The legal profession has been through the wringer over the course of the past year or so. With economic uncertainty in the air and layoffs top of mind for attorneys at larger law firms, some smaller firms are still trying their best to achieve growth, despite these trying times. How can this be done when the odds seem to be against them?
Who better to answer this question than the leader of a notable smaller firm?
Staci Zaretsky (SZ): Over the past year or so, the legal profession has experienced some disruption due to the economy. How do you think law firms can continue to grow during times like these?
Vito Gagliardi, Jr. (VGJ): Disruption can be uncomfortable, there’s no doubt. And serious economic disruption — like that accompanying the Great Recession — can cause a lot of pain for the profession (not to mention individuals). But disruption creates opportunity. Law firms can stay healthy not by thinking about growth, but about what new client needs are being created by the disruptive changes in their areas of expertise. Is the government enacting responsive regulations that they need to understand? Does their client base have a need to reduce its legal spend? Considerations like that drove us to create Porzio Life Sciences, which automated compliance-related tasks for pharmaceutical companies and was an engine of our growth for years.
SZ: How has the private equity sale of Porzio Life Sciences, the firm’s legal tech subsidiary — which I believe was a first for a U.S. law firm — helped the firm expand its resources?
VGJ: As far as we know, it was indeed the first sale of a law firm subsidiary to a private equity portfolio company. The sale certainly added to the financial resources behind Porzio Compliance Services, our subsidiary dedicated to assisting clients with compliance issues across a variety of industries and helping them decrease their organizations’ risks. We are aggressively expanding our capabilities into areas such as education and cannabis compliance, as well as licensing and distribution in life sciences and other key industries. Equally important, the sale acted as proof of concept, confirming that we can develop tools to automate our clients’ work that are truly valuable to them — and us — and that law firms can successfully act as incubators of innovation. We are energized to continue looking for opportunities to make legal and quasi-legal tasks easier to perform.
SZ: In today’s legal landscape, clients are increasingly seeking innovative and cost-effective solutions. How can firms keep up with evolving client demands and foster innovation within the firm?
VGJ: Necessity is the mother of invention, they say. If you understand that you have to innovate or get left behind, you’re halfway there. There’s nothing to do but get serious about it.
But not all law firms realize that it’s necessary for them to introduce innovations that increase their productivity and reduce their clients’ costs. They will keep doing business the same way and probably get along fine for a number of years to come. Eventually, though, they are going to get passed up, and then it will be too late. We will not be in that position.
SZ: What strategies can firms employ to recruit and retain exceptional legal professionals, and how does this contribute to growth objectives?
VGJ: Before a law firm can land talent that is going to help it grow, it has to take a preliminary step: figuring itself out. What are the key qualities of the firm, and why would someone want to work there? If you can’t answer that, no one can. We have a clear identity. We’re a relatively small general practice firm, headquartered in New Jersey, with elite practitioners (including several former judges and prosecutors) and a history of helping clients in highly regulated industries, including pharmaceuticals. We value excellence in our work and take an entrepreneurial approach to the practice of law. Significantly, we adopted the following philosophy over 20 years ago: we are serving the best interests of our clients by serving the best interests of our people.
Firms are on the right track when they can describe themselves with enough specificity that they turn some prospects off. If that’s true, they’ve probably painted an accurate enough picture that others — the right people for them — will be drawn in.
SZ: What advice do you have for an associate who may be considering making a lateral move to a firm like yours?
VGJ: Sleep on it. We don’t want lateral associates who are in a rush to make a move. We want laterals who are acting from a long-term view and see an advantage for themselves in being in a smaller environment, where they will know the names of all their peers and have ample room — if not expectation — to become a leader in their own area. They should also have an appetite for taking some business risk in exchange for potential reward. Every lawyer at our firm benefitted from the sale of Porzio Life Sciences, whether they were directly involved with it or not.
On behalf of everyone here at Above the Law, we’d like to thank Vito Gagliardi, Jr. of Porzio Bromberg & Newman for taking the time to help answer some pressing questions on how law firms can continue to grow during tough economic times.
Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter and Threads or connect with her on LinkedIn.