What I Talked About With Harvard Law Students

Yesterday I was privileged to be able to speak to students at Harvard Law School in a talk I titled "Law Firm Finances (and Other Realities): Explained."  My invitation came  from the office of career services, and I accepted with gratitude and alacrity. I anticipate giving a similar talk at Stanford, Columbia, Georgetown, and NYU law schools.

First, here’s an outline of what I presented.  And second, I have a question for all of you.

• Income and expenses of law firms; the P&L
  • With profound pressures on both components of the income statement
  • If we hew to the billable hour model, the components of revenue [rates x hours x realization] all face intrinsic limits.
  • Yet there are no intrinsic limits to the aspirations of PPP
  • Are we therefore facing a train wreck down the road, or, at last, the emergence of genuine alternatives to the billable hour
• The economics of  young associates
  • The reality is that $160K/year, plus benefits, plus rent/occupancy, plus other allocated overhead, is a very large number (in the neighborhood of half a million dollars, I estimated)
  • To cover that, do the math of billable hours
  • And you’ll understand why you’ll be in the office 60 hours/week or so
• The importance of picking a practice area
  • Based on intrinsic financials, such as leverage, of practice areas
  • Based on your personal temperament
  • Based on economic cyclicality of practice areas.
• The unprecedented importance of picking a firm
  • Single-tier vs two-tier?
  • Segmentation of the AmLaw 100:
    • The evolving structure of our industry
      • Truly global firms
      • New York City "bulge bracket" firms
      • "Formerly from California" firms
      • The "hollow middle"
      • The salience of geography
• And what it takes to succeed in this increasingly competitive, pressurized, high-tempo world:
  • Passion

I’d be interested in what any of you think about these topics.  I tried to put together the presentation by asking myself a simple question:  What do I wish I’d known when I was in their shoes?

And my experience overall? 

I feel privileged every day to work with some of the smartest people at some of the leading law firms in our English-speaking world, and I’ll tell you something:  These Harvard students are every bit their peer, at least if you consider them peers in formation. Probing, inquisitive, sincerely curious, asking deeply thought-provoking questions, appreciative and not a cynical bone in their bodies.

Now, my question:  Had you been me, what would you have wanted to tell these students?  Let me know.