Hey guys, welcome back to my channel, the best place for new and inspiring lawyers on
all things law school, the legal industry, and lawyering life.
In today's video we're going to be answering the question, how do you go about making partner?
Because how to make partner and how your life changes as a partner, and what that really
means and entails are things that are really kept under wraps by law firms and there really
isn't a lot of information out there.
And so those are the things we're going to be tackling today.
And then also be sure to stay to the very end of the video and I'm going to give you
guys a guide that you can download on how to start this entire process -- the first
step of it all, how to get that first job out of law school.
So if you're excited to get going, smash that like button and let's dive in.
So what does making partner actually mean?
Well, in the law firm world, at least in the U.S., there is one big promotional step from
associate to partner.
There's no real steps in between like there are in corporate America where you could go
from associate to manager to senior project team lead to vice president.
There really isn't a lot of in-between steps and so traditionally when a law firm said
that you were making partner, they meant equity partner meaning that you actually owned a
portion of that law firm, of that business.
But nowadays it's a lot more common to have a two-tiered partnership structure where you
have non-equity partners and then afterwards you have the step to equity partner.
The biggest difference between non-equity partner and equity partner as you can probably
tell is that a non-equity partner doesn't have equity in the law firm.
It doesn't have a co-ownership of that law firm and as a result not equity partners tend
to be called "partners in title only" or "glorified associates."
But I think that's a bit unfair to characterize it that way because making partner is still
a really huge deal even if it's non-equity partner status because not all associates
make it, it's not a foregone conclusion that if you go through your term in the law firm
that that is how you are going to end up.
And so it is a really big deal and the statistics are rightly widely reported, but one of the
ranges that is consistently out there is 30 to 50% of associates ultimately make it to
the partnership stage.
Next, how much do partners get paid?
So as a non-equity partner, you are going to be paid a salary and a bonus just like
you were as an associate.
And depending on the size of the law firm, it might be a big jump from what you were
making as an associate or it might stay in line with that lockstep structure that you
continue to follow as an associate.
So that doesn't necessarily mean that it's going to be a small amount of money.
It just might not be as big a jump as you're expecting.
So for example, in the big law salary and bonus structure, it suggests that a non-equity
partner would start off making about $350,000 with a $100,000 bonus for $450,000 that first
year, which is a ton of money by any standard, any measurement.
It just might not be a huge jump from what you are making as a more senior associate
in your eighth year, for example.
It could be something around the range of 15 to $20,000 more, as opposed to in a smaller
firm that jump might be a whole lot bigger.
It might be much more than you were making as an associate even though it's still following
that salary and bonus structure.
So how long does it take to make partner?
Well, every law firm does it a little bit differently.
But generally speaking, you're eligible for partner after your eighth year associate year,
meaning that January of what would be your ninth associate year would be your first year
as partner.
And so as you can imagine as seventh and eighth year associates, you are going to be working
a ton, billing a ton of hours trying to show the firm the value that you bring, that you
are an asset to that firm, and that you deserve to be on that partnership track.
Unfortunately, just because you make partner does not mean that that workload is going
to slow down.
So how much can you expect to work as a partner?
Well, once you make partner you are no longer only expected to do the substantive legal
work of the cases and deals that you have traditionally worked on.
The entire point of being a partner is to contribute financially to that law firm's
business, i.e. develop clients.
And so most law firms understand that as a new partner it does take time to develop a
reputation, to be known in your field, and to really earn the trust of clients to actually
hire you personally to represent them.
And so there is going to be that transition phase, but you are going to be expected to
start reaching out to potential clients, to make yourself known in the local legal community,
and to start going on client pitches and and negotiate engagement letters and billing rates
and that sort of business development activity.
Unfortunately becoming partner doesn't create just a beautiful, natural divide between substantive
legal work and client development.
And so more often than not you're just going to be pulling double duty and doing both.
And, once you have those client relationships and you have that book of business, yes, the
law firm will put value on those relationships that you've created.
But unless and until you have that client book of business, you are going to have the
role of a support partner, i.e. supporting other partners that have cases and deals and
clients of their own.
And so you can expect in that role to continue billing the same amount of hours you are billing
as an associate regardless of your level of seniority as partner.
So what is the process of actually making partner?
What does it look like?
Well, every law firm does it a little bit differently.
But, an example of how this could go down is, at the beginning of the year, the law
firm makes a list of all of the associate candidates.
So, for example, all the associates in their eighth year.
At some point in the year, then the board of directors or the equity partners who's
ever in charge of making the decision, will meet and discuss each of the associate candidates,
and they may also call the associate candidates in for an interview to talk about what their
value they feel like they bring to the firm is, going over recent work evaluations, and
asking them for their input and their view for how they can bring in clients in the future.
And some law firms actually require their associate candidates to develop a client business
plan.
So, come up with a list of potential clients they think they could reach out to, potential
relationships that might develop into client relationships, and just generally how they
plan on generating revenue for the firm down the road.
And then who's ever making the decision, the board of directors or all of the equity partners,
will vote.
And generally it's a majority vote.
Either yes, this person becomes partner, or no, this person does not become partner.
And as you can tell from the nature of the discussions and evaluations and interviews
and voting that it is really important to have multiple equity partners that know you,
that have worked with you, that can be advocate advocates for you during this process because
you want people who are recommending you, who are pulling for you, who are promoting
you in this partnership evaluation process.
And what you don't want to have have have happen is your name show up on a list and
everybody blanks because no one knows who you are, no one's ever worked with you, and
no one is there to be an advocate for you in that process.
So what can you do to position yourself to make partner eight years down the road if
that is your ultimate goal?
Well, the number one question that law firms are going to be asking themselves when deciding
whether to make you partner, is does this person have an ability or potential to bring
in clients down the road?
And so for smaller law firms where the client base can be individuals or smaller companies,
smaller organizations, they may already require you to have a book of business in order to
make partner, meaning you already personally have that client relationship or that client
origination credit.
But, for most law firms, especially bigger law firms, it is very, very unlikely that
a senior associate has his or her own book of business already.
And so that's why they're going to ask you for a client development plan, for your strategy
as to how you are going to reach out to certain clients, how you are going to eventually create
and develop those relationships to bring in clients down the road.
And aside from actually having those clients already, or having a plan to develop those
clients, there are things that you can do throughout your eight years at a law firm
to prove to the law firm that you have that ability to generate client business, that
you are partnership material.
And the first one is do you do the substantive legal work well?
So, do you get a lot of great evaluations from the partners you work with, from the
clients you work with?
Do the cases and deals that you're working on do well or tend to do well?
Are they generating a lot of revenue for the law firm?
Number two, aside from the substantive legal work, are you a good manager?
Have you shown that you can run cases, that you can run deals, that you can manage other
associates and legal staff?
Number three is, are you good with people?
Do the partners who work with you, do they like you?
Do the clients that work with you, do they like you?
Do you have an ability to create relationships in the local legal community that could one
day turn into client relationships?
And finally, do you contribute to the law firm in ways other than just the legal work
itself?
Are you involved in the law firm committees?
Do you get involved in summer associate or recruiting activities?
Do you attend from events?
Basically, are you interested in the growth of the firm as a whole?
Now it's important to keep in mind that there are going to be factors outside of your control
that very well may influence whether or not you make partner.
And the first one is that if in your practice group or your office of the law firm or the
law firm as a whole, if the associate class is particularly bottom heavy or the partnership
group is particularly top heavy, the law firm may not be looking to add to partnership ranks.
The second one is that if in your practice group or in your office or in the law firm
generally as a whole is having a tight year, is having a low year financially, they also
may not be looking to make a new people partner.
Number three is the economy nationwide or worldwide depending on where your law firm
operates.
It definitely impacts different practice groups differently, and so it may be a really strong
year for real estate, but a really weak year for bankruptcy, and how that growth and that
health of those practice groups are doing and depending on what practice group you are
in, can absolutely impact and influence where the law firm is looking to make associates
partner.
Number four is just the overall general trend that less associates are being made partners.
And so in the traditional traditional traditional sense in law firms, it was a much more natural
transition from associate to partner, was much more of a given that that would happen.
And nowadays that's not the case at all.
As we've talked about, only 30 to 50% of associates are seeing themselves be made partner.
And one of the statistics that really jumped out at me was that in the last 15 years, 27%
of equity partners, a growth of 27% of equity partners has been seen.
But a growth of 86% of all other attorneys, non-equity partners has been seen in law firms.
And so as you can see, that is a really large disparity that is being, um, uh, experienced
in law firms right now.
And then the last factor I do want you guys to be aware of is the possibility that a particular
partner just does not want to see you promoted.
And if you are in a law firm where an equity partner has a veto vote that can block you
from becoming partner.
And I hate to say it, but I bring it up because I have seen it happen, that no matter how,
how hard you work, and no matter if you do all the right things, that you might just
get on the bad side of somebody, and that might prevent you from making partner at that
law firm.
But that's one of those things that you can't control.
So absolutely don't worry about it.
Just focus on making yourself the most competitive partnership candidate that you can make yourself
if that is your end goal.
All right guys, if you've stuck with me this far, congratulations.
And I want to hear from you in the comment section below if making partner sounds good
to you.
If it's something you think you would want to do, thumbs up, or if it sounds terrible
and you would literally do like to do anything else with your life.
Thumbs down.
And I want to hear from you guys and also want to hear how your opinion changes after
we go into this last phase of the video, talking about equity partnership.
So equity partnership, it is the crown jewel of law firm advancement.
It's a seat at the table.
It's a co-ownership in the law firm itself.
It's the most advanced that you can get in the law firm world.
And so as you can imagine, it is a goal of a lot of associates when they start out.
And the main difference with equity partnership, as opposed to any other role in the firm,
is that co-ownership, which means the compensation that you're going to receive.
So, instead of receiving a salary and a bonus like you did as an associate or like you did
as a non-equity partner, you're actually going to be compensated with a percentage of the
profits that the law firm earned that year.
And every law firm divvies up those profits a little bit differently.
But it generally operates on a point system, and the points are allocated to each partner
based on the contributions of that partner to the firm for that year.
And of course the most important contribution that a equity partner can make to a firm is
the amount of business that they bring in that year.
So, how much money did the clients that they have a relationship with, that they have origination
credits with, bring into the firm by way of hiring the law firm to represent them in a
particular case or deal.
As an equity partner, there are other ways other than client business contributions that
you can use to earn partnership points, partnership credits, such as contributing substantively
to a legal matter, a case or a deal that has a particularly positive outcome for the firm
that year.
And then to a lesser extent also sort of contributions in the running of the law firm itself.
So maybe management activities or your participation in law firm working groups or recruiting efforts,
things like that.
So as you can imagine, the income that you generate each year is going to fluctuate not
only based on your own contributions to the firm that year, but also how the firm does
overall.
Another important thing to keep in mind is that the size of the law firm really does
matter and how much money that that law firm generates is going to matter because you could
potentially make more as an associate or a non-equity partner at a big law firm, then
you might be able to make as an equity partner in a smaller law firm.
So those are just things to keep in mind as you go through your career and as you start
making those strategic and financial decisions.
And to give you an idea of how high this equity partnership compensation can go, the AmLaw
100 actually reports the profits per partner of the top revenue-generating law firms in
the United States.
And in 2018, the latest year available, that average was $1.7 million per equity partner
and Wachtell Lipton topped the list with paying their equity partners $6.5 million per partner.
So that gives you an idea of how high that number can reach on average for the top 100
law firms in the United States.
And last but not least, what happens if you don't make partner?
Traditionally law firms have had an up-or-out policy, meaning you either make partner or
you're asked to leave.
And this can be pretty brutal because most law firms are not very transparent with their
associates about their status as a partnership candidate.
And it could be that you invest eight years of your life into a law firm and only find
out that you're not partnership material when you get that no vote from the equity partners.
And so it's really important in your six and seventh and eighth years to have those difficult
conversations and ask, Hey, am I on the right track?
Is there anything I could do better?
How am I looking as a candidate?
So that you know and you have that information so that you can make decisions about your
career at that point.
And after all of this, if you don't make partner at the end of this entire process, don't ring
the alarm bells yet because you still have options.
And the first option is that you can try again.
So just because you don't make partner the first year that you're eligible doesn't mean
that you will never make partner.
A lot of law firms allow their associates to try two, three, four, five times to be
eligible for a partnership candidacy, and so if you get a no vote that first year, again,
make sure you're having those hard conversations about why it was a no vote.
What are you looking to see?
What can I do better?
What do I need to make myself competitive as a partnership candidate?
Number two is that you can ask the law firm if they have non-partnership track roles because
not all law firms have a strict up or out policy.
They also can have sort of senior, more senior than associate positions that are usually
called "of counsel" or "staff attorney."
And what that means is that you are more senior than an associate, but you're not as senior
as a partner, and you don't have any expectation and you don't have any desire to create client
business.
And so you can stay on at the firm and do the substantive legal work without worrying
about developing a client base.
A third option is to lateral.
So if you are an associate at a larger firm and you get turned down for partnership, you
absolutely can look to lateral to a smaller law firm and negotiate a partnership status
there because maybe you're experience and contribution wasn't deemed sufficient for
one law firm, but it absolutely could be for a smaller law firm.
Number four is to do something different with your law degree.
So at the end of all of this, it may feel like, you know, you slaved away for eight
years and it was all for nothing.
But you have to remember that you developed some incredibly marketable skills along the
way.
And this may be your chance to do something different with your law degree outside of
the private law firm world.
It could be that you become a business owner and you create your own law firm.
It could be that you take your law degree into the business world, into the corporate
world, as an in-house attorney, or you could go and fight for a cause that is really personal
to you in a nonprofit organization.
So there are lots of ways you can use that law degree outside of an associate or partnership
position at a law firm.
Number five is going the public service route.
So getting a job in a government agency.
And you could do this simply because you're interested in a government position, or if
your ultimate goal is still to become a partner, there are avenues into higher level government
positions, federal prosecution positions, and political positions, that lead back to
partnerships in law firms.
So keep that mind.
And the last thing I would say is that you have the option of leaving the legal industry
all together.
So if you get a no from a partnership candidacy at a law firm, it may be the best thing that
ever happened to you.
If you have goals and dreams that you haven't considered for years and years, and they include
opening up a bakery in Costa Rica, then this is your chance and your opportunity to really
make those goals and those dreams a reality.
So now you guys know everything there is to possibly know about making partner in a law
firm, but in order to be eligible to even go down that path, you first have to get a
job at a law firm.
So be sure to check out my free quick start guide on getting that first legal job out
of law school.
It has my top five strategies on what you can do and what you can focus on in law school
to put yourself in the best possible position.
And if you haven't subscribed yet, be sure to subscribe over here and check out these
two amazing videos over here.
I hope this video was helpful, you guys.
I'll see you the next one.
Have a good week.