Winning Strategies for Scaling Your Law Firm

We're back with another episode of "The Small Business Show," and this time we're sitting with the industry-reshaping attorney and entrepreneur Luis Scott. Co-founder of the Eight Figure Firm Consulting and Beta Scott Injury Attorney, Luis is a known advocate for empowering legal professionals and entrepreneurs to step out of the comfort of their office desks and unleash their entrepreneurial spirits.

Guided by Luis's rich experience and extensive knowledge, this episode breaks down the change lawyers must make to transition into successful business owners. A milestone Luis believes can be reached through systemizing operations and incorporating team efforts to power the engine of the business. Learn the ropes in overcoming challenges to reach the ultimate goal, of not only creating a legal startup but headings steering it towards the road to becoming a seasoned enterprise that can function without micromanagement.

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Transcript

0:16

And growing a small business. The small business show is the official podcast of Garuda promo and branding solutions. Hello everyone, you're listening to the small business show. My name is Swire. You can also call me the promo guy. Today we're with Lewis Scott, a highly respected attorney. So the speaker, author and dynamic entrepreneur. Co founder of eight figure firm consulting and beta Scott injury attorney. Lewis entrepreneur Spirit has revolutionized the legal profession. Join us as you share insight, inspiration, stories and enviro wisdom to empower the legal professional and entrepreneur on the journey to extraordinary success. Welcome to the show Lewis. Thanks Swire. Thanks for having me on. Looking forward to the conversation. Yeah, I love to find out a little bit more about your background. So from the way that you built your own law firm, now you're coaching other law firm to be successful. Can you tell us more that so I always had a heart of a teacher. I wanted to be a teacher. And then I realized teachers don't make a lot of money. And so I said, you know what, I need to go become a lawyer. My parents used to always tell me I was going to be a lawyer one day. So I became a lawyer. I realized that I didn't really enjoy being a lawyer that much. I enjoyed still the teaching aspect and the business aspect. And so once the law firm had gotten big enough to where I could actually teach people what I had done to become successful, I started the consulting business and started helping other law firm owners learn the strategies that helped us develop an eight figure business. We're talking off camera and I actually know a few attorneys myself and there are a hot bunch to change mindset. So is it, is it really tough working with other lawyers and law firms? Absolutely. I mean, lawyers in general do think that they're the best at whatever they're doing, even if they're doing it wrong. And so working with lawyers requires you to help them change their mindset, their perspective. And as you know, changing the mindset and perspective of people takes time. And so, yeah, it could be very, very challenging. And I could tell you specific experiences where I've worked with a lawyer for months on months on months telling them the same thing over and over. And then one day they come to me and they go, I had an epiphany. This is what I should be doing. And I'm like, I've literally been telling you that for five months. But yeah, it's very, very challenging sometimes working with lawyers. And I think not only for lawyers, it could apply to a lot of service professional, especially if they're highly educated, right? Because they. I have the degree. I have, you know, been through all this experience, and, you know, now you want me to change? Like what? I think some of those are the struggle ones. And you mentioned it pretty well when we were chatting. You know, can you talk about the mindset for being a professional by yourself than actually owning the business in that particular field? When you're the professional by yourself, you really just have a job. You know, when you start your law firm, or let's say you start any service based business, it could be a product business, too. You really just have a job. You know, we have some friends recently who started a clothing business. That clothing business, they're having to work every single day, so they're really employees of the business. But when you become a business owner, now you have a system, and you have a team of people who run the business. And so the transition is moving from the place where you do everything. You have to do everything, you have to be the beginning and the end to hiring people who do the work and that you pay so that they can continue the system that you've developed. And that's what being a business owner is all about. At the business owner stage, the business runs relatively well without you. Maybe not great, maybe doesn't grow great without you, but it will definitely run relatively well without you. How would you suggest someone who always do it themselves, who are really, really good at what they do, you know, trying to give little tests to the staff, or maybe a colleague, uh, to delegate? Like, what would be the first step to get them out there to delegate? One of the things you have to understand is that it doesn't matter how good you are at anything. Like, let's say I was a mechanic, and I was the absolute best mechanic at changing oil. There's only so many cars I can do per hour. And so if I wanted to grow my mechanic shop, I would need to hire people, even if they did 80% as well as I did. If I hire ten people to do cars, they could do ten cars an hour, where I'd be doing one an hour. And so I think the mindset of delegation is this. Use the skill sets and the education of people to leverage your business. Like, create an environment where other people's resourcefulness and usefulness trumps anything you could do on your own. And so you may be the best at building cakes, but ten people making cakes will make cakes much faster and many more cakes than you could just doing it by yourself. That's great example. However, I think if I'm on the other side, I will ask you this for a question. But they don't do it as good as I do. When I watch them do it, I get agitated. Right? I have to stop them. I have to correct them. So, like, how, how would you really coach them? You should maybe back up a little, let them do it, maybe make a little calculated mistakes, and that's how they grow. Like, what would you suggest to people like that? The first thing that I would ask the person is, are you, are you trying to reach a level of perfection or are you trying to reach a level of excellence? And those are two different things. A perfectionist is the type of person who never thinks anyone can do it as well as them. Where if you're looking at it from excellence, excellence could be a standard below perfection. And here's the reality, is you can't actually reach perfection anyway. And so if you're having a hard time letting go, you really need to ask yourself, is your standard way too high for what the customer expects? You know, when I go to a store to get a service, I don't expect them to go above whatever I'm paying them to do. I only, I only expect to get the product delivered the way that I want. And so a lot of times the owner is trying to deliver a product that's not necessary. And I'll give you an example. A while back, we were talking to the former CEO of the Ritz Carlton, and he was saying that when a person comes to the Ritz Carlton, they don't expect gold plated sinks. That's not what they expect. They don't pay for that. And if you're, if you're the owner of a business where you're trying to deliver gold plated sinks and the customer doesn't expect that, then you're never going to be able to delegate anything to someone who delivers under the gold plated sink. And so really find out what your customer expects and deliver that. Don't try to go so far above and beyond that. No one can actually replicate what it is that you're delivering. So that's a really good example, you know, like doing that in a real life, you know, maybe using the industry standard, right. Using maybe a customer survey, like what people expect off you, right? Maybe not gold plated sink, but nice house will be nice. So that could be the standard that you set. And. Yeah, and you're right. It may not be 100% if you yourself would have done it, but if you are able to hire, you know, people who could do it 80%, you know, even 60%. But if you're a lot more of them, your productivity will be a lot higher. Absolutely. I mean, production, if you think about the assembly line worker system, more cars come off the assembly line when you have thousands of workers than if you were building it one by one. Rolls Royce builds their cars handcrafted. Right. It takes a whole year to build one of those. They can only build so many of them, and so they have no choice but to charge three, four,$500,000 for a car because it takes so much energy and effort to build them. But that's not resourceful. You're not going to reach a lot of people selling Rolls Royces of your service. You'll reach more people selling Lexus. Great quality. It's going to last you a long time, and you get an assembly line of people and they're just popping those things off the assembly line. And so if you want to grow a big business that runs without you, you can't sell Rolls Royce where you're having to do everything yourself. You need to sell a Lexus that's still going to deliver great quality. It's going to meet the expectation of the consumer, and there's going to be more consumers out there who can afford that kind of, that kind of product. So that brings me to another question. You know, as a service provider or as the business owner, the entrepreneur, you're passionate about what you do. You're good at what you do. You really wanted to make your business to be successful, but, you know, sometimes the challenge will be when you try to hire someone to take on some of the tasks, they're not as motivated. They also, they're less skills than you are, so that makes it challenging. Right. So they don't really want to do that. And especially for a smaller business or a smaller firm, they might not have the resources to spend a lot of money to find the best talents. What would you say to that? I mean, I would say to them what I heard recently, Gary Vee say, which is, yeah, of course they're not going to work as hard as you or as diligent as you or as much time as you, because they don't make enough economics, they don't make the same amount of money. Right. And so when somebody is not making what you're making in your business, they're likely going to be less motivated to put in that kind of work and energy. And one of the philosophies that I have is that you build the business with the talent that is available to you at the time that you're hiring. And what I mean by that is, when I'm a $1 million business, the talent that is available to me is going to be less than the talent that is available to me at a $10 million business. And it's going to be less than the talent that is available to me at a $20 million business. When we took our business from a seven figure business to multi eight figure business and now to $40 million business in the legal space, we can afford talent that we couldn't afford before. Build the business with the talent that is available to you. Maximize their output, maximize their production. And then when you can afford something more, if that person hasn't grown with the company, then you hire someone to replace them and you let them find the job of their dreams. And so whatever you're, whoever you're working with, if you want to grow a business, you have to get comfortable working with people who are going to disappoint you because nobody is perfect. Nobody can deliver at the same quality and level that you can. In fact, my dad always tells me they're going to work at about 70% of your ability, and so get comfortable with that, and then the hiring game will become much easier. Yeah. And then I think if you are really good at, you know, finding the talent, you know, personality plays a long way, too, because, you know, for a detail oriented person, maybe something that do a lot of data, maybe outgoing individual should be in business development, then vice versa. If you put the wrong personality into the wrong department, per se, you know, so that's sometimes, you know, the argument comes in. Yeah, I mean, obviously, putting people in the right seats is really critical. And I think a lot of times we try to fit people into the hole instead of asking, what do I actually need? And we hire out of desperation because we just need a warm body. We feel overwhelmed as entrepreneurs, and we just need somebody to take something off of our plate. But what I always say is when you got into being an entrepreneur, it was sacrificing the 40 hours job because you were going to work 80 hours. Unfortunately, that is a cliche that has rung true for many entrepreneurs until you can find the right people. And so just don't hire out of desperation and don't try to just squeeze people into things that they can't do because you're going to be disappointed long term. Let's go into some specific. I really love to ask you questions about growing law firm because I, in my line of work, I have worked with law firm, they're my clients, and also have friends who I told them, I'll ask you this question and let's set the stage right. I'm in California, Los Angeles to be precise. And people drive a lot and there's a lot of things going on. I can pass by a day without seeing billboards for attorneys. I can't go to restaurant without seeing placement with attorneys. I can listen to the radio for maybe two commercial break without jingles from attorneys. So it is competitive in Los Angeles and I'm sure in the rest of the country as well. So if a firm come to you say, Lewis, I'm committed, I want to really grow to a figure firm. What would be the first thing that you tell them? Well, it depends, because, you know, every firm is in a different space. And so we're generally working with firms that have already reached seven figures in income. Now we will take a firm that is 600, 5750 thousand in revenue. But generally speaking, they're already at seven figures in revenue. And every firm that comes to you, comes to you with a different problem. Some of them have hiring problems, some of them have retention problems, some have marketing problems, some have sales problems, some have production problems. And so depending on where their issue is, that's where we're gonna start the person. But we do have a process. It's a three year journey. I believe we could take every firm or any firm from 1 million to 10 million in five years or less using this journey. And so first it's identifying where that firm is tackling that problem, and then interjecting them into our three pillar system, which is foundation, intention and transformation. So, but before we interject them into that system, we need to triage the problem that they're undergoing. If it's a marketing problem, let's write out your marketing plan. If it's a hiring problem, let's develop a hiring plan. If it's a retention problem, let's develop an employee retention plan. If it's a production problem, let's figure out the right KPI's. If it's a system problem, let's do the policies and procedures. So we identify the problem, we triage that issue, then we interject them into our three pillar system. And if they do it right, in five years or less, from 1 million to 10 million, and we generally can get them at 20% to 25% profit margin. So that will be really specific coaching experience where, you know, this is what you have, and obviously you ask them what the goals are, right? What do you willing to see yourself to be? Because I see that, you know, for the ones that really committed and think like an entrepreneur, then I think that's the mindset change that we talked about initially. But you do want, it's not something that you have to grow to a figure firm, but then to, in order to do that, you have to change certain things or maybe add on and subtract a little things in order to get there. Is that right? Yeah. I mean, the first thing is identifying whether you are the person that wants to reach take figures. There's a statistic from the small Business Administration, and I have this particular slide that says that one out of 667 companies reach eight figures in revenue. Now. People go, well, there's so many companies that are 10 million in revenue. Yes, because only the strong survive, but only one out of 667 actually do it. So if 667 people start, only one of those is going to be eight figures and they're going to stay at eight figures. And then out of the next 667, one is going to start, but now there's going to be two a figures, and then out of the next 67, one is going to make it and there's going to be three a figure. So the fact that there's a lot of eight figure firms is only a testament that they were the one out of the 667 firms that reach. So the first question is, do I even want to try to attain that level of growth and success? Because it's not for everyone, and it's going to require a complete change of who you are in order to do that, and a sacrifice in what you believe and what you think about business in order to make that achievable. So assuming that that's your goal, then yes, it's going to take a tremendous amount of sacrifice to reach it. But there are plenty of people in the service based business that are comfortable and satisfied with the three, four, five, $6 million business. Those businesses still make the owner seven figures in personal income. So you don't always have to get to eight figures to earn seven figures in personal income, if that's your goal. But to reach the top, you're going to have to put in a tremendous amount of work. I normally help a lot of people with their marketing efforts. So let's assume a marketing question. Do you think lawyers are not marketer, or do you think lawyer should learn to be a marketer? Or, you know, maybe during the transmission, you know, they would need to think more like a marketer. Because the mindset I could see is totally different. Right? Yeah. I mean, if you're a lawyer that has a law firm, you tend to not think about your business as a business. You tend to not have a marketing plan. And that's one of the reasons why back in the day, it was if you did good work, you'd get, you'd get repeat business. That's not the case anymore. The best marketers get the business. And so if you're a lawyer or you're any service based business and you want to grow your business, you have to spend money on marketing and you have to become a marketer. And one of the things that I always tell my clients is you, you know, are business owners, marketers first and lawyers second, and not the other way around. Because if you are a lawyer first, you're going to make decisions based on being a lawyer. And generally that means waiting until you have people walk in the door, knock in the door and hope that that's enough to support you. Where if you're a business owner and a marketer first, you are proactively engaged in the process of acquiring clients, and that's going to set you apart from the majority of the firms that are out there. Before we hop on, I saw one of the video that you post on LinkedIn is, you know, when you get calls come in, when you get people contact you, do you know where they came from? Not just, you know, law firm for a lot of company? Where do people come from? Why did they choose to work with you? Do you even know that, like when you, you have an actual playing client, have you actually do an exit survey, you know, find out, you know, do you have choices out there? Why did you pick to work with us? A lot of company actually don't do that. And I think, in my opinion, that's one of the goldmine that you could do. Because if people find you a certain place, that that's where you want to be. And if people think that you are funny, you tell more jokes. Absolutely. And I, well, the thing is that I think I'm funny, but I don't know if some people think I'm funny. But, yeah, if you, if you think that you're funny, you should tell more jokes, for sure. I mean, here's the thing. You have to identify what your goals are. And I think a lot of, a lot of people, they live in a world where they live by the standards of other people. They want to achieve the goals that other people have set for them. And I think the most important thing as an entrepreneur is knowing what you want in your life, knowing what you want out of life and pursuing that. And it's not the same for everybody. And that's why it's so important that you know what you want. You know, I have a vision board in my house, and my vision board is absolutely terrifying for some people, right. Because I have, you know, the private jet on there. I have the multiple houses in multiple states, and I have the, you know, the twelve car garage. That doesn't excite some people. That doesn't matter to some people. And so you have to know what you want out of life and then pursue those things and know what you're trying to achieve and don't live by the goals and the standards that other people have set for you. I think that's key to success, you know, because, you know, you want to be Elon Musk, but do you want to really do what Elon Musk is doing? And so. He was sleeping in the factory, working, you know, 120 hours a week. And, like, most people aren't willing to put in that kind of work. And so know what you want, be comfortable with, with what, what you want, and pursue that. Do you think that's the hardest thing to get out from an entrepreneur that you consult with, you know, to get, really get them answer you honestly, right? You know, obviously, they, if they, if you ask them do you want to apply for jet, everyone will say yes. But, like, if you follow up with more question, I would think that most likely a lot of them wouldn't say yes. No. They don't want to see, like, the thing that I realize is we want to attract people into a figure firm consulting that want eight figure businesses. But there are people who think they want an eight figure business, and then when they realize that they're going to have 50, 60 employees and the headaches that come with 50 or 60 employees and the headaches that come with managing this big business, they realize that, no, they just want, you know, a three to $4 million business. And so don't be driven by what other people tell you is success. Eight figures is not success to everyone. Some people, success is just having a small little business. Some people, it's not even having a business when, you know, I call that the difference between the entrepreneurial spirit and the nine to five spirit and the creative spirit. Everyone has a different spirit, and everyone is comfortable with different things. And so it's totally okay to live the life that you want to live. Don't be driven by other people. And I think entrepreneurs need to learn that the success of an entrepreneur is not determined by a private jet or Rolls Royce or expensive bags. It's determined by what you believe is success. Like, for me, it's not even any of those things. Even though those things are on my vision board. Success to me is ultimate freedom, meaning I can go and do whatever I want and I don't have to look at my checkbook, at my wallet. I can just charge it and make it happen to me. That success, wow. If I do that, then I don't need to do anything. Like, I don't want much in my life, like, for the things that I want to do. Like, it's. I live a modest life. So that makes you happy, too, right? If you always think of something that you could have won if you do x or if I sacrifice more sleep, I could get that. So once you have that, you might not be that happy, would you? Have you seen examples like that? I can't even tell you the amount of people who have achieved what they wanted and then they didn't. They weren't happy. And, you know, there's a meme out there that I saw that says, what are you going to do when you get the very thing you've been hoping for all your life? That's what you really need to answer. What are you going to do? And for me, I knew what I was going to do because for me, impact was so important. Like, I have a personal vision statement to lead a life of significance. So I knew when I got everything that I always wanted, when I got the money that I wanted and the comfort, comfortable lifestyle that I wanted, I knew I would have something to pursue because I want to be a public speaker and an author, and I want to be able to impact people around the world. And so that's what drives me more than the money. The money's good. I need the money. My family needs the money. But that's not what drives me at this point. It's because at this point, I'm beyond where I wanted to be. And the question that I had to answer is, what would I do when I got here? And this is what I would be doing, speaking, writing, consulting, and helping other people. So you would suggest that once we reach a certain milestone, we need to rethink what is exactly that we want to do. Do we want to stay or do we want it to really double down and grow? So then, like, how often do you suggest people think, and, you know, where, where they are and where they want to be? For me, you know, you set up a three year vision, but I review it yearly. Like right now, I'm thinking about 2024. And I'm asking myself the question, what do I want for 2024? And this is a funny thing to say. When I started consulting, and this is for people out there who are thinking about consulting or doing any kind of service based business, I started charging $2,000 per month, and today I charge 12,500 per month for the same service. And the reason is because I had credibility and I've been able to get enough people to desire what service we're providing. And I say that, to say that at some point, I don't want more clients. At some point, I don't want to continue to do what I want to do. So when I'm thinking about 2024, because I reevaluate every year, I ask myself, what do I want in 2024 out of my consulting business? Do I want more clients? Do I want a bigger reach? Do I want bigger impact? Do I want to elevate my team? Which is what I'm really focusing on now, is taking the team that I have and elevating them so that they have a place. You know, I'm co writing a book with, with my director of operations so that I can elevate them. To me, that's more important than me taking on more clients and making more money. I want to help other people be elevated. So I am in the continuous process of evaluating where I am and what I want out of life so that way I can make decisions that not only impact me and my family, but also impact positively the people who I serve. Yeah, that's the right mindset. And I truly believe in givers gain. So if you keep on giving, at some point people are going to reciprocate and see how they can help you. Louisiana so you're doing it correctly. And I agree. There's, there's a, somebody quoted a verse the other day that said that all labor is profit. And I think that that's so true. It's everything that we do is profitable for our life, whether it's helping someone else, helping ourselves, helping our family, helping our mindset, improving our minds, our emotions, our body, everything is, is good when we're doing things that are to help people. So let me ask you this question. Knowing what it takes to, you know, style law firm, build a successful law firm now coaching other to build a successful law practice for aspiring attorneys out there who might be in law school or maybe getting the bar exam right now, would you recommend this career? I would absolutely recommend the career. I mean, I think that lawyers play an integral part in our society. They keep our society safe because there is a system by which people can find justice and can resolve problems. It's not always a fun system because litigating litigation, arguments, things like that are not always fun. But it's a system that allows us to find some level of fairness in the world that doesn't exist in other countries. And so I recommend any person who wants to go to law school to go to law school, and anybody who enjoys the running of a business, the operations of a business, to absolutely entertain that, if that's something that's on their heart and their mind. Thank you so much. Lewis. You answered perfectly. So for law firms and want to be entrepreneur who wanted to find out more about what you do, what would be a good way to connect with them? Absolutely. They can connect with me by going to Luis Scott Jr.com dot, that's luisscottjr.com. And they can find all my links, social media, as well as my books. I have a couple of books that I've written and a couple more to come and as well, and my podcast and any other speaking engagements and so forth there. Thank you so much for coming onto the show, Luis. I learned a lot. Thanks for having me. Thank you for listening to the show. If you enjoyed this episode, please subscribe to the podcast and share with your friends or colleagues who might benefit from the conversation. Any questions or feedback, feel free to reach out to me on LinkedIn. I'd love to connect with you.

Our show is live streamed both on YouTube and LinkedIn every Tuesday at 10: 27:15

00 p.m.. PST. I'll see you next time.