Coleman Watson | Crain's Orlando

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Coleman Watson

Background:  

Coleman Watson is the managing partner of Orlando-based Watson LLP, a law practice that specializes in technology, including video game matters, intellectual property, patents, trademarks and copyright licensing. The attorneys of Watson LLP also counsel clients on election law, sports law and entertainment law. The firm was founded in 2015 and has offices in Atlanta, Los Angeles and New York.

The Mistake:

I assumed that I had to follow in the mold of my previous employers and try to do the same, very traditional procedures and processes that these great companies had done.

I got an engineering degree, then worked for a national engineering firm. It was a very large corporation, very traditional. Processes were already in place. And it worked, and it was fine for a national corporation that had a client base and name recognition. While I was in law school I worked for American Express in the patent prosecution group. It was obviously a Fortune 500-type company with very strong processes in place.

After law school, I moved to Florida and I worked for a large national law firm, a very traditional firm that only did billable hours and [was] not very quick to grasp onto new technology because what they’d always done had always worked. And that was fine for them. They had the name recognition to do that.

So coming from this background, I was just too groomed to assume that, if I opened my own business, I had to try to follow that mold. But after the first six months of doing that, I was spinning my wheels. As a new person starting a firm, you can’t compete with those who have a 100-year history with the market and brand recognition and a client base. It was very hard to break in.

And in my mind, a lot of the stuff the legal industry does now is totally broken. It’s one of the last few industries that try to cling to a pure billable model. Businesses don’t like that because it’s not very predictable. You may have a legal engagement, and basically, you [need] an open-ended checkbook because you don’t know how long it’s going to take. If you’re an individual, usually you can’t even afford that kind of law firm.

A lot of the stuff the legal industry does now is totally broken.

The Lesson:

I started asking myself, “Maybe I’m doing this all wrong? Maybe I need to try to flip the entire legal industry on its head?”

The billable model that most law firms use now is just not sustainable. I would not be shocked if in the next 10 to 20 years clients just demand, "No, we’re not going to pay like this anymore." I looked at my billing structure and tried to make it as lenient as I could. We’re not just purely a billable-hour firm. We certainly do billable hours if you want to pay that way. We’ll also give you a projected cost. We can also do a contingency or a reverse contingency – which is typically on the defense side, namely patent litigation.

Lots of CEOs and in-house counsel really want to know what the range of fees is that they’re looking at. Otherwise, the exposure’s too high. So we really try to be smart about our fees.

I also started to look at who my clients were, and they were young and emerging companies, and I was a young, emerging law firm, so I talked to my clients and said, “How do you want to communicate with me?” And I got really, really tech savvy, and I streamlined my practice to almost match what my clients were doing.

For example, if they were using Slack to communicate internally, then I would add a private channel for Slack and they could communicate with me through Slack. The next thing I did was design a really intuitive client portal that connects my clients to their legal engagements, every step of the way. A big complaint I had at another law firm was that a client would call and they’d be very upset because they hadn’t talked to you in three weeks and all of a sudden they get a $30,000 bill.

Now clients can always log in to our time system and see where they are billable-wise and then call me and say, “Hey, hang on a second, let’s maybe slow down this month and we’ll do something next month.” It gives them predictability for budgeting purposes. My biggest goal on a day-to-day basis is to always keep my clients in touch with their matters.

Photo courtesy of Coleman Watson

Do you have a good story you’d like to share, or know someone we should feature? Email nryan@crain.com.

And be sure to sign up for your local newsletter from Crain's Orlando.