Mastering Profit First: Transform Your Law Firm with RJon Robins

In the competitive world of law, success is not solely measured by case wins, but also by the financial strength and stability of your practice. The latest episode of The Lawyer Millionaire Podcast offers a rigorous exploration of the tenets of financial acumen in the legal profession. We welcome esteemed guest, RJon Robins, a pioneer in law firm profitability, who provides a profound discourse on the fiscal responsibilities that come with firm ownership. His expertise is a linchpin for those seeking to excel in the financial management of their legal practices.

What Listeners Will Learn:

1. The transformative effects of applying the “profit first” methodology to enhance your firm’s financial health.

2. The ethical mandate for financial competence and the consequential importance of profitability in law firm management.

3. Effective tactics for overcoming internal resistance when introducing and implementing crucial financial structures.

4. The vital role that financial stewardship plays in fostering client trust and the holistic success of your legal team.

5. The indispensable business competencies necessary for enduring prosperity in the legal domain, as illustrated by Robins’ wealth of experience and introspective journey.

Scaling Up Your Firm with Robins

During the discussion, Robins points out the importance of reading “Scaling Up” and hints at his upcoming project, “Scaling Up for Firms 10 million to 100 million”, highlighting its potential as a game-changer for your practice. Furthermore, leveraging his book, “Profit First for Lawyers”, he uncovers the pivotal significance of being financially literate and prepared for implementing profit-first principles, even in the face of possible resistance from employees.

Robins’ expertise doesn’t stop at literature. He also hosts the “Profit First for Lawyers” podcast, serving as a rich repository of knowledge for implementing the Profit First system in high-revenue firms. His advocacy for this system stems from the ethical obligation lawyers have to run a profitable business, focusing on the ultimate benefit this can bring to clients.

A Lawyer’s Financial Ethics & Client Care

In an enlightening exchange with Darren, Robins stresses the ethical implications of financial stability within a law firm. He posits that a lawyer should not only master their legal expertise but also demonstrate sound financial management. This, he suggests, not only impacts the health of the firm but the core service delivery to clients.

The Confluence of Personal and Business Finances

RJon Robins candidly shares his journey of rapid financial growth and acknowledges the emotional and habitual challenges that accompany such success. He champions personal financial planning as crucial for law firm owners, positing that managing personal wealth effectively goes hand in hand with running a successful firm.

Conclusion:

This episode of The Lawyer Millionaire Podcast with RJon Robins is packed with profound revelations that could catalyze your journey to becoming a financially savvy and ethically responsible law firm owner. Take advantage of the bonus materials offered in our show notes, and don’t forget to read Robins’ influential book, “Profit First for Lawyers”, to jumpstart your Profit First journey. We thank RJon Robins for his unmatched insights and invite our audience to harness this knowledge to forge a path toward financial independence and personal fulfillment.

Resources:

Wurz Financial Services

Connect with Darren Wurz:

Connect with RJon Robins:

Facebook: RJon Robins
Instagram: RJon Robins
Linkedin: RJon Robins
Website: Profit First For Lawyers
Profit First For Lawyers Resource Bundle

About our guest:

RJon Robins is the one common denominator behind more multi-million-dollar law firms than anyone else on the planet. RJon believes in profit, and he detests loss.

Since he first reported for duty as a Small Law Firm Management Advisor with The Florida Bar’s Law Office Management Assistance Service (LOMAS) under the legendary J.R. Phelps (1999) and since founding How To Manage A Small Law Firm (2009) RJon and his team of wildly qualified law firm business management advisors have coached, counseled, advised, and kicked the butts of thousands of wildly successful small law firm owners. Yes, we know we used the word “wildly” twice in that sentence – what How to Manage a Small Law Firm does is that good.

The only three things that piss RJon off are:

The Doctrine of Sacrifice
People who would have you embrace The Doctrine of Sacrifice
The BS those people often spew to try and convince you, as an entrepreneur that you should somehow take pride in how much you suffer but apologize for how much value you create for yourself and others.

Oh, and in case you’re impressed by this sort of thing RJon is a Member of The Florida Bar, he’s authorized to appear before The Southern District Federal Court, he’s a Member of The Association of Certified Fraud Examiners, his company How To Manage A Small Law Firm has been named by Inc Magazine as one of the 5000 Fastest Growing Privately Held Companies in the United States every year since 2015 and after 15 years of marriage his wife still thinks he’s funny.

Why Did RJon Write Profit First for Lawyers?

After working with thousands of law firm entrepreneurs for many years, RJon wanted to write a book dedicated to business owners who are committed to growing their law firm and living a better life. RJon has seen first-hand how “conventional wisdom” has led many entrepreneurs astray and wanted to share what he knows will help them turn their businesses around.

If entrepreneurs implement what’s explained in the book, their law firms WILL become more profitable and they WILL feel more satisfied.

But this book will probably piss them off too.

Why? Because when they discover the culprits who have been keeping them separated from their profits… It will probably piss them off. One day they will wake up and be pretty pissed about all the bad advice they’ve been given.

Ready to Take the Next Step?

If you are ready to take the next step and experience even MORE personal and professional growth, then you may be ready to become a member of How to Manage a Small Law Firm.

If you already know an HTM Member, GOOD. Now you need the courage to begin your journey “through the looking glass.”

Don’t know an HTM Member?

Several of our Members volunteer each quarter to “pay it forward” and have a conversation with potential new members about what it’s really like to work with How To Manage. Based on that conversation, they’ll send you a referral to have a formal consultation with someone from our New Member Engagement group.

If our team believes we can help you achieve your goals they’ll recommend the next-best step for you. Fill out the “I’m Interested in Joining HTM” form and you’ll be introduced to one of our members.

Transcript:

Darren Wurz [00:15:48]:
Arjun, we’re so excited to have you here today on the lawyer millionaire. There may be some listeners, I want to dive right in here. And you know, there may be some listeners who’ve heard your belief that law firm owners should pay themselves first. I believe this, too, by the way. But this is an idea that sometimes goes against the traditional method of accounting that we’ve sometimes become accustomed to.

RJon Robins [00:16:16]:
That’s because the traditional method of accounting sucks.

Darren Wurz [00:16:20]:
Yes, it does.

Darren Wurz [00:16:21]:
Yeah.

Darren Wurz [00:16:21]:
And we’re going to talk all about that. But let’s start with why, right? Why is it absolutely crucial for the financial success of law firm owners to pay themselves first?

Darren Wurz [00:16:32]:
Right?

RJon Robins [00:16:32]:
So let’s start off with the basic idea, right? Number one, a law firm is a business, right? It’s a business that markets, sells, delivers, and if you do it right, gets paid for solving people’s problems for legal services.

RJon Robins [00:16:50]:
And a lot of lawyers have a real problem because they get brainwashed into thinking that it’s just about the practice of law. The practice of law is a great, wonderful, noble profession. I went to law school, too. But the business of a law firm is completely different. And you gotta, like, separate yourself. It’s like the child who one day realizes, I’m not my mother.

RJon Robins [00:17:17]:
You know, little babies, when they’re first born, they think of themselves as the same entity as their mother. And then they get to a certain age and they start realizing, eventually they realize, my mother is my mother and I’m me. My law firm is a business and I’m me. And the purpose of the law firm is to serve your life. And if your law firm isn’t serving your life, then what do you have it for? Like, for real? Why do you have a law firm if it’s not working for you? It’s a business.

RJon Robins [00:17:50]:
So in our world, we talk about a successful law firm, and every, every law firm I’ve spoken with literally tens of thousands of lawyers, I’ve been doing this since 1999. I’ve been talking to tens of thousands of lawyers, and everyone agrees with the basic definition of a successful law firm, right? And anyone who doesn’t is a lunatic.

Darren Wurz [00:18:16]:
So what is that? What’s the definition?

RJon Robins [00:18:18]:
Well, you want your business to serve you financially, right? If it doesn’t give you enough net operating income, if it doesn’t give you enough profit, forget about frickin gross revenue. Gross revenue is what we apply for. Inc. 5000 awards with gross revenue is what we go and we, every year we celebrate all of our members who broke the seven figure barrier for the first year. We have a whole big ceremony. We give them a ceremonial hammer for breaking the seven figure barrier. I think this year we had 40 of our members who broke the seven figure barrier for the first time in their life with their law firm. And we celebrate every month, you know, who has broken the seven figure barrier in the first quarter of the year, the second quarter of the year.

RJon Robins [00:19:01]:
And so, but that doesn’t, that doesn’t feed your family, right?

Darren Wurz [00:19:05]:
Yeah.

RJon Robins [00:19:06]:
That’s just for rewards, right? Your business has to serve you financially. It has to give you enough profit to live the way you want to live. Now, I’ve posed this question to literally thousands and thousands and thousands of some of the most highly educated human beings on the planet. And I’ll tell them when I pose the question, I say, listen, I’m going to ask you this question, but let me tell you the question. I’m not asking you, I’m not asking you to tell me what you can settle for. I’m not asking what you can get by on. I’m not asking you to tell me all the things you can do without. I’m asking you, how do you, in your heart of hearts, honestly, if you’re true to yourself, how do you really want to be living your life? What house do you really want to be living in, what car do you really want to be driving? What vacations do you really want to be taking? What domestic services you really want to be employing? What education do you really want to provide for your children? What kind of charitable interests do you really, honestly, authentically have? Do you have people in your family who you want to support maybe elderly parents.

RJon Robins [00:20:11]:
How, how much does it cost to live the life you want to be living? Because it’s a lot easier to build a law firm that gives you the life you want to have than it is to run a law firm that merely gives you a life you’re willing to settle for, which is a paradox that most lawyers struggle with. So, anyway, definition of a successful offer. Number one, it serves you financially, right. Would anyone call a business a restaurant, a shoe store, an ice cream shop, an accounting firm? Would anyone call it a successful business if it didn’t generate enough profit for the owner to live the way they want it to live? I don’t think so. Two has to serve you personally, right? You make millions of dollars a year, but you have to work 12 hours a day. You have no control over your time. It drives a wedge between you and your family. You’re just like a prisoner to your business.

RJon Robins [00:21:05]:
That’s not a successful business. It might be a profitable job, but it’s not a successful business. And the third element of a successful law firm is it has to serve you professionally. It’s got to help you make a positive impact in the world. It’s got to do something to feed your soul. And this isn’t just, like, aspirational. This is practical, because I’ve worked with tens of thousands of law firm owners. Remember, I’ve been doing this since 1999.

RJon Robins [00:21:37]:
And what I see, what you see over and over and over and over again is if the work doesn’t feed their soul, they won’t do it.

Darren Wurz [00:21:47]:
They quit. Right?

RJon Robins [00:21:48]:
So it’s got to feed your soul. It’s got to give you a personal life, and it’s got to serve you financially and allow you to live the way you want to live. That’s the definition of a successful law firm. And if your law firm isn’t meeting these three standards, it’s not successful yet. There’s something you can do about it. Law firms are relatively simple businesses to fix and turn around and make them work. But first, you got to be honest with yourself. Do you have a successful law firm or not? Which led me to the book product plug.

RJon Robins [00:22:20]:
Now, profit first for lawyers. Get it at Amazon. Um, yeah. That’s why you got me on the show.

Darren Wurz [00:22:26]:
Yeah, absolutely. I love that. And it’s so intricate, the connection between your personal life and your business life when you’re a law firm owner. One of the reasons I love working with law firm owners, and it is such a struggle. You know, you may hit that seven figure mark, but not be taking home adequate amount of money. Right. You have seven. You’re making seven figures in your firm, but you don’t have seven figures in the bank.

Darren Wurz [00:22:51]:
Right.

Darren Wurz [00:22:51]:
And that’s a problem. So first time that we broke seven.

RJon Robins [00:22:54]:
Figures in my business, which was back in 2012.

Darren Wurz [00:22:58]:
Yeah.

RJon Robins [00:22:58]:
We were really proud, and we shared it with our family and our friends and everything. And I remember we had a family member who’s a sophisticated person. I mean, this isn’t like some dumb, ignorant person who doesn’t know anything, right? This isn’t. This is a person who owns her own business, owns investment properties and educated, successful person. And she said with real enthusiasm and happiness for us. Oh, congratulations. You’re millionaires. We’re not millionaires.

Darren Wurz [00:23:28]:
Right.

RJon Robins [00:23:29]:
We broke the business, grossed a million dollars.

Darren Wurz [00:23:33]:
Yeah, yeah.

RJon Robins [00:23:34]:
But that doesn’t make you a millionaire.

Darren Wurz [00:23:36]:
Right.

RJon Robins [00:23:38]:
And one of my favorite quotes is by Zig Ziglar.

Darren Wurz [00:23:42]:
That butcher it.

RJon Robins [00:23:44]:
He said, the best thing about becoming a millionaire is who you have to become in order to become a billionaire. Love.

Darren Wurz [00:23:53]:
I like that. Yeah, that’s good. And I love Zig Ziglar, too, by the way, so.

RJon Robins [00:23:58]:
Well, this is the problem that law firms have.

Darren Wurz [00:24:00]:
Right.

RJon Robins [00:24:00]:
This is exactly the problem that law firms have. Particularly. I know on your show you’ve had a number of trial lawyers who do contingency work. And the thing is that in the, in the legal industry, you don’t have to become a different person to make a million dollars. You can just get lucky once.

Darren Wurz [00:24:22]:
Yeah, true. That’s true.

RJon Robins [00:24:24]:
And the problem is, if you don’t evolve, if you don’t grow, if you don’t become the owner, you don’t become, in your mind, the owner of a million dollar, multimillion dollar business. The money comes, the money goes. You can’t hang onto it. You have to be changed who you are and evolve as a person and develop into a million dollar person.

Darren Wurz [00:24:50]:
Right. Yeah.

RJon Robins [00:24:51]:
I mean, there was a time when, if I had $50,000 in the bank, I was like, oh, this is great.

Darren Wurz [00:24:57]:
Right now.

RJon Robins [00:24:58]:
It’s like if I’ve got less than multiple seven figures in my account, I’m like, oh, what’s going on here?

Darren Wurz [00:25:07]:
Yeah, it is an evolution of thinking, and I see that a lot on the personal finance side, because you have to think differently to manage a larger amount of wealth, and you have to develop new habits and new ways of thinking. Otherwise, what happens is you get this great income, and then you end up blowing it on things you don’t really, truly want and not really getting down to the core of who you are and what you want and using that to develop a life that really satisfies you.

RJon Robins [00:25:42]:
Jeff, two of my favorite episodes from your podcast are the one where someone interviewed you about financial literacy for children, which I love that episode. My son is eight years old right now, and after I listened to that episode, I was telling my wife, he’s like, we need to, um. And then the other episode is, um. It’s the one about. I’m looking at it because I’ve got her book. I discovered her book on your podcast. It’s, um. Money is emotional.

Darren Wurz [00:26:15]:
Ah, yes. Yeah.

RJon Robins [00:26:16]:
Um. Great.

Darren Wurz [00:26:17]:
Christine Lucan. Yeah, that was a good one, for sure.

RJon Robins [00:26:20]:
You know, the thing is that, like, like, look, you know the thing about the boiling frog, you just turn up the temperature little by little by little by little, which, by the way, apparently that’s not true. But everyone gets the idea. Yeah, snopes busted that myth. Anyway. Apparently you can’t boil a frog.

Darren Wurz [00:26:40]:
Now everyone’s going to go try.

RJon Robins [00:26:42]:
Yeah. So what you learn on the Lawyer Millionaire podcast, I learned you can’t boil a frog. Anyway, so look it like this, right? Let’s say your personal income is $100,000, right? And next year we grow your income from 100,000 to, let’s say 110,000. And next year you grow from 110 to 120 and 120 to 100, 5150 to 175, 175 to 200, 200 to 225 and 225 to 250 and 250 to 275 and 275 to 300 and so on and so forth. Think about how little your life will actually change, right? Because that 1st $10,000 of extra income is only going to give you like an extra $400 a month after taxes. What are you going to do? I mean, moving to a new house for $400 a month? No, you’re going to maybe go out for dinner once or twice extra per month and then you get used to going out to dinner once or twice extra per month. And then we increase your income by another ten or $20,000. And so you’re making an extra 600, $800 a month after taxes.

RJon Robins [00:27:54]:
What are you going to do, change your whole life? No, maybe when it comes time to get your next car, maybe you’ll get a slightly nicer car. So now you get used to going out to dinner once or twice extra per month and you drive a slightly nicer car, right? And then the next year we grow your income by another ten or 20,000 a year. And, you know, you’re already used to driving the slightly nicer car, you’re already used to going out to dinner once or twice extra per month. So we put an extra, you know, 800 or $1,000 a month after tax in your pocket. What are you going to do? Okay, so now maybe you take a slightly nicer vacation, right?

RJon Robins [00:28:29]:
And if you do this little by little by little by little by little, it creeps up on you.

Darren Wurz [00:28:33]:
It does.

RJon Robins [00:28:36]:
But this is not what happens in my business.

RJon Robins [00:28:40]:
In my business, we take a law firm and we grow it from $250,000 in gross revenue to $500,000 in gross revenue, boom, in 18 months, we go from 500,000 in gross revenue to a million, million and a half in gross revenue, boom, in about 18 months. We go from a million dollars in gross revenue to $2 million, boom, in about 18 months. And the bigger it gets, the faster it grows.

Darren Wurz [00:29:05]:
Yeah.

RJon Robins [00:29:05]:
And now you’ve got some real financial changes that you have to cope with. And if you don’t grow up emotionally with your money, really bizarre stuff starts to happen.

Darren Wurz [00:29:21]:
It does.

Darren Wurz [00:29:22]:
You start to learn very new things about yourself. You start to really discover new beliefs and new attitudes, and it really reveals who you are as a person.

RJon Robins [00:29:34]:
That’s the biggest thing. People come to us a lot, and they’re like, oh, I’m really worried about increasing, I’m worried about increasing my income so much because I’ve heard usually from people who have never actually had any real money, right? Oh, you know, money makes you a bad person.

RJon Robins [00:29:50]:
Money simply magnifies who you are. If you’re an asshole and you’re broke, you’re going to be a broke asshole who doesn’t have a lot of financial resources to indulge your asshole tendencies. And if you’re a wealthy asshole, you’re just going to have more financial resources to indulge your asshole tendencies. If you’re a really good person, a nice, kind, generous, giving, generous, you know, nice person, and you’re broke. Talk about fucking frustration, right? Because now you’ve got all these desires to do good in the world and to help people, but you’re fricking broke and you’re frustrated. You know, Gandhi said that poverty is, is, is one of the greatest cruelties because it denies good people the resources to, to do good in the world.

Darren Wurz [00:30:38]:
Mm hmm. Anyway. Yeah. That’s so true.

Darren Wurz [00:30:42]:
Well, I love it, you know? And you really have to develop habits. Yeah, I love it.

Darren Wurz [00:30:48]:
Yeah.

Darren Wurz [00:30:49]:
I mean, you have to develop those, those habits and those attitudes of success early on. I’m a big advocate of that because I’ve often said, if you’re not saving any money making $200,000 a year, you’re not going to be saving any money making $400,000 a year. You have to develop those habits. That’s why I love the profit first system for that attitude and that methodology. It’s like, okay, you have to build that in and start thinking about profitability and, and taking compensation, compensating yourself correctly and fairly from the get go to.

RJon Robins [00:31:24]:
Put to play off of what you just said. Look, if you can’t run your law firm on 99% of the revenue that you’re currently generating, then you desperately need to call how to manage a small law firm and let us help you fix that. Everyone can run your law firm on 99% of whatever you’re currently making. You’re not going to miss 1%. But that 1% starts to build, and you start to develop the habit, and you start to develop the muscle, and you start to develop the self respect. And the self respect is a big part of it, right? And then one or two quarters goes by, and you say, you know what? I’ve been running this business on 99%. Let’s see what happens if I run it on 98%. And you know what? The business won’t miss that one extra percent.

RJon Robins [00:32:18]:
And then next thing you know, you’re taking 10%. Next thing you know, you’re taking 15%. Next thing you know, you’re taking 20% off the top.

RJon Robins [00:32:31]:
Right? Yeah, I know you could. I know you said I could curse, but I’m not going to say this because this is my stage. This is your stage, and everyone else can go suck it. You know what? Because you know what? If you don’t take your money off the top, everyone else will. You pay all your vendors, you’re going to pay all your employees, you’re going to pay everyone, and you and your family are going to be left at the back of the fucking line, pissed off, which, by the way, is going to fuck up your business in all kinds of ways. Because when your home life is chaotic, because you’re financially strapped at home, it causes lots of bad decisions in your business, which paradoxically prevents the business from growing the top line gross revenue. So this is a very practical, ethical, good, professional way to run a more successful law firm because you got to get your home life. I mean, let me tell you, making decisions about your business when you have no mortgage on your home, making decisions about your business, making decisions about your long term strategic planning, making decisions about your staff when you don’t have to think when you’re not worried about how to pay your bills for the next few years, it helps you make better decisions.

Darren Wurz [00:33:59]:
Yeah.

Darren Wurz [00:33:58]:
And I think that’s really about the book profit first. Yeah, I think that’s really the heart of it, is that it’s about developing better behaviors, a better mindset and better habits as a business owner, because it’s so easy in our businesses to just sign up for all these expenses and add new things and buy new stuff and all for the sake of growth often. And there has to be some of that, of course, as we’re growing. But it’s very easy to overspend in your business and then you’re left with no money left over.

Darren Wurz [00:34:37]:
And I think that’s really the key component. And really the, the big thing behind profit first is helping business owners to develop those better habits and those key behaviors, uh, early on so that you can take your business and make it more profitable. I mean, there’s, I think there’s a place where people can get it wrong a little bit and assume that profit versus just, oh, I’m just going to start taking all kinds of money out of my business. That’s, I mean, that’s part of it.

Darren Wurz [00:36:45]:
But really, the core message is helping you make better decisions and have a better attitude and a better, healthy mindset when it comes to your business, because it could be so easy to just add these extraneous expenses. We sign up for this service or that service or we buy this thing or that thing.

RJon Robins [00:37:05]:
Yeah, let’s, let’s elevate the conversation.

Darren Wurz [00:37:07]:
Sure.

RJon Robins [00:37:08]:
Because you’re having the $250,000, $500,000, maybe even the million dollar conversation.

RJon Robins [00:36:44]:
Right, A lot of your audience, from what I understand, are multimillion dollar law firm owners. Am I right?

Darren Wurz [00:37:23]:
Mm hmm.

RJon Robins [00:37:24]:
Okay, let’s have that conversation. Because the conversation you’re having right now that you were just having, that’s the under million dollar conversation. Let’s have the over million dollar conversation. Let’s get real here.

RJon Robins [00:37:35]:
Here’s what happens in the real world. The real world is you’ve got a two 3510 $20 million law firm, right? You have a chief financial officer. Your chief financial officer is probably an accountant or a CPA or that type of person. And they fucking hate this book. They hate this book.

RJon Robins [00:37:56]:
The whole chapter in this book about why your accountant doesn’t want you to do profit first. Okay? And the reason they don’t want you to do profit first is it makes their job harder. You know, fuck them and their job being harder, because your law firm is there to serve your life. So here’s what happens over and over and over and over and over and over and over and over and over. And I had more hands. I keep saying over again, right? Over and over and over again. This is why I wrote the book, because Mike wanted me to write the book, and I kind of didn’t write it. Didn’t write it and didn’t write it.

RJon Robins [00:38:26]:
And finally I got so aggravated that I wrote it. Here’s what happens in the real world. And every one of your listeners who has a multimillion dollar law firm has either you’ve experienced this or this is happening in your law firm, and you just don’t know it.

RJon Robins [00:37:23]:
All right? Your accountant or your CFO is not implementing profit first.

RJon Robins [00:38:48]:
Right. And you get to the end of the quarter, or you get to the end of the year, and you discover after it’s too late to do something about it that there’s all kinds of stupid, stupid, stupid waste in your business.

Darren Wurz [00:39:13]:
Yeah.

RJon Robins [00:39:14]:
And no one had to have an uncomfortable conversation because they essentially embezzled your money. Except it’s worse than embezzlement because embezzlement, at least they’re putting the money in their own pocket. What they’re doing is they’re using your money to avoid having to have uncomfortable conversations with your vendors. Your marketing person is wasting your money to avoid having to have an uncomfortable conversation with your marketing vendors. Your director of operations is wasting your profits in order to avoid having to have uncomfortable conversations with the people you’re paying them to supervise and hold accountable. Your director of legal services is wasting your money. They’re wasting your money. They’re using your money to avoid having to have uncomfortable conversations with your attorneys about not meeting their KPI’s, right? And then you find this, and then you get to the end of the quarter and you’re looking for your profit distribution because you see revenues are going up and up and up and everything’s going great.

RJon Robins [00:40:23]:
And you’re like, where’s my profit? And they have, they all have good reasons, they all have good excuses, they all have good stories, and it’s all a bunch of fucking bullshit. Because what it really comes down to is we didn’t prioritize your profits. We put our comfort and our convenience in front of your profitability. Well, fuck that. I’m putting my profits first. And if that forces you, my marketing manager, to have to have an uncomfortable conversation with the vendor who your buddies with about their performance, well, good. That’s your job. And if that means you, my director of legal services, has to actually have a grown up, professional, responsible conversation with the attorneys who I pay you to supervise and hold them accountable to their KPI’s, well good, that’s your job.

RJon Robins [00:41:19]:
And I could just go through all the seven main parts of a law firm and go through that. The point I’m making is when you take your profits out of the business first, it forces uncomfortable conversations, which is precisely why everyone in the business except the owner hates it. And since there’s one of you and ten of them, you’re outnumbered, right? And they try to, they try to convince you that this isn’t. They try to convince you that it’s not possible, and they try to convince you that it’s not practical, and they try to convince you that whatever, whatever, whatever. And if they can’t convince you, then they, then they get together and they stage a little fucking couple and they just don’t do it. So this book is not profit first. Profit. So Mike Michalowicz wrote profit first.

RJon Robins [00:42:16]:
And then he asked me to write a book, profit first for lawyers. And this book is a call to arms. This book is a call to arms. It’s a rallying cry for entrepreneurs who own law firms about why we need to read and implement and defend our right to our profits first. So if you’re getting a little sense of what this book’s about and you like it, can I give a pitch for my podcast?

Darren Wurz [00:42:45]:
Sure, go ahead.

RJon Robins [00:42:46]:
Go to the podcast. Profit first for lawyers. Yeah, but, but for real, like, this is, this is, these are two different conversations, right? Because the owner of the 250,000, $500,000 million dollar law firm, whatever, little firms, they’re not getting screwed over this way, because they’re doing most of this stuff themselves and their hands are on the levers.

Darren Wurz [00:43:11]:
Right.

Darren Wurz [00:43:11]:
They’re making those decisions.

Darren Wurz [00:43:13]:
Yeah.

Darren Wurz [00:43:14]:
Whereas at the higher level, this forces you to have those uncomfortable conversations with your team, the ones who are making those decisions, ones who are spending the dollars and enforce that fiscal discipline. I’m curious, how do you like, if you have that multimillion dollar law firm and you want to implement this system, where do you begin? What’s the first step?

RJon Robins [00:43:38]:
Well, you begin by reading the book profit first, and then you’ll want to read profit first for lawyers. So read profit first for lawyers first. Read my book first. And my book will tell you to read Mike’s book.

Darren Wurz [00:43:55]:
Okay.

RJon Robins [00:43:55]:
Which is actually profit first. But my book will get you ready to read profit first. My book will get you charged up. My book will get you, like, really in the right frame of mind to read profit first. Because I promise you, when you then tell your CFO and your controller and your bookkeeper and your accountant, and maybe your director of operations, and I’m talking to the multimillion dollar law firm owners here, when you tell them that you are going to implement profit first, when you ask them to read the book, they’re not going to be on board with it. They’re going to fight you on it. They’re going to. And if they don’t fight you on it to your face, they’re going to do something behind your back.

RJon Robins [00:44:44]:
I promise you they will. And it’s not because they’re bad people. And the answer isn’t, well, then fire them all, because you’re never going to get anyone who gets it, right, because they’re not. You’re the owner of the business. They’re not owners of the business.

Darren Wurz [00:44:57]:
Right.

RJon Robins [00:44:57]:
They might be more educated than you when it comes to financial stuff. They might be more sophisticated than you when it comes to financial stuff. They might be smarter than you when it comes to financial stuff. They might be more experienced than you when it comes to financial stuff. And if you’re smart, they should be. You should hire people who are smarter and better and more experienced than you at financial stuff than you are.

Darren Wurz [00:45:17]:
Yeah, right.

RJon Robins [00:45:20]:
But there’s a big difference between having the education and the experience and the technical training versus being the entrepreneur whose ass is on the line.

Darren Wurz [00:45:32]:
Right.

RJon Robins [00:39:11]:
They’re getting a salary and they might get a share of your profits, they might get bonuses, but most of their income, most of their family’s security is coming from the salary they draw from your business. As an entrepreneur It’s exactly the other way around for us. We live in a very different world than everyone who works for us. This is part of why my business, how to manage small law firm exists, is to create a community of entrepreneurs who we manage over 600 law firms. I don’t know if you know that.

Darren Wurz [00:46:05]:
Wow. Yeah.

RJon Robins [00:46:04]:
When you go to one of our live quarterly meetings, 400, 500 of our 600 members in the room, every single corner, this is like a very rare opportunity to be around a bunch of entrepreneurs who understand the world we live in, which is very different from the world of all of the really smart, wonderful, great people we employ. They don’t live in the same world we are in.

Darren Wurz [00:46:30]:
Yeah.

Darren Wurz [00:46:31]:
Yeah, that’s a different world. They’ve taken all the risk in that position, and you deserve to be compensated for that. There’s a reward for that risk.

RJon Robins [00:46:39]:
Well, forget about deserve. I mean, yes, you do deserve. I definitely. Look, I mean, I’m ein rand objectivism to my core here.

RJon Robins [00:46:29]:
Right? But deserve, let’s take deserve out of it. As a practical matter, your business needs you to be profitable. You have an ethical obligation to run a profitable law firm. I have long been advocating, and no one wants to do this, but I’ve long been advocating, that there should be a requirement in bar rules that before you’re allowed to own a law firm, you should demonstrate that you have the financial resources to run a profitable offer. I really believe that we owe an ethical obligation to our clients to run a profitable law firm. Think about.

RJon Robins [00:47:32]:
I really appreciate that you invited me to your podcast after you already knew me and knew what I was all about. We’ve got a bunch of clients in common. You got my unusual point of view.

RJon Robins [00:47:49]:
I built this business back in 2010, 1112 going around the country speaking to bar associations. I spent more nights on the road than at home speaking to bar associations. And I don’t get invited back to a lot of places. No, really, I don’t, because it’s not because I curse and yell and scream and all that stuff. I don’t get invited back because I speak about truths that most broke, struggling law firm owners find to be very uncomfortable. And since they’re usually the majority of the people in the audience at the bar associations, they vote me out. You know, they put bad things in the comment cards and things like that. And then the CLE directors don’t invite me back.

RJon Robins [00:47:28]:
Right. So, like, this is like one of my. My famous little routines that I have to speak my truth.

Darren Wurz [00:48:45]:
Yeah.

RJon Robins [00:48:45]:
But it doesn’t get me invited back man, I have permission to do this at the risk of not being invited back to your podcast because a bunch of broke ass fucking lawyers are gonna be like, I hate that guy.

Darren Wurz [00:48:55]:
Well, you know, sometimes we need that. That kick, you know, in the behind. Well, yeah, give us. Tell us. Tell us about it. Go ahead.

Darren Wurz [00:49:04]:
All right.

RJon Robins [00:49:04]:
I’m just gonna ask you a question.

Darren Wurz [00:49:05]:
Right. All right.

RJon Robins [00:49:11]:
There’s a legal term. There’s a legal. There’s a cause of action called fraud in the inducement. Fraud in the inducement is when you induce someone to enter into a contractual relationship by misrepresenting facts or by omitting material facts that, you know, a reasonable person, you know, reasonable inspection isn’t going to reveal.

Darren Wurz [00:49:33]:
Okay.

RJon Robins [00:49:33]:
Understand the concept of fraud in the inducement.

Darren Wurz [00:49:35]:
Yeah.

RJon Robins [00:49:36]:
Okay. The vast majority of small law firms in this country are engaged in a systematic scheme to fraudulently induce their clients to engage their law firms, which is obviously unethical and unprofessional.

RJon Robins [00:48:43]:
Right. And would subject someone to bar rule discipline, if you think about it the right way. So consider this. All things being equal, would you, Darren, prefer to hire a law firm that is being run by a lawyer who is worried about how they’re going to pay their mortgage next month, worried about how they’re going to make their car payment next month, worried about how they’re going to pay their kids tuition bill next month? Or all things being equal, would you rather be running. Hire a lawyer who is running a law firm where their mortgage is paid off, or they’ve got the mortgage prepaid for the next three months. Their tuition is prepaid at the beginning of the year, not on some freaking payment plan where the, you know, the lease for the car is running through the business, and they don’t even have to think about it because they know it’s getting paid for? Which lawyer would you rather have representing you?

Darren Wurz [00:51:02]:
Yeah, the second one. And I definitely see what you’re driving at here because. Go ahead.

RJon Robins [00:51:10]:
My case.

Darren Wurz [00:51:10]:
Okay. Yeah.

RJon Robins [00:51:12]:
All things being equal, would you rather be represented by a lawyer who has a written business plan for how each of the seven main parts of their law firm are supposed to run and has key performance indicators and metrics in place, and job descriptions and documented policies and procedures so that their law firm runs like a business and works for them?

Darren Wurz [00:51:35]:
Right. Right.

RJon Robins [00:51:36]:
Or would you rather be represented by a lawyer who is maybe even more brilliant than the other one, maybe even smarter than the other one, but has no written business plan, has no marketing plan, has no sales strategy, has no documented policies or systems or procedures for how anything’s supposed to get done, has no clear job descriptions for their staff, has no financial controls for their law firm, and they’re working their ass off just to keep things going. Which lawyer would you rather be represented by?

Darren Wurz [00:52:05]:
The one with the business plan, obviously.

Darren Wurz [00:52:08]:
Yeah. Right, right. Yeah.

RJon Robins [00:52:11]:
So last question here. All things being equal, would you rather be represented by a lawyer who has a budget, cash flow projections, a bookkeeper who doesn’t suck, who actually gives them proper financials, a controller who sits down with them every month and says, let’s go through these financials so you understand what you’re looking at, someone who has a financial roadmap in front of them. Or would you rather be represented by maybe even a smarter lawyer who went to even a better law school, who’s even a more brilliant lawyer, but their financial life is just chaotic.

Darren Wurz [00:52:57]:
Yeah.

RJon Robins [00:52:58]:
Who would you rather be represented by?

Darren Wurz [00:53:01]:
The more successful one you described?

Darren Wurz [00:53:03]:
Yeah.

RJon Robins [00:53:04]:
Why? As a practical matter, like, for real, why?

Darren Wurz [00:53:07]:
Because there are concerns, right. There’s ethical concerns.

Darren Wurz [00:53:12]:
Right.

Darren Wurz [00:53:12]:
The one who’s struggling, is the business going to be around to serve my needs?

Darren Wurz [00:53:16]:
Right.

Darren Wurz [00:53:17]:
Am I going to be even taken care of as a client? Because.

RJon Robins [00:53:21]:
Because you know where their mind is at.

Darren Wurz [00:53:23]:
Right.

Darren Wurz [00:53:23]:
And then it’s. It’s ethically, are they going to take my money and run because they’re struggling so much, they just need the money.

RJon Robins [00:53:28]:
To pay rental out of it? Let’s just leave ethical out of it and say that they’re both, you know, saints.

Darren Wurz [00:53:35]:
Okay?

RJon Robins [00:53:35]:
But you know that the person who’s struggling financially, the person who’s working crazy hours and having fights at home with their family because their business is ruining their life, they’re sitting there in your deposition and their mind is somewhere else.

Darren Wurz [00:53:49]:
Exactly.

RJon Robins [00:53:50]:
They’re sitting there in that hearing, and they’re getting distracted by things. The night when my son was being delivered, being born, we went to the, you know, I talked to the doctor who was delivering him, and I said, what are you planning to do the night before? Because we had delivery. We had a scheduled delivery at 830 in the morning on September 1, 2015. That was his birthday and time. And we met the doctor. I said, what are you planning to do the night before? And he said, that’s strange. No one’s ever asked me that before. And I said, well, you’re going to be delivering my son into the world, and I want to know what frame of mind you’re going to be in.

RJon Robins [00:54:29]:
And he said, huh? And I said, I want you to promise me that you’re going to take your wife out for a nice dinner and do something you really enjoy doing. I don’t want you scrubbing your fucking toilets the day before you deliver my son. I don’t want you running errands the day before you deliver my son. I don’t want you having a fight with your family because you’re never there for them. The day before you deliver my son.

Darren Wurz [00:54:55]:
Right.

RJon Robins [00:54:56]:
You know that you’re expecting your lawyer to show up in the best state of mind, and they can’t do that if their business is messing up their life, right? So anyway, my little Cle talk is that, you know, part of it. I take them through this little thing, and the lawyers, they start seeing where this thing is going and they start getting more and more anxious, but they can’t deny reality. And I say, so what do you think would happen if the client is sitting there in the sales meeting, in the consultation, and they’re about to sign the engagement agreement? You say, hold on a second. Before you sign this engagement agreement, I need to make some disclosures. You should know that I don’t have any financial controls over how this place runs. You should know I don’t have a budget that maps out how this place will stay in business for the next six to twelve months. I don’t have any job. I think you should know this.

Darren Wurz [00:55:55]:
Yeah. Yeah.

RJon Robins [00:55:56]:
And you know that all of the clients would say, well, in that case, I’m not going to hire you.

Darren Wurz [00:56:00]:
Right? That’d be a game changer.

RJon Robins [00:56:03]:
You know what that makes that piece of information? It makes it material. That makes it a material fact, right?

Darren Wurz [00:56:12]:
Yeah.

RJon Robins [00:56:13]:
Are you going to invite me on your podcast or not? Invite me on your podcast whether I wear a white shirt or a black shirt or. You don’t care.

Darren Wurz [00:56:19]:
Don’t really care.

RJon Robins [00:56:20]:
It’s not a material fact. Not material.

Darren Wurz [00:56:23]:
Right.

RJon Robins [00:56:24]:
But if it will change the person’s decision about whether or not to do business with you.

Darren Wurz [00:56:30]:
Yeah.

RJon Robins [00:56:31]:
That makes it a material fact. And the lawyers, and the majority of lawyers in this country are running financially struggling law firms. And that’s true. And they’re failing to disclose this material fact to their prospective new clients and they’re allowing their prospective new clients to engage them in a legally binding contract by failing to disclose a fact or a series of facts that are material. That’s called fraud in the inducement. This is serious stuff. So this isn’t just like feel good profit first for lawyers? Isn’t this nice? Because we all need to drive nice cars and live in beautiful homes and take great vacations. We have an ethical obligation to run our business profitably because our clients expected of us.

Darren Wurz [00:57:16]:
Yeah, yeah.

Darren Wurz [00:57:18]:
I appreciate that very much because I have gotten pushback from folks that think that the whole idea of trying to maximize profitability in a law firm is. Is, you know, unethical by itself because it should be a nobler pursuit. But actually, you are correct.

RJon Robins [00:57:35]:
Exactly.

Darren Wurz [00:57:35]:
You need to take care of yourself.

Darren Wurz [00:57:37]:
Yeah, definitely.

RJon Robins [00:57:39]:
Clients are depending on you to show up as the best version of yourself.

Darren Wurz [00:57:45]:
Yeah, yeah.

RJon Robins [00:57:46]:
And if you’re not the one practicing law anymore on the front lines because you’ve got a bunch of lawyers working for you, that’s great. Your employees are showing. Are expecting you to show up as the best version of yourself.

RJon Robins [00:51:00]:
Right? And the best version of yourself as the entrepreneur leading the law firm is going to. Is going to make decisions about how the law firm delivers services to its clients. And you should therefore also take an active interest, I think, in the financial success of the lawyers you have working for you. I want everyone who works for me. I have 100 full time employees. Um, and I take an active interest. I want each and every one of them to be financially comfortable because I want them to show up as the best version of themselves. I don’t want them showing up to work worrying about how they’re going to pay their rent.

Darren Wurz [00:58:37]:
Yeah. Yeah, that’s true.

Darren Wurz [00:58:40]:
Great stuff, Arjun. Well, unfortunately, we’re out of our time here, but I understand you have a great resource pack to give to our listeners. And the link is going to be in the show notes. Can you quickly tell us a little bit about that as we close?

RJon Robins [00:58:53]:
Yes, but first, I’m going to give them a plug for you and say.

Darren Wurz [00:58:56]:
All right, well, for real?

RJon Robins [00:58:57]:
Like, every lawyer should engage in real financial planning.

Darren Wurz [00:59:02]:
Yeah. Right.

RJon Robins [00:59:03]:
And not only should you engage in real financial planning for yourself, but if you really want to supercharge the performance of your team, help them get some financial planning in place for themselves, too. That will help you recruit better people, retain better people, motivate better people. So, you know, I don’t know, Darren, if you offer a service for owners of law firms and their staff, but I would be encouraging all of the law firm owners listening to the show to not only do a financial plan for yourself, but then you. Likewise for your staff. It’ll help you have more productive staff. All right.

Darren Wurz [00:59:40]:
Yes.

RJon Robins [00:59:41]:
Now, my own plug, as if I haven’t given enough already. Obviously, the first one is the book profit first for lawyers, available on Amazon. Second is profit first for lawyers podcast, which you can get on wherever you get podcasts. But my team also gave me a special bundle to share just with your audience. And you’ll put the link in the show notes?

Darren Wurz [01:00:04]:
Yes.

RJon Robins [01:00:05]:
So the show notes is where you get the link to the special proffers. First, for lawyers Bundle, which will include, one, an assessment you can do to determine whether or not and the degree to which your bookkeeper sucks. And it’s flushing your life down the toilet.

Darren Wurz [01:00:22]:
Right.

RJon Robins [01:00:23]:
Lots of lawyers are struggling financially. You’re having a lot of problems because your bookkeeper sucks and you don’t even know it. So we have a bookkeeper assessment that you can do to objectively measure and evaluate the performance of your bookkeeper. Two in the package is a financial literacy quiz. Third is something to help you figure out your labor cost ratio, which is if you don’t know what that is, if you know what that is, then you’re like, wow, this is great. If you don’t know what that is, then you really need to get the labor cost ratio worksheet. Third is a business plan workbook. And also in the bundle is finally a full set of sample financials.

RJon Robins [01:01:02]:
Like, this is what your financials that you’re getting from your bookkeeper should look like. And if they don’t, make them look that way.

Darren Wurz [01:01:10]:
All right, great stuff. Well, thanks for sharing that with our audience again. That’s going to be in the show notes. Click the link down there to get access to that. RJon, it’s been great having you on today. Thanks for coming on and sharing your wisdom and expertise and your energy. I love it. Great stuff.

RJon Robins [01:01:26]:
I appreciate you having me here and I appreciate you give me a platform to speak my truth.

Darren Wurz [00:58:36]:
Absolutely.