EP 217 – David Crum – Strategically Managing Your Law Firm in 2023
The following interview has been transcribed for our readers from rev.com. Please excuse any discrepancies in the transcription.
Eric Bersano:
Hello, and welcome to another edition of Legal Mastermind podcast. Today I have with us David Crum of the US Legal Groups. Welcome, David.
David Crum:
Hey, it’s great to be here. Thanks for having me.
Eric Bersano:
Of course. So, I want to do a quick introduction, quick meaning just a brief overview, and then I really want to dig into some of the details of what you’ve been able to build up over the last several years. So, could you give the audience an idea of who you are?
David Crum:
Absolutely, absolutely. Yes. So, I own a company called US Legal Groups, which is really a law firm conglomerate that owns three other law firms. They’re all divorce and family law, and those are in New Mexico, Nebraska, and Colorado. I started just as many people do as a solo practitioner in Albuquerque, New Mexico. I was 26 years old, I couldn’t get a job, so I started my own practice.
I was able to successfully grow that to the point where I was no longer taking cases. I was managing, and frankly, I got pretty bored. So, I was looking at my next thing. I was in a high-level marketing group at that time. They were advising me that I should get into coaching other attorneys to do what I did. Really didn’t have much interest in that. If you’ve worked with attorneys, it’s a pain in the ass, right? They’re smart, but they don’t like to listen. And so, that really didn’t get me too excited. I said, why don’t I just do what I would teach other people to do and expand these practices into other markets? So, I grew up in Nebraska. That was my hometown, so I was looking for some affinity marketing there. So, we started a practice in Nebraska, grew successfully, and then turned our sites to Denver, Colorado, which was a bigger market than we had been into.
It was just super cool, close place to be. We started that and we’ve never looked back. So, I’m actually most of the time now up here in Castle Pines, Colorado.
Eric Bersano:
Now, I’d like to dig into all that medium stuff. So, you had the start and now you’re up to several different states, several different law firms. So, for an attorney that’s listening to this who might be that 26-year-old version of yourself, what advice would you give them? So, you’re talking about someone who might be fresh out of law school, might be going out on their own for the first time. Marketing is something that’d say you have an expertise in, but with marketing comes cost. So how do they make the most of their budget so that they can grow without putting too much on the line?
David Crum:
It’s a great question. I’ll tell you, the other thing I should talk about, to put this in context is at some point we decided to start our own marketing agency, because we were outsourcing or using so many vendors and spending so much money. At that point, it just made sense to build an in-house team.
That team eventually morphed into its own company called Cardinal Concepts. So, we provide marketing services all across the United States, so other divorce and family law firms that are not obviously in our markets. So, I see firms of all shapes and sizes all over the United States. And as a young attorney, what I would tell people to do is think about… Start with the end in mind. And that means you’ve got to get the very best operational systems you can in place. Because if you start building your practice and you don’t have say, a good matter management software like Clio, if you don’t have a way to manage your ads or leads and things like that, after you get on this growth trajectory, you’re going to have so much pain because you’ll have to start over again, and getting the data into the right places. So, it’s that, and then it’s looking for relative strength in your market in terms of marketing. You should be looking at PPC, SEO and social media.
PPC is going to be the quickest way, and again, you’re looking to relative strength. You don’t have to launch a massive advertising campaign when you’re just starting. You look for those campaigns that are going to be most cost-effective. Social media is not a bad one either. Those are very inexpensive clicks, harder to convert those leads into clients, but that’s what I would have people focusing on. And what would be the idea for expanding the practice maybe beyond your geographical or beyond your present vertical. Because you’re just going to hit natural limits as you grow your practice in a local market.
Eric Bersano:
Yeah, you make a really good point about creating that solid base or foundation, because managing a small practice in a small market can be done, but as you start to grow and you start to put more people into that machine, if your processes aren’t in place or things like Clio, your intake isn’t really dialed in, things could break really fast.
So, how do you convince? So, from my perspective, you’ve got to have a buy-in at the top. The person at the top really has to buy-in to that uncomfortable, no one likes to change at first, right?
David Crum:
Right.
Eric Bersano:
So to have somebody or their whole team learn Clio, to have somebody and their whole team use a new intake process, do you have any hacks for that or any tips to just say, “Hey, you’ve got to bite the bullet, it’s going to take you a month or six months to really make those changes?”
David Crum:
Yeah. Look, I think the people who own law practices need to reinvent the way they’re thinking about themselves. You are a CEO, and you need to start acting like that. And as a CEO, your main job is to create the vision for your practice. Everybody below you should be executing your vision.
So that’s critical to have your vision clearly stated to your team, and then to figure out how to get the buy-in. I wanted to mention a book for people that are listening called Leading Change. It’s a great book on how to roll out change in your organization, even if it’s small. We use that when we started to restructure the firms to look more like a proper company with the CEO, CFO, CMO, that took a lot of buy-in from the team. And so there are certain techniques that you can use to get buy-in from some of your key people that are going to make that really go very smoothly.
Eric Bersano:
Yeah. The other thing I noticed you did was just the name of the law firm in general, it’s a law firm that can be passed down. Most law firms these days are named after their partners. Well, what happens if the partners want to retire? Now, they’ve got to find someone who’s going to either buy their name or buy the customer list and then have to rebrand it. So, you have a built-in succession plan where you can build this up and take it over to somebody else. And as a CEO, you don’t have to be the face of the company, you’re just the one who built up the company and can pass it on if you want to.
David Crum:
Yeah, it was a very conscious choice on our part. The firms used to have my name in them, and then I have a terrible name for that, so wasn’t hard to get rid of my name. But yeah, what it’s allowed us to do in those states is to have a bit more of an organic local feel to the practice.
Because all the marketing is a little bit different, the messaging is a little different depending on where you are in the country. Yeah. You’re yourself a great favor by taking yourself, pushing your associates forward, but still being responsible for being the face of the company. So that’s exactly right. When we changed the name, I stepped back from being the guy that was out there getting the business and doing that, and then I pushed my associates forward and supported them with marketing. And that’s really key to do that.
Eric Bersano:
Now, what would you say an expectation should be for… Well, let’s just start with the smaller law firm, family law. What should their expectation for growth be? Like, do you say at the six-month mark, you need to be here, or do you go further out than that? As far as the hurdles where they should be at these markers or those should be their goals as they’re building up their firm?
David Crum:
Eric, didn’t you read your email? It’s just 10x man, you just 10x it. It’s really easy.
Eric Bersano:
Right.
David Crum:
Well, I can tell you this. I can give you some really practical numbers that we use for growth expectation, at least for divorce practices. So, when your marketing’s really clicking and you’ve got good prospect flow, it takes us about 90 to 120 days to ramp up an attorney. So, when we’re budgeting out, we say, what is the marketing expenditure that would be required to keep this person busy or do we already have enough cases to keep them busy? And then we project out what they would make over that 120-day period for the firm as well as a paralegal, we look at those as a production team, and then it’s just a matter of doing the math. So, it’s about 90 to 120 days.
We expect with a paralegal attorney team, they should be bringing your firm about $20,000 to $25,000 net a month before you’re paying their benefits. So that’s after labor. So growing law practice can be very predictable and very data driven as long as you have access and control over your own data.
Eric Bersano:
Now, building up a team, the hiring process is its own challenge, right?
David Crum:
Yep.
Eric Bersano:
How do you do that? How do you look for attorneys? Do you think about culture? Do you prefer someone who’s just out of law school? Do you prefer someone with some experience? What advice would you give there?
David Crum:
Well, it’s funny that you asked Eric, because we just had a long talk about this last week. I would say, this is what I’ve learned. First of all, we learn to modify the way that we pay attorneys, so we don’t pay a salary and bonus.
I mean, we start with people like that, but they’re eventually on a built and collected model. And if you’re executing correctly, that should allow your attorneys to make significantly more than the average. So, when people come in, we often pay them one and a half hours, sometimes even two times more. So, the money perspective or the money aspect of this makes it easier for us to recruit, even though I would say talent and recruiting is the biggest challenge, bar none for growing your practice in this environment.
So, it’s about the right compensation model. And then what I honestly start looking for, I look a lot at someone’s background and the story they tell me of their journey to become an attorney. And what I’m looking for is perseverance, examples of grit, people that are going to have some toughness in this environment. Because attorneys are dropping like flies post-pandemic, and it’s frightening to watch. An example, I interviewed a woman and when she went through law school, she was making a two-hour round-trip drive to night school to go, and while working a job during the day and having kids and all this kind of stuff, that woman I hired immediately.
And she’s been phenomenal. Experienced anything more thing, we’re looking for that personality and that mental toughness that seems to really pay off when they come onto the team.
Eric Bersano:
And for you right now, how quick are you growing? I know you’re doing a lot of hiring; you’re going into different states. One thing you mentioned before we jumped on was growing by acquisition. Is that more of the plan now? And do you have to be at a certain level to have that mindset?
David Crum:
I don’t think you have to be at that level to have the mindset. So, what we’ve decided, when I started in Denver, we did that as a big launch. We financed that with an SBA loan. I mean, we just went all in on that. I would not do that again. Now that we’re going to locations, we’re just getting a small office that can be expanded.
We’re hiring one or two people and then folding the expenses into our own. So, these are all self-financed. You don’t have to be at a certain level to do that. So, you’re either going to grow your own firm and its location. You’re going to grow in another location within your state. You’re going to pick another vertical or you’re going to go outside of your state if that’s a possibility. But in terms of what you mentioned, we have discovered… Because we’ve been what I call green fielding all of these. That means we just start them from scratch with our own money from zero up to full practice. A lot of companies overlook this idea of growth by acquisition. And so, now what we’re doing is when we are marketing or recruiting, we’re telling people, “Hey, this is also a great opportunity for a practice merger.”
If you’re solo or if you have multiple associates and you just can’t make it work, you can join our team and we can preserve what you have. We just did this in Grand Junction, Colorado, and it’s been amazing. I mean, we had a team built in, infrastructure, great reputations. I mean, it’s not easy to find but you should be on the lookout for it, for sure.
Eric Bersano:
So, your growth obviously stems a lot from the marketing that you do. And as far as the nuances of marketing for family law, and you had mentioned of PPC. Obviously PPC is as long as it’s a good campaign that can get you immediate results. SEO, I think, should be part of anybody’s plan. Social media to me seems like a buzzword that everybody wants to be part of, but I don’t know that everybody does it well.
So, when it comes to those three things, can you walk us through what you’ve learned and maybe eliminate a lot of pain for some of the attorneys that are listening?
David Crum:
Yeah, you make a very, very good point. Everybody wants to be on social media, and social media comes with its own challenges. One of the nice things is that I don’t think right now there’s any platform that’s more targeted than say, Facebook. However, for divorce attorneys, they make it very difficult. And you’re going to see that social media is starting to take away a lot of the tools that we used to have to look at our data. So social media has got to be data driven, and it’s got to be more than just putting up an ad with a link to your website, for sure. What we’re doing is listening to clients and seeing what they’re talking about.
And I’ll give you an example of one social campaign that works well for us. We started this year ago, we kept hearing women saying, “I’m divorcing a narcissist.” I went to the DSM-5, and I said, this is what narcissistic behavior looks like. This is how you would deal with that in a divorce. You create some proprietary content; they opt for that and then you pitch them on a consultation. So, you’ve got to have this custom landing page, you’ve got to have this tailored messaging, and then a way to follow up. That’s why I think most people are missing social media as well as income targeting. If you’re not income targeting, you’re going to get a lot of wasted leads.
Eric Bersano:
What I’m curious about with social media is there’s really two different ways to market on social media. One is organic, where you’re posting photos of you, you are posting your content. And then the other way is a paid advertisement. Now, I’m curious if you found an 80 20 rule where… Or if you say, “Eric, just ditch the organic stuff, that’s all paid,” or is it vice versa?
David Crum:
Oh no, I make my team explain to me every week like, why are we doing so much organic posting on social? Because nobody sees it. You can put out a great piece of content. I mean, it’s fascinating that you can have that many followers and they won’t even show content to your own followers. It’s going to be mostly paid. So, we’re running ads, and what we’ve also found is if you’ve got attorneys or anyone on your team that can shoot short videos, that’s provocative. Boosting posts on Instagram is a nice way to do that.
So, if you’ve got a really hot piece of content, you don’t need to make an ad out of it. You can make a marketing piece and then boost it to a target audience. And that’s where we’ve had good experience, but that’s also builds your following.
Eric Bersano:
Now, can you define a hot piece of content? Because I don’t know if it’s you doing a TikTok dance, or are you talking about something that’s real informational?
David Crum:
We’ve got some young people on the marketing team that make me do these damn viral Instagram Reels all the time. They get a kick out of it, it’s fine. An example, I’ll turn a piece of content that someone might write, and if you just change it a little bit, it becomes much more interactive. So, we were writing an article about, or I was creating a video about how people… The games sort of what they do to avoid paying child support sometimes.
And we titled it, Games Men Play with Child Support and just people went bananas, right? We just got thousands of comments. It’s knowing what’s going to get somebody’s attention. And unfortunately, it can sound a little clickbaity sometimes, but as long as you deliver what you’re promising, I think you’re okay.
Eric Bersano:
Yeah. I’ve got work with an employment attorney who takes clips from The Office, the TV show, The Office, and then just says what type of employment case they may or may not have with that.
David Crum:
Right. Right.
Eric Bersano:
Which I think is brilliant because [inaudible 00:19:24].
David Crum:
It is, it is brilliant.
Eric Bersano:
Everybody knows The Office and you’re relating it to your practice area. So with that being said, have you now, because you’ve been doing social media so long, do you have people come in and go, “Oh, I saw your Instagram feed or your Facebook,” or do you still feel like you’re building up that recognition to where it’s paying off?
David Crum:
Yeah. And I’m involved in some other businesses too, where social media works in a vastly different way. And so, the problem is with any other business, my wife has a business now that’s an herbal company that she runs. And on social media, she’s building a loyal following of people that are going to purchase their products and interact with her for years to come. The problem is you don’t really do that, especially in divorce. They’re kind of in and out. Social media is definitely not the silver bullet. If people think it is, it’s going to add a few cases a month. As long as you have a positive ROI, you can run it, you can get some exposure beyond the ads and beyond the clients. But in my experience, no matter how good you do it, it’s not going to break any records for your content.
Eric Bersano:
Yeah. In my opinion, the paid social ads are the way to go, but you need to have a professional profile when they get there.
David Crum:
Yeah.
Eric Bersano:
You want to have nice photos. If it’s Facebook, you might have a couple of articles posted, but I’ve talked with people before that say, “Well, what can you do for social media? And I need to write eight posts a month.” Yeah. If you’re selling shoes, you need eight posts a day.
David Crum:
Yeah.
Eric Bersano:
But if you’re an attorney, no one’s going to go, “God, what family law or personal injury attorney can I follow today?”
David Crum:
Right.
Eric Bersano:
It’s just a complete timing thing. And in my estimation, you want to have a professional type of a profile approach, but you still want to be out there, so you seem relevant.
David Crum:
Yeah, let me comment on that. That’s interesting. We are just looking at this, and I think this is important for people to understand. There’s this tendency now for people to just say, “Hey, just turn on your cell phone.” And it doesn’t need to be fancy. And to some extent that’s true depending on where you are. But when it comes to photographs and some videos, it can actually harm you to have a bad photo or a bad video. So, here’s an example, we had a client, and their ads just weren’t performing like we would expect. And when we looked at their photography assets, my CMO said, “This is not a great photo whatsoever of this team.” And I was like, yeah, it’s pretty sketchy. So, we tested their photo against a landing page without a photo, and the landing page without the photo outperformed in a fairly significant way the ad with a terrible photo. So, the takeaway is, listen, you’re better off not putting a photo if it’s terrible or not running a video if it’s horrible.
So, there is a certain level of professionalism. If you’re posting on Instagram, turn your phone on, you don’t need a production company. But other things where people are landing and looking at you, do need to be professionally done.
Eric Bersano:
I’m glad to hear you say that and provide a real-world example behind it, because I push video on everybody. I say, “You’ve got to be doing video now. It’s just the way people are used to consuming things.” And I say, bad video is going to be bad for you and good video is going to be good. And I say, the two things you need to do are you got to make sure you have good lighting and good sound. And then there’s a bunch of ancillaries around that. Like I tell people, if you’ve got a messy desk, people are going to be watching your video, looking at your desk and not listening to what you’re saying.
David Crum:
Yeah.
Eric Bersano:
So, you really have to take some care. But if your lighting is bad or your sound is bad, you might as well just never post it.
David Crum:
Yeah, sound quality seems to be another thing that people… And this is not easy, I think this is an area of marketing where everybody, especially small businesses and law firms struggle, because it is really hard to produce a lot of quality video content. I mean, we have a team here that does that, and we have locations set up. I mean, it’s definitely a challenge. And so, you need to find the quickest path to being able to produce that content.
Eric Bersano:
So, let’s shift gears a little bit here. So, we’ve talked about your successes growing the firm. One of the things you mentioned in the document before we got started was turning a disaster into an opportunity. Now in that sense, because everybody’s going to go through it, if you’re trying to grow, you’re going to be taking risks and some things can happen. What do you mean by turning a disaster into an opportunity? Or do you have a story about where that happened to you?
David Crum:
Unfortunately, I do have a story. When I was a young attorney, I spent a lot of time on personal development. So, everybody that was there I was listening to, and before he became super famous, Tony Robbins was somebody that I listened to like, when he was still doing late night TV infomercials. Anyway, he had this little power question that he taught people to ask which was, “In the face of adversity, which is how is this the best thing that ever happened to me?” And I started asking that question with a lot of problems we were having. But the biggest problem we encountered was in the middle of our launch in Denver, my team in New Mexico basically staged the coup. They just walked out, four attorneys, two paralegals, I think it was about a hundred thousand dollars a month or something in income that was walking out.
It was a disaster. It was actually a sort of existential threat to that firm. And so, I said, okay, I got pissed off for a few minutes for a very short time. And said, “Okay, how is this the best thing that ever happened to me?” And what I discovered was I had developed a lot of toxic relationships with those attorneys. I had become complacent as an entrepreneur, and I knew that I just wasn’t doing the things that I did. So, it was an opportunity to rebuild the team bigger, better, more successfully, and more profitably. And that was the goal we set. So, it was super painful, but the core team set those things, we’re going to come back bigger, better, and more profitable than before, and we ended up doing that. So, it is a very, very helpful question. How is this the…
And in fact, I have my divorce clients. When I had clients, I would ask them that same question, how is your divorce the best thing that ever happened to you? And if you really answer the question, it’s not bullshit, it’s not just some self-affirming nonsense. It actually gives you actionable, exciting items to work on.
Eric Bersano:
Yeah, I think having that perspective allows you to think it from a different angle. One of the quotes that I love, I heard this years ago was, “Nothing is ever as bad as it seems at first.” So, whenever you get really bad news just, “Oh my God, the world’s crumbling, how am I going to get out of this?” But just separating with even just a little bit of time allows you to look for those other angles. And I’d like that approach to it where like, okay, if I were to shift this 180, what would it look like to me?
David Crum:
Yeah. A couple of things, I’ve learned to see things as they are, not worse than they are. And then the other piece of info that I’d leave your listeners with is, it’s often not the actual immediate thing that really hurts you or kills you, it’s the thing you do next. It’s the thing you decide to do next. When these people left, could I have sued them for what they did? Absolutely. That would’ve been bad. That would’ve been a bad decision, right? So, it was like, they’re gone. I could do this, but what I should do is just forget the hurt feelings and just focus on getting back on track. And so, avoiding the immediate landmines, I think is another thing that you need to do to overcome one of these problems that is a real threat to your practice.
Eric Bersano:
That’s interesting. You say, I was reading a book that was talking about airplane crashes, and it says that airplane crashes are almost never one issue, it’s a compounding of issues.
David Crum:
Yep.
Eric Bersano:
It’s bad weather, and then it’s a sleepy pilot, and it’s the same thing it sounds like with the law firm. It’s not that one time when four people walked out, it’s how you handled it after where you were able to correct it-
David Crum:
Yeah.
Eric Bersano:
… And keep the firm moving forward. We’re almost out of time here, but I wanted to ask, and I assume you get hit up for advice all the time, do you talk to attorneys of all practice areas or do you just stick within family law if somebody wants to reach out and maybe find out more about what you do?
David Crum:
Yeah, I love talking to other attorneys. So sometimes people will just reach out to me, and they’ll be doing things similar to what I’m doing, and we’ll just kind of have a relationship and talk a little bit. Right now, in terms of clientele, it’s divorce and family law.
We do have a vertical in estate planning, so we have some of those clients. And then I have a background in criminal offense, so we work with those people as well. But what I would really encourage people, and this is crazy, like never would’ve said this a few years ago. Right now, one of the most important things you can do is intently focus on your team and their emotional health. Because Eric, I mean, the pandemic was bad but the attorneys listening to this know that was survivable. We didn’t get close. We were essential. We could limp through that. What’s happening now is the really hard part. Everybody’s falling apart, they’re stressed out, they have a lot of significant emotional issues, and we’ve lost a couple of a… We don’t have much turnover, but we’ve lost a couple of employees purely on emotional and psychological health issues.
So, this is a very, very threatening time. And it sucks because most people are worried about, “Hey, what’s Joe Blow doing across the street to undermine my business?” And now you have this whole other thing coming at you, which is really hard to manage, especially if you’re small and attorneys just don’t talk about this stuff. You just don’t eat, you don’t sleep, you just work, work, work, drink coffee, wake up, and it just doesn’t work. We’re seeing a lot of people burning out.
Eric Bersano:
I really appreciate how open you’ve been to sharing not just the successes, but some of the challenges that you’ve faced as well. So, any place you’d like people to go, if they do want to reach out? We’ll put your website and everything in the show notes, but do you have any books or anything that people can look you up on?
David Crum:
Yeah, I think the best place for people to go is just to go to our website, cardinalconcepts.com. That is a website that’s geared directly for divorce and family law practitioners. There’s some very good information on that website. You can see my story. You can see some case studies and how we’re using it and see what our websites and so forth look like. So that’s a great way to start. I’m on Instagram at the_divorce_assassin, and that’s only because I wrote a book called Confessions of a Divorce Assassin, so you can find me on Instagram too if you’d like.