Equity partners in traditional law firms share their firm’s profits in accordance with a variety of fee-sharing models.
The model can disadvantage lawyers who feel they are putting in more than their fair share of billable hours and particularly those who bring in more than their fair share of clients and instructions.
On the other side of the coin, tensions arise, particularly in lock-step arrangements, where certain partners are perceived as failing to “pull their weight” or are simply seeking to operate at a slightly lower frequency, which may be for a whole host of reasons.
In short, the traditional law firm does not cater very well to different speeds.
Further, we face the widely documented but poorly understood digital revolution across our sector. How well placed are traditional firms to cope with a low headcount, small footprint, tech-investment future?
At Clearlake, we have devised a new and unique model of partnership. We offer partners all the support and infrastructure of a traditional law firm whilst allowing them to operate fully independently from a financial perspective, all from within our limited liability partnership.
We firmly believe that as the legal industry develops and as technology plays an ever-increasing role in practice, senior lawyers, particularly those able to develop and maintain client relationships, are uniquely well placed to benefit, but that the traditional law firm is not particularly well placed to make the most of the industry shifts to come given its enormous (and increasingly unnecessary) overhead structure.
At its simplest, Clearlake’s partnership model allows our partners to share low, fixed costs but keep their own profits.
There is a small charge for providing our law firm-as-a-service and for managing the firm day to day. After central costs and fees are deducted, each partner retains at least 80% of their total billable fees, although this figure is typically around 85% (a significant improvement on the 60% – 75% fee retention available with the legal consultancy platforms).
As well as retaining a greater share of their own profits, partners at Clearlake are able to earn in excess of their own billable hours when they refer client work internally, scale their own teams or play a role in developing and distributing our client-facing legal technology offerings.
Our partnership is also deliberately designed to encourage collaboration without conflict.
We are a partnership, first and foremost, and we firmly believe that we are stronger and more prosperous together, but by taking out any politics relating to remuneration, yet retaining the joint sense of purpose in building the next generation of law firm together, we believe we have a model fit for the next iteration of legal practice.
To learn more about how you could benefit from a more advantageous fee structure and our culture of shared independence, take a look around our careers website or read our FAQs.