are nearly always significantly less profitable than those with the single rainmaker generating referral business.

Your 7-Step Plan for Growth

What’s the plan if you’re planning to grow through adding rainmaking team members? It can be done, with the right approach and incredible determination. Here’s my advice.

1. Hire associates with a proven rainmaking track record.

There are lawyers who are good at generating business. These folks are already generating business. They’ve got a portable book of business they take with them when they move. They come with clients or significant referral relationships. They’re profitable from day one. They come in fully loaded.

When you’re hunting for these folks, be careful to study the track record. Some prospective associates look like rainmakers because they’re bringing business with them. Study those clients carefully. Be sure they’re long-term clients who will continue to require services. Don’t mistakenly assume candidates are rainmakers because they’re bringing business generated by others. The presence of clients right now doesn’t necessarily indicate an ability to generate new work going forward.

Trying to identify these folks before they have a track record is the holy grail. I wish I could do it. I’ve tried. I’ve tried special interview techniques, psychological testing, and careful examination of pre-law employment and references. Nothing has worked for me yet. Maybe you’ll find the magically successful approach to hunting for these needles in haystacks, but it has eluded me thus far.

2. Respect the relationship.

The rainmaking lawyers are very, very rare. When you find and convince one to join your firm, you need to keep that person. Because they’re so rare, you’ve got to minimize turnover. If this is your plan for growth, then you need to take it very seriously and build a system that sustains the retention of these key team members.

Rainmakers tend to have high social needs. They want to feel like a member of the family, and you’re going to need to be sure that happens. These are special people, and they need a special role in your life. They need to feel a very strong, personal connection to you, the law firm, and your family. That only happens by building that kind of relationship and by giving of yourself. Time and attention are the keys to creating such a relationship. Thankfully, these relationships are good for them, for you, for your family, and for the business interests of everyone involved. This is the foundation of retaining these folks forever.

3. Be flexible.

You’ll need to adapt to meet the needs of these special lawyers. They’ll have staffing issues, systems issues, and personal requirements that need to be honored and addressed. Listen carefully to the issues encountered by your rainmakers and help them navigate a path to getting their needs met and goals achieved. Sometimes that’ll mean changing the system to keep the rainmaker functioning effectively.

4. Cede some control.

Yes, it’s your law firm, but it won’t grow without these folks. Drawing lines in the sand will alienate these lawyers. Like you, they appreciate some control over their environment, schedule, and work life. Give them what they need, even if that pushes your control-freak buttons. You’ll have to communicate extensively and constantly to find a balance that works for all parties. It’s delicate, but it’s essential.

5. Give up some money.

These folks are often driven by money. That’s a good thing because it’s easy to understand and manage. Don’t expect big rainmakers to come on board and stay for small amounts of money. They want their share, and you’ll need to pay. Firms with big advertising/marketing budgets sometimes spend 15 percent of revenue on these efforts. Referral-based practices spend a small fraction of that amount, and those funds need to be allocated to these rainmakers. These folks expect and deserve significant compensation.

6. Use all the tools you’ve got.

What matters to some rainmakers may not matter to others. There are many tools in your toolbox. Use them all in the right way with the right lawyers. Some value time, so give them time. Some value money, so give them money. Some value titles, so give them titles. Some value ownership, so give them ownership. Some value respect, so give them respect.

7. Wash, rinse, and repeat.

It’s likely that you’re one of these folks who can generate business. You know that you’re a handful. Can you imagine being the person charged with managing you? The rainmakers you find are going to be a lot like you. It’s going to be tough. The secret sauce is detailed above. It’s all about understanding your rainmakers as people, knowing their needs, and then working hard to address those needs over the long haul.

The rainmakers are, like all of us, changing and evolving, and their priorities will shift over time. If you want them to stick around, it’s your job to stay attuned to those changes. You’ll need to be listening hard and shifting your approach as circumstances change. It’s tricky, but it’s what’s required with this approach. When your attention fades, you’ll lose people. You’ve seen it many times, as firms lose entire sections with big numbers of lawyers walking out behind the leadership of a rainmaker. You can’t let your attention drift.

Realistic Expectations Are Essential in the Hunt

Many of us are good at generating business. We get that it’s not something that comes easily to others, but we fail to appreciate how unusual it is to possess this particular skill. We assume that if we can do it, others can do it as well. Sometimes it takes repeated failure for us to appreciate that these skills are rare.

Expecting your associates to generate business is probably expecting too much. The lawyers who can make it rain are few and far between. You’ll lose lots of talent if you allow yourself to get frustrated in the hunt. Take your time and expect it to be challenging, and you’ll eventually find what you’re seeking.

These special lawyers are out there. They’re the foundation of every successful firm. They’re small in number, but they are the key to growing the firm profitably. The hunt will be painful, but the rewards will be significant.

If you’re one of these rainmaking lawyers, then you already know the economic power of your skill set. You know how well it works to have one of you in the center of the business surrounded by others who can capably meet the needs of your clients. Finding someone else like you who can help you scale upward will be a challenge, but it’s a challenge others have overcome. With your special skills, you can do it as well.