Advancing case costs with a lawyer’s or firm’s own funds may seem a simple and familiar way to avoid debt. Many attorneys, however, have learned from experience that doing so means making interest-free loans to a client from the firm’s after-tax dollars, an arrangement that can cloud an otherwise zealous advocate’s spending decisions in a case.
Just as importantly, fronting costs oneself diverts money from significant personal and professional goals. Solo practitioners tying up their funds in cases can end up indefinitely forgoing investments in personal milestones, like weddings, student debt elimination, or a new home or car.
At a business level, small firms advancing case costs may miss out on superior revenue growth opportunities. A 2020 Thompson Reuters Institute report on firms of less than 30 attorneys highlighted areas in which different spending decisions could resolve challenges and increase profitability for small firms.
Small firms acknowledged longstanding challenges in acquiring new client business and spending too much time on administrative tasks and not enough time practicing law. Despite identifying the issues and at times setting goals around winning new business and improving firm management, few firms had implemented a plan to overcome their difficulties. Thus, small firms able to formulate and quickly act on a plan are likely to enjoy a unique advantage over their competitors.
On average, small firm attorneys reported spending 60% of their time or less actually practicing law. Their remaining work time went to meeting or speaking with clients (12% overall), managing the firm (11%), administrative tasks (10%), and growing the firm and marketing activities (6%). Firms with more attorneys to share in management tasks experienced higher percentages of time practicing law.
This data suggests that increasing attorney and support staff headcount can enable small firm lawyers to achieve more time practicing law. Investing in innovations to increase law firm management efficiencies or technologies—like eDiscovery platforms or video conferencing capabilities—to streamline their practice could also help to accomplish this goal.
Several development expenditures could pay big dividends in the long term when it comes to drumming up new business. Increasing the firm’s marketing budget, adding to attorney headcount, developing new service delivery models, and investing in Diversity, Equity, and Inclusion (DEI) efforts—a growing focal point for firms and clients—are but a few spending suggestions.
Employing professionals dedicated to managing billing and collections would assist with the reportedly increasing pressure that small firms, most acutely the smallest among them, face around getting paid by their clients.
Financial liquidity would also assist small firms with meeting goals involving attorney professional development and obtaining, expanding, or updating office space.
Built by and for plaintiffs’ attorneys, LevelEsq offers solo and small firms the tools needed to seize spending opportunities that will enhance their personal lives and nurture their business’ growth.
With Lawsuit Cost Financing, our litigation financing for lawyers, lawyers use our money to fund your case expenses so you can deploy your own capital toward meeting your goals. For added liquidity, free up cash by refinancing expenditures you’ve made on existing cases. Through a simple, automated application, you choose which cases to finance and the amount you will need for each case, then receive a financing offer within hours. Once approved, use our online customer portal to request funds as needed and receive them within hours.
Our one-of-a-kind lawsuit insurance, Litigation Cost Protection (LCP), available only from LevelEsq, mitigates financial risk to your practice by insuring costs advanced for a case. Use LCP on its own to recoup your out-of-pocket expenses in the event of a trial loss or use it in conjunction with our financing to cover the principal balance of your case cost loan if you lose at trial. With Litigation Cost Protection, you can expect peace of mind and a straightforward, hassle-free claims process.
Let LevelEsq be your sword and shield in your quest to take your practice and your life to the next level.