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Jan 15, 2013
Law Firm Owner Considering Bringing in a Partner
I am the sole owner of a law firm in Tucson, Arizona. I have 7 associates working for the firm. I have one very senior level associate that I want to consider for partnership. I want to do this to keep him interested (he has been approached by other firms) and I envision him being a cornerstone of my succession plan – 10 years out. How should I start the process with him?
It sounds like you have found the person – or whom you believe is the right person for partnership. However, just because he has been a good associate does not mean that he will be a good partner – the relationship will be different. But at least he is somewhat of a known quantity since you know him and have worked with him for several years.
Here are a few ideas of where you might start:
- Outline you goals and expectations for the relationship.
- Meet with your associate and identify his goals and expectations for the relationship.
- Determine how much control over the practice and decision-making are you willing to give up? Share?
- Determine how much and for how long you are willing to make less?
- Determine if the associate will be expected to bring in business? When/Timeline?
- Think about the firm you want to build – firm-first or lone ranger (team based or individual practices)?
- Decide on firm name – will it change? Should it? Impact on image, clients, etc.
- Decision as to capital contribution or buy-in? Yes or No? How much? Timeline for payment?
- Ownership percentages
- Withdrawal arrangements
Once you can come to terms with some of the above issues craft a suitable partnership or operating agreement that you can both live with.
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John W. Olmstead, MBA, Ph.D, CMC
Posted at 08:13 PM in