Would you consider your law firm to be profitbale? If not, do you know how it can be?
In this episode, Casey talks to Joesph Hoelscher of Hoelscher Gebbia Ceppedia, PLLC about the five keys to a profitable law firm.
Hoelscher is an award-winning criminal and family law trial lawyer whose tireless dedication to his clients had earned him national recognition. He has successfully represented clients in high-profile civil and criminal cases covered by outlets such as Crime Watch Daily with Chris Hansen, The New York Daily News, Washington Times and America’s Most Wanted. Joe is a published author and regular speaker at public events and legal seminars. He advocates a client-centered approach to legal representation and aggressive trial-oriented approach to the law.
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Interview Transcript
Casey Meraz:
Welcome to another episode of the Legal Mastermind podcast where we have tactical conversations with leading legal and marketing experts. I’m so excited to have Joe Hoelscher from Hoelscher, Gebbia Cepeda, here today to talk to us about the five keys to a profitable law firm. Joe, thanks so much for joining us today.
Joe Hoelscher:
Thank you for having me. I’m happy to share what’s been successful for us, and I hope it helps people.
Casey Meraz:
Love that. Yeah, in this time, or just really any time, I think a lot of people that have started a law firm or any business, for that matter, they’ve had wild dreams of success and profitability. But the reality is for most that they don’t ever get to that level even. And maybe they get caught up working in the business, but whatever the reason, that’s why I’m excited to talk to you on this topic today, because I feel like you can really help a lot of law firm owners.
Joe Hoelscher:
Yeah. In law school, there’s this dream, that you’re going to come out, you’re going to be well compensated, you’re going to be kind of important, you’re going to make a difference. And it’s kind of bogus because most of us leave law school with a bunch of debt and prospects that don’t allow us to cover it. We’ve been very fortunate at Hoelscher Gebbia Cepeda that we have been successful, but we tried a lot of things that didn’t work first.
Joe Hoelscher:
I think five keys is a good way of looking at it. Every lawyer wants to be a lawyer, and that needs to come first. And that means putting the client first, and that’s the first key. Client always comes first.
Casey Meraz:
Well, I’m glad that you said that because I feel like in this day and age, there’s online reviews and word of mouth spreads fast and people that are upset can complain easily. Whatever it is, it seems like you have to really focus to customer service now and you always should have. But if you didn’t and you got away with it before, maybe you can’t anymore.
Joe Hoelscher:
Well, yeah. I think it is harder. The number one reason in Texas that lawyers get in trouble, state bar tells us every year, is bad communication with clients. It’s what starts the situation that gets lawyers disbarred or disciplined. And it can itself be a reason to get disciplined. And as long as you’re focused on that good communication, any complaints that come forward ought to be brought to you first and give you that shot before it’s permanent on the internet. Now, the bad reviews that we’ve got right now are largely from people who aren’t our clients and who are mad at us for beating them in court.
Joe Hoelscher:
But there’s this one lingering review out there that every time I see it, it bothers me because I feel like I did a good job for that guy. But I know he doesn’t feel that way. It is a struggle to make sure that you are communicating with your clients. Even when you screw up or even when you get a bad result, you’re not putting them off, even if you feel like that client might be a little irritating or difficult to deal with.
Casey Meraz:
Sure. Yeah, and that’s hard, I think sometimes for some people because I think you know as well as I, people are tougher online. I don’t know. If you’ve had to deal with a client that’s upset, is that normally coming through phone or one of those fiery emails? How has it been for you?
Joe Hoelscher:
Well, a lot of times, they are going to flame me by email. That’s the 11:00 AM or 11:00 PM, midnight email and you wake up in the morning and it kind of ruins your day. Sometimes, it’s angry text messages. Sometimes, it’s my staff coming to me and going like, “So-and-so’s pissed. What happened?” I’m like, “I don’t know. I thought everything was cool. Let’s go talk to them.” Sometimes, we do hear something online afterwards, and those are the most disappointing because they kind of come out of the blue and you don’t have a chance to fix it. But we’ve been pretty fortunate. When we get bad reviews, we reach out to people and we say, “Hey man, why are you taking this to the internet instead of bringing it to us?” And usually clients will say, “Oh, I was upset something happened.” And then we can kind of fix it.
Joe Hoelscher:
The communication is key. But because we communicate well, we have a relationship with our clients. If you’ve ignored somebody and you don’t have that relationship, that tactic isn’t going to work.
Casey Meraz:
Yeah, and from what I’ve seen is if you give people an outlet, like let’s say you’re just even talking to them, having that great communication like you’re talking about, they probably are more likely to tell you because they have an outlet, whether that’s in email form or a phone call or whatever. But when you close yourself off and you’re not answering your phone and you’re not communicating, that’s I think, where I’ve seen a lot of situations explode. I don’t know about you.
Joe Hoelscher:
Absolutely. Another key element for us is we … This is going to be my second key, is keep the drama in the courtroom. We don’t need drama in our office. We don’t need drama in our client relationships. When we go to court, that’s when we’re going to fight and that’s when people maybe get yelly a little bit. But you have to have that good communication to do that, and you have to be sensitive to your clients and develop the relationship over time. I’ve had clients come back to me and say, “Man, I didn’t realize how good you guys were until I went with somebody else.”
Joe Hoelscher:
And the key, the real key is managing expectations, too. You have to be able to tell your client, “Look, this is why things are happening. This is why you’re not going to hear from me for a while. I don’t have answers. And when you call me, I’m going to bill you. If you want me to call you every week, I will. But you’re running out of your retainer and you’re going to have to re-up.” If it’s on a criminal case where we’re charging a flat rate, we got to tell people. We’re going to have new cases coming in. We’re going to be waiting in line for your trial for a year. Don’t expect to hear from us all the time because once we get past discovery and whatever step is critical, we’re just waiting.
Joe Hoelscher:
We say keep the drama in the courtroom and what we mean by that is quickly address people’s concerns and tell them what to expect and try to manage expectations ahead of time instead of after there’s a problem. Then, they don’t trust you anymore. there’s a breach in your relationship.
Casey Meraz:
Yeah. No, and I think that’s great advice. I think a lot of attorneys that struggle don’t set those proper expectations. I have a friend who hired an attorney recently and he’s kind of in that boat that you were just explaining where he’s like, “Well, I haven’t heard from the attorney. It’s been a week.” And this is part of a mass tort deal, too, so it’s going to be some time there. But that’s because that expectation probably wasn’t set up front, is my guess.
Joe Hoelscher:
Yeah, yeah. We all advertise we’re going to have great customer service. We’re going to be communicative, so the client comes in and goes, “This is the guy who will talk to me and return my phone calls and I can text at 2:00 AM.” You got to slow people down on that. We give them homework, is another way to do it.
Casey Meraz:
Oh, that’s good.
Joe Hoelscher:
Say, “Hey, go get me a witness list. Go build a timeline of your case. We’re going to do discovery. Why don’t you suggest some questions we can ask?” And that kind of helps them, too. But in an age where we have smartphones and Zoom, and there’s almost an expectation built socially that we’re going to be accessible 24/7, which isn’t realistic with this type of work. You have to build in expectations and let people know you might not get a call back the same day. It might be the next day. If it’s an emergency, here’s how … Let us know. Here’s who you talk to.
Joe Hoelscher:
But that’s been hugely successful for us because when people are upset it’s because something they expected didn’t happen. If you get their expectations reasonable, you’re way less likely to piss them off for some reason.
Casey Meraz:
Definitely. No, that’s great advice. And talking on the other side of your point one and point two, is if you’re setting these expectations and you’re communicating with the client and you’re doing that, that’s the first step in building a practice that’s going to get a lot of referrals, I imagine, too, because people are going to be happy.
Joe Hoelscher:
Oh, it does, absolutely. Especially if people have tried other lawyers, because whatever the sales pitch is that brings people in, it tends to be the best of who we are. And at some point, you got to impress on them that you’re human and not a miracle worker, but it also requires a high degree of organization. And that’s the third key, I think. And these are in no particular order, okay?
Casey Meraz:
Sure. Yeah, no worries.
Joe Hoelscher:
It’s just massively important. And they don’t teach it necessarily, in law school. They don’t teach you how to organize your business. You have to set up. We use a CLIO, which is a case management software. We have a marketing firm that has access to some of our systems with client information. You have Google Drive and Dropbox and we have to integrate all of these things and keep track of them. And that helps. We have a bookkeeper because we’re lawyers and we’re bad at math. We got a bookkeeper. And it’s the organization that helps.
Joe Hoelscher:
You didn’t hear from me. One of my partners can look in the system and go, “Look, I know you want an answer quickly. You put that in the email. I can’t tell you exactly what’s in Joe’s mind, but here’s the last note in the file. And I do see that we have the documents that you received, and I also see that we’re in the middle of drafting or have filed X document.” Most of the time they’re like, “Oh, okay. That’s what I wanted to know is are we filed yet. Thank you so much.” And the organization helps us also to understand the expectations we need to set. If you’re disorganized, you get caught off guard. And just reducing the chaos … Again, but a lot of law firms don’t, man. Lawyers tend to fly by the seat of their pants sometimes, especially solos and small firms like us.
Casey Meraz:
Yeah. No, and that’s good that you’re using CLIO. It sounds like you’re well organized so that you can focus on the things that are important for you. I’ve talked and worked with law firms in the past that maybe do their case management from Excel, and they’re probably having some issues right now if they’re not in the office, things like that.
Joe Hoelscher:
And some guys are on Salesforce now. They’re using Salesforce to track their stuff. I’m like, “Man, you’re way ahead of us.” But no, you’ve got to have some system, and using the out-of-the-box stuff that comes with your Microsoft Suite is not a good idea. It’s just not a good idea.
Casey Meraz:
Well, we can agree on that.
Joe Hoelscher:
We tried Google. Yeah. We tried Google Suite, too, for a while and it’s … No, you need customized software and you really have to put thought into how to organize yourself, too.
Casey Meraz:
Yeah. Would you say when you’re working with, whether it’s CLIO or any other case management, it’s probably helpful that it ties in with marketing as well, but you really … I think you touched on something there that I just wanted to cover a little bit deeper. Setting it up the right way first, is that how you did that? Or did you piece it together over time?
Joe Hoelscher:
I pieced together a lot of things over time that didn’t work out right, because I was a solo for a long time and then I had associates. And when we formed this firm and everybody bought in, the other two guys were coming from other firms. One of them was inheriting his firm and had never run it. And I said, “Okay. This time, we’re starting from scratch and we’re going to set it all up right from the beginning.” And that required us to watch videos, talk to people, get trained, have trainers come in. Because if you screw it up initially and then you’ve got to go back and fix it, man, Casey, you’re right, it’s so bad.
Joe Hoelscher:
And then all these new cases and problems coming in, so it’s always a lower priority when you’ve got somebody who’s about to lose their kids or somebody who’s getting arrested. Like, “Hey, I really need to sit down and figure out how to use my case management software today. I don’t know.” Yeah, they don’t want that.
Casey Meraz:
That’s not what they want to hear.
Joe Hoelscher:
This time, we did it right and it’s been night and day for us. Our criminal guys still doesn’t like to record his time very well. The secretary actually does that. But we’re there where we know where all of our information is. We have one interface to use to look at it, from billing to marketing to actual information management. And it’s expensive and it’s totally worth it. It’s worth every penny. Don’t tell CLIO or any of the other guys. We’d pay more if we had to.
Casey Meraz:
Yeah, we won’t let them hear that. No, that’s awesome. And organization really seems to be at the heart of successful firms. And again, I have plenty of examples seeing the other side of it as well where people are just piecing stuff together. And even though it might cost more to do it right and maybe upfront, the actual opportunity cost from what’s lost kind of putting that together seems to be large.
Joe Hoelscher:
It is. And so many things are streamlined. To give you one example, our taxes, we can print out the CLIO report, send it to our freaking accountant and give him access to our bank records. And he gets our taxes done much faster. It costs less money than the first time when we basically delivered him kind of a shoe box full of crap and he had to figure it out. Then he can get my personal taxes done cheaper and faster because my business taxes are in order and I’m not missing any deadlines. When we came to this whole mess with the PPP and applying for [inaudible 00:18:07] and pay loans, we were applying day one on everything and our paperwork was right. We were blessed to get our money, but that was because of the organization. It really does save your ass.
Casey Meraz:
That’s another testament to doing things right, because there’s still tons of businesses that, well, maybe not even have their information together to apply for it. But that money, the first round went away really fast and the second, it’s going to be gone here soon. I can definitely understand that. What’s the next key, do you think, for a successful law firm?
Joe Hoelscher:
I think you have to know who you can rely on and build a good team. Mental load is a real thing.
Casey Meraz:
Okay.
Joe Hoelscher:
There’s a certain amount of crap you can carry in your head at one time, like RAM in a computer. And just like if you overload your RAM, you’re going to have issues, things are going to lock up, freeze up your, your computer might crash, it’s the same with us as human beings. There’s a certain amount we can keep track of and in brains at once. And so you have to have other people that you can shove stuff off onto. It may be bringing you the cup of coffee in the morning or right after lunch so you don’t get that 1:30 feeling. It may be somebody who knows how to talk to people on the phone, somebody who does the deposits reliably. Whatever you can shove off on the third parties that isn’t lawyer work, you need to find a good person to do that. And that means finding good vendors.
Joe Hoelscher:
It’s been one of the toughest things for us because there’s so many people who will market to lawyers, take our money and not do what we need them to do. What we need is for them to be fire and forget. But that’s a big deal. That’s why I’m not afraid to say CLIO, because those guys have been good to us. When we call in and we have help, they answer us. I would recommend my accountant because he’s the same way, but he’s only in San Antonio.
Joe Hoelscher:
We bank with a local bank because they return my phone calls. When I ask them, “What do I need to submit for the PPP?” I was getting emails, phone calls, and they were helping us. You got to find what in San Antonio we call buena gente, just good people. People who maybe aren’t the smartest, fastest, best, but they’re reliable so that you know what you’re getting from them every time you ask them to do something. And that just kind of de-stresses you and lets you focus on what needs to be handled as a lawyer, and a good team, and realize you can’t do it alone.
Casey Meraz:
That’s really awesome advice. And I think it’s my opinion that people are the hardest part of any organization, but when you find the right people, that’s when you’re going to grow. That’s when you’re going to Excel for all the reasons that you’re talking about, and not just your internal team members. Like you were saying, your bank, they actually helped you with PPP, whereas Wells Fargo just emailed me yesterday and that was, oh, I don’t know, a month in.
Joe Hoelscher:
I heard they had some problems.
Casey Meraz:
Yeah, definitely. They had some major problems and they still are and they’ll probably continue to, but enough of that rant there. Have you ever hired anybody that didn’t work out and if you had that situation, how’d you fix that?
Joe Hoelscher:
It happens. Of course, it happens. The way I address it, and of course, my partners have made me managing attorney because they know that I have a particular way of addressing things. I try to nip things in the bud. As soon as I get a bad vibe off of somebody or they’re not getting things done, we take immediate corrective action the first time, of course, to try to explain how to correct things and give them an opportunity to fix it and do it correctly. After that, it’s a warning. And then I typically fire people, because I don’t have time for that.
Casey Meraz:
Yeah, no.
Joe Hoelscher:
Somebody else will get a better shot at it and not have something messed up by one of my clients. I’m at a meeting, but I made a commitment to you, so I’m here, but my partners are in another room. Well, different rooms, Zooming, and I know they’re talking about whether or not we’re going to terminate somebody today. I know what my vote is on that because I like to take care of things quickly. Sometimes people recover, but my general experience is if you get into trouble quickly with a new hire, just move on. If you’ve worked with someone, you’ve got a relationship and they really screw things up, you can work with them. But if they’re not coming to you to tell you they screwed it up, that’s a bad sign.
Casey Meraz:
Yeah, it’s like ripping off that bandaid. And I think toxic employees can ruin a whole culture.
Joe Hoelscher:
Oh, yeah. We had an all star paralegal in here and we’ve got an all star office manager, top-notch talent. Not them specifically, but someone with their close relatives ended up dating the same guy and ultimately, one of them had to go.
Casey Meraz:
Wow, okay.
Joe Hoelscher:
The personal stuff is there and it’s real and you can’t pretend it doesn’t exist. You have to have a good team. But part of having a good team is good communication. All of these steps, all of these five keys to a successful firm work together. You got to be communicating with your people, too, and understand where their discomfort is and can it be fixed or not. Not everything is them screwing up on the jobs. Sometimes, it’s just environment.
Casey Meraz:
Yeah. No, definitely. And I don’t know if you’ve ever had this situation, but it just reminded me of something I read in Good to Great, having the right employee in the right seat on the bus … In some cases, we’ve had to move people. I don’t know if you ever had to do that, too, but certain people thrive, I guess, in other environments or maybe even different organizations. If they’re not working out for you, it’s not necessarily that they’re bad. They’re just not good for your organization and there might be somewhere else that’s better for them. And you need to do what you need to do, because your obligation is to the business and your other employees. And if you have somebody that’s bringing the culture down or hurting it and you’re not taking action, then I can see how that would have a long term detrimental effect on morale, profitability.
Joe Hoelscher:
Yeah, of course. Because the team that is on board and that is working together, when they see somebody who’s not part of that effort, it hurts morale, like “Why am I staying up late? Why am I answering his texts at 10 o’clock at night wanting to know where the documents are that he wants in the morning?” We expect a lot from our people. And so if somebody is not pulling their weight, it’s kind of a slap in the face to those guys who are. It’s a respect issue, too. It’s better to be upfront. It’s better to tell people where you stand, and then they know. And you got to be consistent. You got to keep your word. But if you’re not being deceptive, if you’re organized and know what’s actually happening, it’s a lot easier. Again, all this keys work together.
Casey Meraz:
Definitely. Well, good advice. And was that point number four? I lost track here.
Joe Hoelscher:
That was four.
Casey Meraz:
Okay.
Joe Hoelscher:
That was four.
Casey Meraz:
What’s five?
Joe Hoelscher:
Self-promote.
Casey Meraz:
Okay. Talk more about that.
Joe Hoelscher:
Look, man, marketing’s everything if you want new customers. Law is an adversarial field. We fight with each other. We’re not losers here. If you’re a winner, you need to tell people, because the consumer is not an attorney and they don’t know how to evaluate. Fine, we take some big losses on criminal cases, but if you’ve ever had to cross examine a child who has been a sex assault victim sitting next to the guy who did it, those are low win situations. Jury stays out a few hours, we might call that a win.
Joe Hoelscher:
On the other hand, where I’m going in to protect a child in court, if I don’t stop visits with somebody I think is dangerous and they still have contact with a child, even if it’s by video, I might consider that a loss. You need to go out there and explain to people who you are and your story and you can’t be ashamed of it. You can be humble about it. You don’t have to be a braggart, but you have to be up front. And I think that people do respect it, although we’re all taught not to talk about ourselves. Because when you come in and you talk real talk to people, it’s part of the communication, it’s part of the setting expectations, it’s part of [inaudible 00:26:23] because nobody knows where they stand with you. And nobody wants to hire a lawyer who that ain’t confident in himself.
Casey Meraz:
Yeah, absolutely. That’s a good point-
Joe Hoelscher:
And then to reach out. It’s why I’m talking to you, man. It’s why we go on TV and give media comment on social issues and get involved with social organizations and help raise money for charities, because we want that visibility. And if you are a good lawyer, you’re not doing anybody a disservice by promoting yourself.
Casey Meraz:
No.
Joe Hoelscher:
You’re the kind of lawyer they need.
Casey Meraz:
Well, and really, you’re helping people, especially if you’re a good lawyer, because you’re giving them the opportunity to hire you if they can find you and actually have success with their case. And I think that’s one of the problems that I have with online services where people are looking to hire a lawyer and they’re like, “Oh, let me look on Avvo” and “Oh, there’s a 10 score. They must be good.” And we know that that means nothing.
Joe Hoelscher:
Right. I was one of the first people to get aggressive about Avvo because it came out right when I started. And so I filled out my profile and I got a 10 pretty quick. But I knew there were much better lawyers who didn’t even know it existed and had crappy ratings. And I’m sitting over here with a 10 as a guy who’d only been practicing four years. It’s hard as … because we’re a sophisticated field and our consumers are almost necessarily unsophisticated. It’s the nature of being a professional. I don’t know what the plumber knows. I don’t know what the electrician knows. All I know is that my stuff works afterwards. And I think you got to make sure you’re telling your clients, “Look, we did okay today. I know you’re not happy. But here’s the advantage of what we did today.”
Joe Hoelscher:
And I didn’t want to go out to the public and say, “I am a good lawyer. I got my client out of jail. You’re upset that this guy got off today because you think justice wasn’t done. I was his lawyer, and I’m proud to stand next to this innocent man.” You got to sell because it’s not just you. Your reputation is carrying you in court. It’s carrying your firm and it’s carrying your clients. You just can’t be, as I said, arrogant about it.
Casey Meraz:
No, that’s great. And I appreciate that. And I can relate to that as well. And I think you’re on point there. And again, there’s so many … I don’t want to say there’s so many, but there are a lot of crummy lawyers out there and you can see that by reading their reviews online from a consumer, say, but people still hire these clowns, so you’re onto something there.
Joe Hoelscher:
And they do brag. The problem is a lot of good lawyers … This is a fact with somebody who is skilled. They know more about their shortcomings than a person who is unskilled. We see that and we think to ourselves, “Man, I blew that case the other day. I screwed up that argument.” And we tend to see ourselves as not as successful. You have to take that moment and look around. A lot of the people who are not with me anymore that have worked for me in the past, that was our disconnect, is that they couldn’t go out there and have the courage to say, “I did a good job-
Casey Meraz:
Okay.
Joe Hoelscher:
… here, too.”
Casey Meraz:
Wow. Well, awesome. Well, Joe, this has been a really great conversation. I really appreciate your expertise and insights. And it sounds like you have a very successful firm. And I’ve agreed with everything that you’ve said so far. Is there any parting advice that you have for anybody watching this that we didn’t cover that you’d want to get across?
Joe Hoelscher:
Being a lawyer, it’s a hard gig, man, but it is a brotherhood, a sisterhood. There’s never enough good lawyers. If you’re dedicated and these five keys are something that you understand will take work, but you’re willing to do that work, there’s a lot of us in the same boat and we all want to appreciate each other’s success, so good luck.
Casey Meraz:
Awesome. Well, Joe, again, thank you so much for taking the time to join us today. I’ll let you get back to it, but I look forward to connecting in the future to see how things are going for you.
Joe Hoelscher:
I’d love that. Take care, Casey, and thank you very much for having us on today. I appreciate it.
Casey Meraz:
Sounds good. Take care. Thanks. Bye now.
