Automation & EfficiencyPodcast

Surprising Takeaways from Clio’s Legal Trends Report

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Episode Description 

We’re diving into the 2023 Clio Legal Trends Report! Looking at the latest data on billable rates, utilization rates, and more, we uncover opportunities for growth and improvement in law firms today. 

Key takeaways:

  • Lawyers are working harder for less – billable hours are up 25% but revenue is stagnant at an average of only 2 hours a day 
  • There’s a disconnect between what lawyers think about billing and payments versus what clients are saying  
  • The data doesn’t lie: the traditional law firm model focused on billable hours isn’t working anymore for lawyers or clients

See why the data shows that lawyers need to move away from antiquated approaches and find new ways to structure and run their firms. A huge opportunity exists for those willing to make a change. 

If you feel stuck on the billable hour treadmill and are ready for a new model, join us in our new Law Firm Growth Mastermind in 2024. Learn exactly how to earn more while working less. Seats are limited – sign up today at

Episode Resources

Law Firm Growth Mastermind

2023 Clio Legal Trends Report

Episode Transcript

LAUREN: [00:00:00] So for every eight hour day that an attorney is working under this traditional model, they are only generating revenue for 2. 2 hours.

Welcome to a different practice. We’re your host, Lauren Lester and Jess Bednarz, and we’re obsessed with all things business well being and optimizing the practice of law for solo.

Lauren started her solo practice right out of law school, built it from the ground up, and now works four days a week while earning well over six figures. Jess approaches the profession as a whole to identify opportunities for growth and help implement systemic improvements. We’re here to share tangible, concrete tools and resources for ditching the legal profession’s antiquated approach and building a law practice optimized for growth and enjoyment.

Think of this as grabbing coffee with your work besties mixed with all the stuff they didn’t teach you in law school about how to run a business. Pull up a seat, grab a cup, and get ready to be encouraged and challenged. This is a different practice. [00:01:00]

Hi friends. Welcome to another episode of A Different Practice.

We’ve had a few episodes here recently where we’ve been talking about data, and we’ve focused more on the data of your actual law firm and how you can use that to make more intelligent decisions. But today we’re going to focus on a different kind of data. And we’re going to look at the 2023 legal trends report that is published by Clio.

And Jess and I will talk about kind of our takeaways from this report in this latest year of data, what surprised us, what was a lot of the same and more importantly, how this data shows us. That there are opportunities to still be had in the legal profession to create a thriving practice as long as you do not follow the traditional model.

And I think we’ll hopefully share today how some of the data that we’re seeing in this report is showing how the traditional model just isn’t [00:02:00] working. Lawyers are still trying to make it work. They’re still on that treadmill, but it’s not, it’s not. Getting any better. So just to give you a brief history, if you’re like, who the heck is Clio?

Clio started in 2008 and they were probably one of the first companies that offered a cloud based practice management system. So if you’ve heard of their name, but couldn’t place them, that is what they do. They are very well funded. They are one of the biggest players in the solo small firms. space.

And so in the market, a lot of attorneys think that they’re the only player when it comes to cloud based practice management systems, that there are a lot out there, but Clio just tends to be one of the biggest ones and one of the loudest ones. But because of that, one of the benefits. are that they have a lot of legal professionals who use them.

So they report that they have over 150, 000 legal professionals on their platform. And from those folks who are using it day in and day out to [00:03:00] manage their cases in their law firm, that’s where they get a lot of their data. So in this report that Clio released recently, they have three data points.

One is going to be all of the data from their software. This is anonymous data from their users, from their clients and their billing rates and how much time they’re spending on different cases. And so they take all of that and strip out the personal information and use that to create an aggregate report.

I think it’s important to note that Clio’s report is Built, and their software is built on a billable hour model, which if you’ve listened to our podcast at all, you know, is not our favorite. We think that value based pricing and other models are much better for the consumer. And I even personally, I use Clio is my practice management software, but I don’t bill by the hour.

So I do have to kind of finagle their system. And I would be curious to know if let’s say my data is in the. Data set [00:04:00] that goes into this report that may be skewing their data. So that’s all to say that the data while it’s there, and it does come from a good amount of legal professionals, I wouldn’t take it as absolute fact and definitely take it with a grain of salt in their report.

Clio also includes survey of legal professionals. So not only the data from the case management software, but also just asking legal professionals, a survey, which they did. Between May and July of this year. And they ended up talking to about just under 1, 500 people. I mean, this is lawyers and the support staff, just kind of anyone in the profession who is serving clients.

And then they also did a survey of the general population. So of clients, and these are both folks who have engaged with legal services and then also folks who might be potential legal consumers. So that data set, if you’re curious, is just over a thousand adults in the U S. And they looked at things like attitudes, opinions, preferences, and [00:05:00] behaviors as it was related to the legal profession.

Clio does note that the sample that they have is representative of the U. S. population by age, gender, religion, income, and race. So they’re understanding it as a good cross section. So that’s where the data is coming from. We’ll kind of go through. Our takeaways from it, but Clio has been putting out this report since 2016.

They release it every year. If you are curious to see the report for 2023 or the report for any other year in the past, you can get any of that at Clio. com. So in the report this year, Clio does look at things like average billable rate and utilization rate, which we’ll get to and kind of running a law firm, but they do have a new metric, which is interesting that they included this year, which is the lockup rate is what they call it.

And really, this talks about cash flow. And so they look at things, what they call the realization lock up rate. So this is how much of a firm’s revenue is unbilled. [00:06:00] So the work has been done, but it hasn’t been put on an invoice and actually sent out to a client yet. So you could kind of think of that possibly as the work in progress.

And then they also look at the collection lock up rate. And so this is revenue that has been billed. It’s been sent out to a client, but it hasn’t actually been paid yet. More traditionally or more commonly. You might refer to that as AR or accounts receivable, right? But the point that Clio is trying to make in the report is that cashflow is really important to businesses, certainly to law firms.

We are a business after all, and that it could potentially be one of the challenges that law firms are running into in terms of being able to actually run the business. According to Clio, and I think this is pretty common across the board in any kind of accounting theory is that you want to reduce that lock up rate or basically increased your cash flow.

They provide an example on page 30, which I thought was really. Stark. It was kind of shocking, something that [00:07:00] I didn’t actually realize how easy it would be to fall into this hole. But they talk about any law firm say they start with 5, 000. But if that law firm has an average deficit every month of even just 200 bucks, right?

That’s not a lot in the grand scheme of things. But if you run that deficit every single month, that law firm, no matter what their billable work is. Will be bankrupt in two years. So if you don’t believe that cashflow is important and understanding your numbers is important, that is a really easy example to see that it actually is.

And even a little tiny drip, right? 200 bucks a month. Doesn’t seem like a lot can ultimately. bankrupt your business. So I appreciate that Clio brought in an emphasis on cash flow. I think that lawyers don’t think about that enough in our businesses and it’s something that we do need to pay more attention to because it is a big metric on the health of our business.

If you remember back in [00:08:00] episode 21, we talked with Brooke Lively, and one of the core financial numbers that showed the health of the law firms that she worked with, the first thing that she said was cash flow. So this is something that’s really important to think about and look at, and I appreciate that Clio has it included in here.

They also included, for the first time, a consideration about AI. Obviously, that’s everywhere nowadays so it’s no surprise that they are including a section about it in the report. Overall, the consensus I found was that lawyers and clients know it’s out there. It’s still so new that it’s early to tell how reliable it’s going to be, how helpful it’s going to be.

I think both sides are a little bit wary of it and approaching it pretty cautiously. And it was interesting to see that a lot of lawyers are hoping to use it for things like document management, calendaring, legal research, but they just don’t think that the technology is there yet, or at least they just don’t have the confidence in it yet.

All right, so [00:09:00] my biggest takeaway from the report as a whole, if I had to say, Sum it down is that it appears to me in interpreting the data that lawyers are working more and earning less. Clio reports that the average hour of legal services is up by 22 percent in the last year, so it costs 22 percent more, and that’s Across the country, about 300 an hour.

It’s a little bit under that, but that’s the average hourly rate that they are seeing from the data set that they have polled. But they also found that lawyers on average have a heavier caseload and are putting in more billable hours. In fact, it’s 25 percent more, which is a pretty big increase. When you think about, we’re still talking about a 24 hour day, right?

Like the pie doesn’t get any bigger in terms of the amount of time we have. So lawyers are working more and recording 33 percent more billable hours [00:10:00] because they are working more, which might sound great. But when you go through what Clio calls their utilization and realization rates, it actually isn’t resulting in a lot more revenue, or at least an equal amount of revenue that you might think from those numbers.

So If you’ve ever read Clio’s Legal Trends Report, you know that they talk about the utilization rate, which is going to be the amount of billable time that actually occurs in an eight hour day. So there is a slight increase from last year in the utilization rate, which would make sense because if lawyers are billing 33 percent more.

That’s going to affect kind of what is actually put on the billable time. But what the data showed is that nearly two thirds of the workday, so two thirds of that eight hour day is still underutilized, is still not actually producing Billable work, if you want to work under the billable hour and Cleo notes in their report that they’re attributing this [00:11:00] to inefficient admin and business development tasks.

So their past research, it sounds like has said that this could be upwards of 48 percent of a lawyer’s non billable time is. Inefficient admin 48%. That means half of the time is spent doing admin tasks and not anything that actually generates revenue. I don’t know any other business that if you’re spending nearly half of your time on something that doesn’t generate revenue for the business that that’s going to be a long term successful game plan.

And Clio notes, which is also not surprising that firms that have strong revenue have used technology to help with those office admin tasks. So clearly there’s a correlation there that the less admin time you’re going to spend, the more you’re likely to create revenue. In this part of the report, which is around page 20 if you happen to be looking at it, Clio [00:12:00] also notes that law firms are struggling to find enough clients to keep their lawyers busy.

And I can’t say I’m super surprised by that. I don’t know how you feel, Jess, but with 300 an hour on average, which is a lot of money for the average consumer, lawyers are trying to bill more. So they’re trying to pump out more billable time. The consumers can’t pay that. And so now the lawyers are just on this treadmill trying to find more clients to bill more time to, and the market is shrinking.

JESS: Yeah. I mean, there’s plenty of research to show that there are plenty of legal consumers out there who have at least some money to pay for legal services. And they need legal services. And I think what that shows is the average lawyer is. Pricing them out of the market and, or they’re just, they’re not offering options.

They’re not offering different levels of service that could be affordable and accessible to the average legal [00:13:00] consumer.

LAUREN: Yeah. I mean, we, we don’t have a business without clients. So if that starts to become a bigger and bigger gap, if it is not addressed. Either as the profession as a whole, right, which is a whole access to justice discussion, but as us as business owners, like we’re leaving money on the table where we’re slowly closing our business because we just don’t have enough clients to generate the revenue that we need.

And unfortunately I think that’s just because that business model of the billable hour, which keeps going up and up and up is not working for the average legal consumer.

JESS: And that high hourly rate, when you pair it with the fact that. Most attorneys then don’t also pair that with, oh, it might take this number of hours or give some sort of estimate as to the total number of hours, the time frame, anything, even if a legal consumer has some money to pay, they’re less likely to join with that firm because they, they’re on a budget, [00:14:00] they need to know, like, can they afford everything, all of the service that they going to be left high and dry like two months in?

Lawyers typically can’t answer that question for them. And so, you know, If I were in their shoes, I would opt out as well.

LAUREN: And I think lawyers are trying to address that on their end by discounting or not billing on an invoice all of the time. So they sort of feel like, well, I’m cutting the client a break there by doing that.

And Clio reflects that in their report by what they call their realization rate. So that’s like how much of the billable work that’s done is actually invoiced to the client to be paid. They find that for the last year, it’s about 86%. So all the time in a day, eight hours, we’ve already at least cut that in half because we have so much fricking admin work that people are doing, but we really know that it’s only about a third of the time that’s spent doing billable revenue [00:15:00] generating work, then we’re cutting that down by almost what, 14 percent before sending it out to the client.

And then when the client gets the bill, which like you said, they have no idea what’s coming because they have no ballpark that’s given to them. Some months it could be a thousand dollars. The next month it could be 25, 000 bill. That’s going to impact the collection rates. And so when Cleo looked at the collection rates for the last year, it’s at 89%, which could generally sound somewhat high, but I would argue.

We’re losing money, right? That’s 11 percent that should be generating revenue that we’re leaving out on the table that clients aren’t paying. And the reason that they’re not paying could be a number of things. They could maybe not afford it. They could maybe not be happy with the quality of service.

They could maybe think that the. Outcome wasn’t what they were expect, whatever [00:16:00] the issue is. But I think a lot of that can be resolved by setting expectations about cost upfront with clients. And Clio goes ahead and sort of gives a nod to that without, I think, calling it outright to say that we’re, we’re not doing a great job as a profession of setting expectations. They say that, you know, those issues arise when attorneys don’t establish reasonable billing expectations with clients or when a case hasn’t been appropriately vetted during the intake process, which we preach about all the time is it starts in the beginning with setting expectations.

So if we do the math. Just because we’re throwing out like percentages here and we take all of these rates as it comes to kind of revenue. If we look at an 8 hour day, based on the numbers that Cleo’s reporting, that is an average for law firms across the country [00:17:00] at an 8 hour day. There are 2. 9 hours that account for billable work. So that means all the rest of the time that’s spent by the attorney is not actually generating revenue. And then of those 2. 9 hours, only 2. 5 actually get invoiced because the attorney is discounting it for one reason or another. And then of the 2. 5 that gets invoiced, clients on average are only paying 2. 2 hours A day.

So for every eight hour day that an attorney is working under this traditional model, they are only generating revenue for 2. 2 hours. And I don’t know, you might, you must have to have a hell of an hourly rate to probably be able to pay yourself. A decent wage, let alone keep your office running and the lights on and pay your staff and postage and all that, like, that just to me says that is not a sustainable business model.

I mean, 2. 2 hours [00:18:00] is crazy.

JESS: Yeah. It’s not a lot. And again, you know, if you’re only working 2. 2 hours…

LAUREN: then you’d be killing it.

JESS: What we’re seeing here is that’s not the case there. You know, the average attorney is working at least eight hours, probably more, but really only earning 2. 2 hours worth at the end of the day or, or bringing that money in.

LAUREN: Yeah, and that’s a really small space to start from like that doesn’t give you a lot of margins and then you layer on top their lockup rates or those cash flow rates that we talked about in the beginning. So not only are you only generating revenue on 2. 2 hours, you’re not getting that. potentially, depending on how your billing process is, for months.

And so your cash flow really takes a big hit when you don’t have a lot of room to spare because that’s such a small amount of revenue. The other big takeaway I had from this report is it feels to me that as a [00:19:00] profession, we are very disconnected from our clients. And by that, I mean, What we think about our clients and their abilities or what they’re thinking is very different when those actual clients or potential clients are surveyed in terms of what they’re thinking their abilities are or how they view the profession.

And as a service based industry, that’s very concerning to me that we are not more in line with what our consumers need and want. And there’s A million different pathways that that can go down, but I don’t think we are sustainable, not only from a cash flow revenue standpoint, but if we can’t get on the same page as the legal consumer, the average legal consumer and in the report, it seems to be a revelation.

To the report writers, which is funny to me because we [00:20:00] talk about this all the time, but they have a line in there that says at a certain point, the client’s perception of value reaches as high as point, which is also when the client is most willing to pay their legal bills. Yes. The client will only separate from their money when they see value.

Like how many times have we said that I’m super glad that it seems to be reaching more of the profession, but that’s it. Like of the whole report, that line right there, I feel like is all we need to focus on and extrapolate. Is the client is going to take value and they’re looking for value and they’re not going to pay unless.

They find that, but when we’re so disconnected from what they value, it’s hard for us to have that conversation and make those points to them. And there are just a couple of. I would almost say anecdotal examples [00:21:00] in the data itself, like when we go through these, you might think like, Oh, that’s kind of like a minor detail.

Does that really make a difference? And that thing in a vacuum probably doesn’t, but I would argue that it’s symptomatic of a larger issue. So for example, nearly half of law firms think that they don’t take too much time to send a bill. However long it takes them, they feel like that’s an appropriate amount of time and it’s not too long.

Well, there’s a stat in there that says for 15 percent of the clients who were surveyed, they never got a bill at all from their lawyer on so many levels. Like, what do you mean you didn’t send a bill? Like, so now you’re definitely leaving a hundred percent of that revenue on the table, but that’s a huge disconnect that we’re like.

We send out bills just fine. And the clients over here are going, I didn’t even get one.

JESS: Yeah, I had to laugh at that one. It was, I wasn’t expecting to see that.

LAUREN: And again, in a vacuum, you [00:22:00] might think, oh, that’s not a big deal. 15 percent isn’t like a huge number, but I just think it shows.

We’re just not on the same page, just like when we think about our clients. And I’ve heard this anecdotally from colleagues and it often makes me a bit upset because I don’t like talking about our clients in a negative way. Like they’re the people who pay us, right? But there’s, there’s a data point in here that said 41 percent of lawyers think that.

Too many clients don’t pay on time and that 24 percent don’t pay at all. So nearly 65 percent we see our clients as like bad payers, basically they don’t pay or they don’t pay on time. And that’s always the flippant comment of like, I did pro bono. I wasn’t expecting right. And. I think that goes back to expectations.

I think that’s on the attorney. But we are generally as a profession, viewing our clients as bad payers. And like, they’re the problem when it comes to payment. But when [00:23:00] Clio surveyed the consumer, 84 percent of them said they pay their bills on time and actually 67 percent wanted to pay it right away. So the client is over here thinking like, man, I’m doing a good job.

I’m paying these legal bills, even when I’m sure they are having sticker shock. And we as a profession are thinking that they’re terrible at making payments. And that’s a big chasm between the two sides of a service based industry.

JESS: Yeah, I think it just shows a lack of empathy. It’s not something that we’ve traditionally been good at in the legal profession, kind of taking a step back and trying to put ourselves in other people’s shoes, including our clients.

You know, why is it they aren’t paying? What could be some reasons for these things? Maybe I could ask them, you know, all of these things, but empathy to me is what I’m really hearing or lack of empathy in this particular question.

LAUREN: And that’s, that’s on point. And I think: digging into what is the [00:24:00] issue? Where is the tension there? Where is the friction? Because What I saw blaring from the data is that part of the issue is attorneys are giving bills in person most of the time, more than half of the time, 54%, which I guess is okay because at least the client’s sitting there and you know, they got it, but clients.

Don’t often have time to come to your office every month if that’s how you bill to pick up your invoice, right? That’s inconvenient for them. And then there’s 37 percent of law firms who are sending invoices by snail mail. I don’t think I get… Any bill from anybody at this point, government agency included from snail mail that I then have to send a check back, or I can’t pay online.

That’s a friction point, right? Consumers, when they asked, 46 percent of legal consumers, guess how they want to pay? [00:25:00] Online by credit card. So it’s just fascinating to me that we have just built our profession in a way that has worked for us three, four decades ago when snail mail was the way to go and we refuse generally to get off of that and then sit here and blame the clients and go, Oh, they’re the reason we don’t get paid.

It’s like, well, you’re kind of making it hard. For them to pay you.

JESS: Yeah, 100%. I will acknowledge that perhaps a small percentage of that percentage that we just talked about could be people living in more rural areas, perhaps, where maybe not everyone has access to the internet, but I don’t think it’s anywhere near the majority of that percentage.

LAUREN: Yeah, no, that’s a fair point. I’m glad that you brought that up. I think that these big picture numbers obviously have a lot more nuance to them and knowing your particular geographic area and target market is going to be really important, but to just sort of say, you [00:26:00] know, in general, we as a profession send our invoices by mail.

Is that actually working for your clients or are you just doing that because that’s what, you know, quote unquote, everyone does?

I was really struck in the report by the line that is included that said that the, they’re talking about business levers to improve performance. So they kind of give you all this data and then they try and give a nod to like, how do you make it better if you want to increase performance, but. A lot of the levers that they talk about pulling and pulling in technology to make it easier is really about how to collect money.

And I was really struck by that because I agree technology, if you’re spending half of your time on admin time, you need to get some tech in there to reduce that right to become more efficient. But I think technology across the board is necessary so that we can focus on lawyering and [00:27:00] counseling and doing all the things that AI is never going to be able, I assume, to do on a human level, but all they, all that the report talks about is just how to collect more money, like to offer online fees and to send your bills out on time and use our automatic billing statements. But it’s not about, well, how do we deliver more quality service?

How do we make sure we’re communicating with our clients more? How do we get stuff done? Faster because that’s what the client wants. They don’t want to be involved typically with the legal system or with a lawyer for a prolonged period of time. The report doesn’t talk about those technologies. And I think that’s again where we’re just disconnected from our clients.

They are not there just to give us money. We are here to serve them. Like you just probably like I went to law school to help people. I think most lawyers that I have ever heard say why they went to law school is to help people, but somehow in [00:28:00] the process of it and in the machine of the actual profession, we’ve gotten really disconnected from.

Our clients and what they actually need and serving them. And it’s all about how do we get bills paid faster?

JESS: Yeah, it’s interesting. I think over the years, Clio, they’ve had themes, some of which have been consistent across the report. Sometimes they pick out different themes. For that year, obviously the pandemic was a great example of that, but I wonder here if they chose to focus more on pain points from the lawyer perspective, I would imagine if that was the case, a lot of lawyers would say collection rate being a big pain point, but just interesting to frame it that way to hear that lawyers.

I don’t know if that’s a fair take away from this, it’s hard to tell because we don’t have any information on that, but it is an interesting framing and I don’t know why they chose to go this particular [00:29:00] direction with this report.

LAUREN: I think that’s a fair point. And even if that was unconscious or not intentional, I think that it continues to support the narrative and we don’t realize that we’re doing it.

But when you put out data, which again, no knock on Clio, I think these reports are super helpful. I like going through the data to see trends in the profession. I think we can pull out a lot of opportunities and we wouldn’t have had that without. Them putting together this report, right? Like making decisions based on data is going to be far more productive in any aspect of life.

So I appreciate that they do that, but I wonder if the framing that they look at or the lens that they share this data through or the interpretation doesn’t continue to perpetuate that narrative that I don’t think is overall helpful.

JESS: Yeah, and that’s a great segue to what I think my [00:30:00] biggest takeaway and frustration is, and I know you share this, but this report is if we, if we zoom out, it really is the framing of the entire report.

It is all based on the bill hour. So, I mean, there’s a choice there, right? Like Clio has users like you who don’t bill by the hour. They could have chosen, for example, to highlight that type of work and compare and contrast it against the bill hour and all of these things that we just talked about.

Although, I will say, and we were talking about this before we jumped on, a lot of these frameworks that we just talked about, the, you know, the utilization, realization, collection framework, also the, I don’t remember what it was called, the gratitude framework, or whatever that was, which I love, I love, I’m a huge fan, I know you’re a huge fan of taking frameworks from outside the legal profession and applying them to legal, I think that’s really helpful, but In this instance, if we focus on value based pricing, those frameworks don’t really apply.

They’re not super relevant because in that instance with value based pricing, you’re really scoping the work well on the front [00:31:00] end. You are offering a set fee and you are collecting that fee before you actually complete the work. And if that’s what’s happening, we don’t need to have these discussions about utilization.

Realization and collection lock up because you are collecting that money. Your cash flow is good. And by doing all these things, those are very client centric things that will spill over and cause you to have repeat clients, good reviews, etc, which will then help you continue to bring in clients and I guess one thing that is just really frustrating for me is I hear Clio talk a lot about being client centric, building a client centric firm. Jack Newton, the co founder of Clio, even wrote a book about it.

I really challenge Clio and anyone, frankly, to demonstrate how building by the hour is client centric. I just don’t think you can do it. And this entire report is built around it. And I think it’s I think it’s failing lawyers. I think we’re failing lawyers by [00:32:00] continuing to frame reports and conversations this way.

I think it needs to be more expansive. I think we need to talk more about the benefits of value based pricing and to I’ll give Clio a little bit of credit in previous reports, they’ve talked about it a little bit more, not a ton, but more than they have in this report. Certainly. I think we need to focus more on that.

I think that’s what’s going to not only benefit legal consumers, it’s going to benefit lawyers. Like we talk about this all the time. So it’s just frustrating to, to read through this report. I think it was a missed opportunity.

LAUREN: I just can’t get away from the data that is glaring that says lawyers have a 25 percent higher caseload. And yet are only earning 2. 2 hours, which has been about the average for the last seven years, six years that they’ve been including that kind of collection rates in their reports, it’s hovered right around two hours. So it’s not like. I mean, maybe if it went from one [00:33:00] hour to two hour, we’d all be cheering cause that’s a good improvement.

But at a macro level, it’s still two hours a day. And that seems like, you know, that kind of hedonic treadmill, like it just, the treadmill is getting faster and faster and faster. And we just keep running faster and faster because the system is not set up in a way. That benefits us, and it doesn’t benefit the client.

I think that inherent conflict of interest that seems to go kind of unnoticed about billing by the hour is kind of illuminated in these different ways when you look at the data. You know, lawyers who are more efficient and use technology to produce more quality work at a quicker pace are not rewarded when they bill by the hour, right?

They just have to get more clients to do that, to bill more time because they’re getting better at their job. And that’s one, just one example to your point that that doesn’t serve. Either side, it doesn’t serve us as the attorney and it doesn’t [00:34:00] serve the client. And I don’t know how many more reports we can get that say lawyers are working more.

Yay. Our billable hour is getting higher. Great. But we’re still on that treadmill and we’re not building thriving businesses. Like we, you’re right. We shouldn’t be talking about collection rates because there’s a system and a approach that doesn’t need any of that.

JESS: Yeah. And I will just add that you just talked about this.

Like there’s this tension too, between Clio as a client management software product built around the billable hour. So they’re encouraging lawyers to bill by the hour. As you said, as somebody who doesn’t do that, their platform isn’t great for that. You have to find workarounds for it. So there’s a tension between that and then, Hey, like if you use our software to some degree to maybe create fleeting’s faster and do some of these things.

With respect to the delivery of the legal service, well, you then can’t bill as many hours like it’s this [00:35:00] really weird tension that’s I feel in the report and that certainly exists and I, I don’t know if Cleo feels that as well but it’s also then baffling to me why they then don’t make some changes to their platform to support attorneys who are offering alternative arrangements like that.

I think that’s just better for everyone, including Clio long term.

LAUREN: It’s certainly better for the client. I mean, even in their survey about the whole AI discussion, which I think the general consensus is, is it’s a little early in legal for sure. Clients even said that they were open to it. One, if the lawyer was transparent about it.

So If you think clients don’t want transparency about pricing, they wanted about how their legal services are being delivered, but two, they were more open to it, even though in general, they will were skeptical, but the clients said that they were open to it if it. Made legal services more affordable, and if the [00:36:00] legal services they received were of a higher quality, so clients are willing to take a pretty big risk in a technology that we as a society are still grappling with its abilities and what it can do and the moral and ethical and.

All of that of it and clients are like, I’ll wait in those crazy waters that are a little bit murky. If I can get legal services that are more affordable and of higher quality. And I feel like as a profession, we shouldn’t have to force clients to do that risky or behavior. When we have an ability to provide affordable legal services that are of a higher quality in a way that is way better for us and way better for them without that risk.

JESS: Yeah, huge mismatch between supply and demand for sure, but an opportunity for anyone listening to this podcast who maybe is billing by the hour and experiencing some of these pain points outlined in the report. There, there’s so much opportunity to make change and to [00:37:00] meet those needs. There’s a lot of business out there.

It’s an untapped market.

LAUREN: Although the report initially to me felt like we were just beating a dead horse of like, this isn’t working. How many more reports do we have to show that the traditional model that worked in the eighties is not working in today’s market. But if you take a little bit more of a optimistic approach, I absolutely agree.

For where there is a challenge, there is an opportunity. And if you’re willing to identify the troubles with the billable hour, the troubles with the way that we structure the profession right now in terms of the delivery of legal services, and are willing to say, I’m going to throw that out the window because I’m tired of this treadmill that just keeps going faster and faster, and I’m going to try something different.

Man, that opportunity is huge. And I think that if you’re one of the first in your geographic area and your practice area, even in the profession as a whole, cause we’re still [00:38:00] lacking behind, you are going to immediately see huge increases in growth in your business because consumers are clearly dying for a delivery of legal services that meets their needs.

So if you are a solo or small firm lawyer or law firm owner, and you have found this episode has really resonated, you’ve seen the opportunity you’ve seen and felt that the way that things have been going and the traditional model isn’t working. You’re ready to get off the treadmill and actually learn how to run a business in today’s market, where you aren’t having to work more to earn less.

We are really excited because we’ve got a great solution for you. So this is the first time we are announcing this to all of our wonderful podcast listeners. You are the first to hear in 2024, we are starting a Law Firm Growth Mastermind. This came out of hearing from countless frustrated solo and small firm owners like you [00:39:00] that share with us that they feel stuck.

They have learned one way to run a business. They are killing it as a lawyer. Their legal skills are top notch, but the way that they have learned to run their business is not optimized. For growth and they just feel stuck. They don’t know what else to do. They feel like they’re on that treadmill that just keeps getting faster.

And when they see data, like we went over today, they say, yeah, that’s exactly my experience. And we believe that it all leads back to one thing. You were never taught how to successfully run a law firm as a business in today’s market. But we know how we know how to build a practice that you love. We know how to earn more by working less.

And I say that from experience. I have read all the books. I have gone to all the webinars. I have tried all the things. I have had lots of trial and error. And after eight years, I have [00:40:00] figured out a system where I work Part time and sell more than a quarter million dollars a year. So I know that this is doable and we’re taking all of that knowledge and boiling it down to give our mastermind members the practical tips that they need to do the exact same thing in their practice.

We’re going to cover topics like vision, goals, and mindsets. We’re gonna talk about branding and marketing for your firm, finance, pricing, client acquisition, automation, and templates. How do you make a firm that works for you where you can work less and earn more and start to accelerate your growth? We will show you exactly how to 2x your sales by working less.

You can join from anywhere and collaborate with like-minded lawyers, sharing your experiences and discovering fresh approaches for optimizing your law firm. You’re going to learn how to streamline workflows and create templates so that you can work smarter, not harder, and achieve more [00:41:00] while reducing your workload.

So if you’re ready to revolutionize your law firm’s operations, increase profits, and achieve the work-life balance that you’ve always dreamed of, sign up for our Law Firm Growth Mastermind. There are a limited number of seats, so do not wait. This will fill up fast. We cannot wait to go on this journey with you and see how your law firm looks different in just 12 months when you go through this program with us.

You can learn more at And that’s

Thank you so much for spending your time with us today. As always, we appreciate it. We hope that going through this report was helpful. Like we said, there’s not a lot of data points that we get in the profession. So we are very appreciative to Clio for putting this all together and providing these data points every year. Feel free to look up the report yourself. Again, that’s at clio. com or you can just search Clio Legal Trends Report and you’ll find it. [00:42:00] Do take it as an opportunity. Use the data to continue to make intelligent decisions.

If you have any insights that you pull from the Legal Trends Report, feel free to leave us a voice memo. We’d love to hear what insights you take, how you interpret the data, and how maybe it aligns or doesn’t with your experience as a member of the profession. Thanks so much for listening. We will catch you next time.

Until then, keep building a different practice.

We’re over here giving you a virtual high five because you just finished another episode of A Different Practice. For more from this episode, head over to for our show notes. If you found this episode helpful, we’d love it if you’d share it with someone. Be sure to rate the show wherever you listen to podcasts and don’t forget to subscribe so you never miss an episode.

If you’re looking for even more practical tools to optimize your law practice for growth and enjoyment, sign up for our monthly newsletter at [00:43:00]. We can’t wait to connect with you next time. Until then, keep building a different practice.