Josh Watts: [00:00:00] sometimes, you know, just the necessity of the situation forces you to make a big leap. I saw this as almost a one-off opportunity to start a business and to be part of growing it for myself. I started out and did four or five years in one of the large firms here which was fantastic. You actually don’t need that many clients or that many successes to make a real go of it. You’ve only got one client. And, you know, how risky is that? if I told you I was starting up a law firm and I was only gonna have one client, you go, that’s crazy, man.
Welcome to the Founding Partner Podcast. Join your host, Jonathan Hawkins, as we explore the fascinating stories of successful law firm founders. We’ll uncover their beginnings, triumph over challenges, and practice growth. Whether you aspire to launch your own firm, have an entrepreneurial spirit, or are just curious about the legal business, you’re in the right place.
Let’s dive in.
Jonathan Hawkins: Welcome to [00:01:00] Founding Partner podcast. I’m your host, Jonathan Hawkins. You know, the good thing about having a fairly young podcast is you get to have a lot of firsts, and today is another first for me in this podcast. It’s our first guest Australia, so, excited about this one. So, we’ve got Josh Watts all the way from Australia, and it’s early in the morning there and the afternoon here.
So we, we made it work. But Josh, thanks for coming on, man. So, we got a lot to talk about, but why don’t you introduce yourself. Tell us, I think you’re in Sydney, and tell us about a little bit about your firm and what you guys do, and then we will dive in.
Josh Watts: Yeah. Awesome. Thanks Jonathan. Thanks for having us. Yeah, so my firm’s name is Run It by Legal. We’re a small boutique firm that focuses on commercial clients, all business to business clients. And we operate out of Sydney, Australia. So, uh, quite a ways away from where you guys are. But it’s amazing the, power of the internet.
And I’ve been listening to [00:02:00] your podcast for a little while now and really enjoyed them. So I thought I’d reach out and give it a different perspective because there’s a lot of overlap and similarity and, and the journey of sort of starting a firm and going through those, issues that, you know, everyone sort of goes through.
And then there’s probably a few differences as well. So I thought it might be interesting to, to the audience.
Jonathan Hawkins: Yeah. So, you know, let’s talk about your firm. So I know you started it in, you know, 2021 but before that you were not practicing law at all, were you? Let’s talk about what you were doing before you started
Josh Watts: Yeah, that’s right. I mean, this is one of these unusual things, I think sort of a bit of a point of difference for where my firm now sits because I spent a large portion of my career outside of law not actually practicing. I maintained my practicing certificate throughout, which was a, a very useful thing to do.
And maybe a tip for people who’ve moved out of practice. I’m not sure if it works the same way in the States, but maintaining those sort of CLE points or those training points and, keeping up your practicing certificate in the back drawer is [00:03:00] always a handy move and has come really good for me.
But I’ve spent. A large portion of time as a general manager at one of the large telcos here moved into commercial. my original practice was at big law. So I started out and did four or five years in one of the large firms here which was fantastic. Great training, and I know we, we talk about that often.
But realized that I really liked the business side of things and the way some of the big firms were going. Particularly around sort of around that 2000 time, they were really leaning into people being, becoming specialists and really specializing down narrow paths once you got sort of past senior associate level.
And for me, the lawyers that I’d worked with, the partners I’d worked with, the people I the most in the business were the lawyers that businesses just wanted to call. You know, they’re the ones that they trusted, they wanted as part of your business. And these guys have made their way up through a very different path.
They’d been generalist, really good generalist lawyers. And what the firms were offering was just not that path anymore. You [00:04:00] know, I, I saw it being becoming very narrow. I had those discussions with, with the partners that I liked, and they were like, yeah, you’re right. You know, this is not. what we did 10, 15 years ago is not what’s on offer anymore in the big firms.
So that drove me to moving to in-house council at our large telco provider Telstra here which is a significant, significant size telco. And I did in-house work there, working on their large business and government deals for quite a while. But I always wanted to move closer to the business.
So I moved out of a legal role there, started running, running their national contracts team and then moved into the commercial deal making side and spent a fair bit of time on the deal side, moved across to Canon which is, you know, the, big Japanese company. And started up some of their business divisions around managed print services and off and outsourcing.
So always complex, always complex contracting. Arrangements and deals. So I still, I was still involved [00:05:00] in that, in negotiating those deals and close to the contracts, but not doing legal work and not providing legal advice in that time. And it actually ended up with me taking over and being COO and running one of the companies that we bought there, which is an IT managed services business. And doing that for five years, which I really loved. Really loved growing a smaller business into a more mature one. and having success in that space. And really that probably set up my profile in the industry, in the IT and tech industry in Australia as well. which is what, when I, when I came out of that role, I had to think and, and think about am I looking for another executive role?
There are plenty of executives with legal experience in, in my experience. But there are very few lawyers with executive experience and business experience having run those sort of companies and been through the, the growth and the sales and understanding how customers and delivery works.
So for me it was like, let’s give this thing a shot. Let’s see if it really is a point of [00:06:00] difference. It’s funny how you, start these things out, you know, I did a bit of research. I, I looked around and thought, Hmm, are people actually niching into this market? Does this actually work? Can you make a living out of it? You know, I, I googled up who the firms were that were doing similar things, and I, I rang around, I rang a one of the founders in the, in the local area and who had similar experience but was sort of 10 years ahead, and I rang ’em and said, Hey, can I buy you coffee? can we talk and, you know, this is what I’m thinking of doing.
Can you make a living outta this? you know, he was encouraging and, and sort of proved that you could and so yeah, 2021 difficult time to launch a, a law firm with no, no book of clients.
Jonathan Hawkins: yeah, yeah. Well, let’s, let’s stop for a second. ’cause I wanna go back and ask a couple questions. so let’s talk about your big law experience. You know, I know what, big law is like here in the States. I’m curious if it’s similar down there. So, you know, here in the states you’re working your ass off.
I mean, it’s, you might, some people say it’s two or three jobs or two and a half jobs. I mean, you are working, working, working. Is it like that [00:07:00] down there or is it, is it a little better lifestyle? I know, I know down there you guys like to go to the beach and surf and hang out, so, uh.
Josh Watts: yeah, no, unfortunately. Well, definitely in my time anyway. It was definitely the same thing. It was definitely the hard graft. Look, some people went more into it than others to be sure. But I think it’s, in some ways it’s a bit of rite of passage in there in other ways. It, it is also character building.
I mean, I, I remember distinctly pushing back pretty hard after having worked to overnight shift and then being in the office, you know, since the day before when it got to about 10 o’clock that night saying, okay, that’s it. I’m going home to get some sleep and come back and being told, oh, that’s not, you know, that’s not good.
I’m like, hello? You weren’t there last night at three o’clock in the morning when I was negotiating this deal. So, so yeah, it, it’s it is still a bit like that. I think. There is still a lot of pressure, but. I guess there are other factors in the workplace now too that have come in particularly [00:08:00] post covid that have sort of broken some of those, those pressures and, and modes of operating.
Jonathan Hawkins: Yeah, it’s, you know, it might be good and bad. So, I mean, you know, the, the, with the iPhones and the, the blackberries and the emails, you’re always in contact and now, quote, work from home, you’re always on the clock,
Josh Watts: That’s right.
Jonathan Hawkins: Or at least theoretically. So, okay, so then you moved to in-house and you did that for a while.
So I’m, I’m real interested too, about how you know, moving from the legal role in-house. To an actual business role. and I’ve, I’ve worked in-house and I know plenty of others that have, and you know, it’s interesting talking, you know, my own experience and talking to others, you know, at a law firm, you’re a profit center as a lawyer and, and a company, you’re a cost, you’re an expense.
You know, they don’t really, like, they don’t treat legal necessarily as, as, as they do some of the other divisions. So I guess, what was your experience in legal, and then how were you able to transition out of that?
Josh Watts: [00:09:00] Yeah, good questions. And I do see that quite often. I must say my experience, there was a fairly strong presence of a legal team in Telstra when I moved in there and a fairly senior team that was quite embedded with the business. So, in some ways, although, you know, legal in-house, legal is always seen as a bit of a roadblock and can be seen as slowing things down.
There was a reasonable acceptance that the team was fairly savvy and fairly business focused in trying to get things done. So we did a lot of stuff in-house. We didn’t brief a lot. And we, we turned things around fairly quickly, which the business sort of engaged with. But there is always that tension.
And a lot of it, I think, came down through relationships. So really understanding those people that you are supporting and trying to sort of educate them on what the, what the benefit is for their deal, how, how you can make things quicker and easier and are a better alternative, even if it’s a better, worse alternative than having to do something different.
So I see it all the time exactly what you’re talking about. I see people in very difficult situations [00:10:00] and really thrown a lot of work and a lot of pressure without much support or thanks. And I do see that a lot in some in-house council roles. Luckily that’s not that, that wasn’t my experience, but yeah, I see.
I see it a lot. And then transitioning to businesses, you know, again, relationships.
Jonathan Hawkins: mm-hmm.
Josh Watts: it’s really developing those relationships with the people that are gonna help you and support you and sponsor your move into the business.
Jonathan Hawkins: So when you moved was it how do I say it? Was it like a lateral move or did you, because you probably worked up to a certain point on legal, on the legal department, did you have to then step back to move over to the business role, or was it sort of a, sort of a
Josh Watts: Uh, it, it was a lateral move. I guess I, I had to do a, get a bit of an audit on what I needed to update in my skillset to really move across to a senior role. So I, I deliberately saw that there was sort of a gap in managing large scale teams and people. So I deliberately took on opportunities on the legal side where I [00:11:00] could.
To get, improve that experience. So that, that enabled me to move across more laterally in the business into a role where I did have, you know, 60 people underneath me because it wasn’t going from, you know, no reports or no team management experience to jumping into that role. So that sort of an example of, of how I tried to move across laterally.
But it’s not, I mean, it’s not easy. It’s, it’s and it does take some time and planning and working with the right people.
Jonathan Hawkins: Okay, so you moved over to the business role and then you moved up, you moved across different businesses. You ended up in a COO role, which is at, it’s really cool. I mean, I love business and it, you know, I know there are some lawyers out there that, that would sound, you know, completely ideal move out of the law and just move into business.
Easier said than done. it is easier said than done. And so kudos to you to making it happen. So you did all that and then let’s, let’s move up to your firm now. So then in 2021, you [00:12:00] decide to start your firm. So, again, that was sort of, I think you were alluding to sort of in the wake of Covid a little bit.
So, you know, what was that like? You also mentioned you had no clients, so that had to be scary. I mean, did you, do you have kids? I mean, do you have family? You, you go from steady job to, alright, I’m doing my own thing and we’re in Covid and I don’t have any clients. Guys, this is gonna be great.
Josh Watts: yeah. Well, I guess I was, I was lucky enough at the point where, you know, some, sometimes, you know, just the necessity of the situation forces you to make a big leap. And I think I was in that lucky situation where I, you know, financially I’d come out reasonably well from my last role there.
You know, there had been money around through Covid for people to move on, which was good. And it gave me a little bit of time, so it wasn’t a sort of burning bridge. The market was. Really, you almost forced my hand in the sense that there were no, you know, new executive roles, new things in the market, [00:13:00] straight out of, coming out.
So it did give me some time to sit there and think, well, you know, I need to ride this one out if that’s the path I’m going down. But I’d always, I mean, I’d always helped other businesses grow and I’d always had in the back of my mind that I would like to be part of leading a business that I had a big stake in.
And I saw this as sort of almost a one-off opportunity to do it. I mean, the very, very distinct divergence of, paths that I could see in front of me. And, and one was, was really doubling down and going down that executive role, which would’ve, you know, which would’ve really narrowed me into more corporates.
For the rest of my career really, and, really I wouldn’t have had that opportunity. So I saw this as almost a one-off opportunity to start a business and to be part of growing it for myself. So I sort of jumped on it then in terms of having no clients. What I did have was a good network in the target area that I wanted to practice in, and the area where I thought I was gonna add the most value.
So I, I never sort of started a general practice law firm. I never, I [00:14:00] never wanted to do any type of law that came through the door. I really only wanted to do that transactional business to business contractual deal, set up, negotiation side of things and really being that. The in-house counsel for multiple clients.
And, and that’s really what, what framed it for me. And then when I looked at the, the contacts I had, that was, they were the type of clients that, you know, I needed to target. And, thankfully with a bit of graft, I, I reasonably quickly picked up a, a few clients to get going.
Jonathan Hawkins: so I want to go down that path, but before we do, I want to, I want to circle back to sort of Covid.
Josh Watts: Yeah.
Jonathan Hawkins: I’m curious. what was covid like down there? What with the lockdowns? You know, I remember hearing about New Zealand just locked everything down. I, I don’t recall. Or maybe I never knew what it was like in Australia. So maybe paint that picture
Josh Watts: sure. And in some ways, you know, I, I knew that question was gonna come up and I, and I, I feel like I’ve blocked part of it out in my mind [00:15:00] because it was so bad here. We, particularly in Victoria, the southern state the largest sort of southern state with Melbourne as the capital, they had massive lockdowns.
I mean, they were locked down for I think, yeah, at least six months of a year. Where, and, lockdown here. And we, we were locked down for two, in two different periods in one for almost three months. and lockdown here meant you really couldn’t leave your house. you could and you had to have a reason for leaving your house, and you’re allowed to leave one once a day for exercise.
And it had to be within a, I think it was a five kilometer radius of your house. And so you could be stopped and checked. You know, there was no interstate travel. There was, there were, it was a full lockdown. And it lasted for, you know, a, a long periods of time.
Jonathan Hawkins: so, if you had family that lived, you know, two states over,
Josh Watts: No. No
Jonathan Hawkins: you couldn’t go visit.
Josh Watts: And they, they closed the borders as well, right? So people who were out of the country really struggled to get back in. They had [00:16:00] some sort of repatriation flights where you’d have to fly in and go into quarantine for two weeks in uh, quarantine hotels before you could get back to your home. So it was a very uncertain time, but also, you know, just, you know, you couldn’t believe what was what happened unless you lived through it.
Jonathan Hawkins: that’s wild. You know, I’m here in, in Georgia and we had some lockdowns, but they opened it up fairly quickly compared to, you know, other parts of the states here. And so I, we were spoiled a little bit. It was still weird. No school, you know, that kind of stuff, or home. Whatever. So there’s some weird stuff, but, okay.
So that’s the backdrop there. It sounds like severe lockdowns. You, you’re, did you start your firm in the middle of the lockdowns or had they ended by the time you started?
Josh Watts: my firm about a month before one of our most serious lockdowns.
Jonathan Hawkins: Wow.
Josh Watts: And you know, you just,
Jonathan Hawkins: what was that like? Yeah, what was [00:17:00] that like?
Josh Watts: well, you just, I think it’s one of those things, we all had a mindset. It was just, you just keep going. And you keep pushing. And without the technology that we had, you know, if, if that had, have happens five years before, you just would not have been able to run business the, the way business kept operating.
I think we’re very, very lucky with the timing. That meant that we could have these interactions because it, there is no substitute for sort of seeing somebody and connecting. And I still think that the personal meeting is still really important. But there’s a lot you can do as, as you know, there is a lot you can do reaching out to people around the world now where you weren’t able to do it before.
So it was just, yeah, it wasn’t ideal. But it was about pushing through and I think businesses had the mentality as well that this was the way it was gonna operate. There was a bit more trust given, to take on new people. Luckily I’d met most of the clients before in different, you know, in different roles.
So we had that personal relationship [00:18:00] and then it was a bit, you know, you still needed to prove and sell and make the sale and move ahead with all online.
Jonathan Hawkins: So, yeah, that’s really interesting. You’re, you’re in the middle, luckily you had these business connections and, I’m sure they’re very valuable connections and you had the business experience so you can sort of speak the business language, probably gives your potential clients a lot of comfort.
They’re sort of talking away to their own. So take me through you, you started reaching out to your connections and, and you started landing some clients in the middle of this COVID stuff, and I guess that has gained some steam. And, so your firms. Up running now. Tell me about sort of the structure of your firm.
Is it, is it just you, do you have help?
Josh Watts: Yeah. So
Jonathan Hawkins: all virtual?
Josh Watts: yeah, I’ve moved, I’ve been through a few iterations and I, I guess I could talk to those, but where I, where I’ve landed now is working with experienced lawyers that are either solo practitioners or have their own small firms. And I’ve sort of sought out [00:19:00] people with the right to mentality, background, experience to provide the same sort of service that I’m providing to my clients.
So, I’ve got a, a network of them. There’s, there’s three or four lawyers in that network that I’m currently briefing work to and bringing in under my banner under the run up by legal banner to clients. So I’m doing it that way rather than hiring full-time resource. I went to, I’ve been to market a couple of times to hire.
Well, I did have, I’d probably talk about the experience with juniors. So I have hired juniors and had junior lawyers on. Unfortunately for the type of work that I do, I found that it was counterproductive in the sense that there are very few things that are the same and very few repeatable.
Processes in the work that I do. Yeah, you’re reviewing contracts all day and the same issues come up, but your ability to spot them, you know, they’re sitting differently in every different deal and every different contract and, and everyone’s got a, a nuance in terms of what they want. So it’s, I I [00:20:00] was finding it was very difficult to give a junior sort of a first pass of a contract, you know, and they, and they’re difficult contracts, you know, 80, a hundred page contracts, they’re complex things going on.
For me, I look at them and it’s just like, I read, I read them every day, but for a junior person, that’s, understandably, that’s difficult. Takes a lot of time and then you get it. And, and I’ve gotta read the contract line by line anyway. So the time that it was saving versus the time to build juniors up and to work through that just wasn’t cost effective at the scale that I’m working on.
So either and there was no reflection on the juniors either ’cause they were great. But I really moved to a model of, of what I need in the business is people to do my work so that I can then focus on the business, focus on the clients, and, continue to grow and, and also do those pieces of work that I really need to do.
So that’s, that’s sort of where I’ve got to, when I went to market to hire employees in that, in that senior space for the type of work that I’m doing, I found that the people that had gone out or set up their own thing or [00:21:00] come out of something else, probably had a better fit and mentality than people who wanted to be an employee.
you know, into substitute a, a previous employment role. And it was just funny. I never sort of predicted that. But the people I came across who I thought, yes, you’re a good fit, you’re a good fit for my clients, tended to be ones who had started off their, their thing on the side or set something else up and wanted some flexibility and or some ownership.
I was like, yeah, I, I understand. I understand that’s why it fits. So I’ve sort of created this model. There are others in the market that are doing it. I’m not sure if it’s a, a big thing in the States, but I know there was a large firm in the UK that did this model with consulting principles.
It’s key point. they actually floated in the uk. So they’re on the exchange there. And they’ve got a similar company down here, and there are, there are a few others as well. So, taking advantage of, the incorporated legal practices that we now have.
Jonathan Hawkins: Okay, so lemme make sure I understand this. So you’ve got, you and your firm, and then you, you have found other attorneys that you sort of contract [00:22:00] with to, to do all, basically do all your work. How do, how do you find those attorneys?
Josh Watts: Yeah, good question. I guess it’s just being in part of networks where you think you’re gonna come across these people. I’m not a huge, I’m probably the biggest social media channel or media channel for me, given the type of work I do is LinkedIn. So that’s where I would, you know, I spend most of my time and profile.
So I do come across people and have people reach out through that channel. You know, I’ve got a fairly large network of people and friends of friends who I, you know, I can see worked in different, different places. Sometimes those, those larger in-house teams like, like the Telstra in-house team really I’ve, I’ve got a great network of people that I used to work with there that have.
That some that I do work for and others that have gone through the training of that sort of ground and have come out as, as really good lawyers to deal with. So it’s, but it’s, it’s never easy. It’s, there’s never enough hold out an ad, anybody interested? Please get in touch because it’s uh, you know, it’s always the challenge.
You, [00:23:00] you’re either you know, you’re either trying to find more clients or you’re trying to find more people to help do
Jonathan Hawkins: You know, that is, yeah. That, you know, that is one of the challenges of con I’ll call ’em contract attorneys. So, do, well, lemme back, lemme back up. Are they only working for you or do they have their own gig also? So they’re doing some for you and then some for themselves.
Josh Watts: That at the moment they’re doing some for themselves as well. Yeah.
Jonathan Hawkins: And it’s just, you know, I have found, and I, I’ve used contract attorneys, but, you know, sometimes it’s, there’s only so much time they can give. And you have so much work. You’re like, like you just said, you need more of them. You know, like, all right, lemme find some more. And you know, I think it’s a.
It’s a challenge here. I’m sure it’s a challenge there is, is finding enough good people to to, to
Josh Watts: absolutely. I know. And, and it’s across the board as well. I, I’m in some scaling groups with a lot of lawyers from the family law side. And they just seem to be completely flat out and cannot find resources. I mean, it’s, it’s sort of [00:24:00] ironic because there are more lawyers in Australia probably than anywhere else per capita.
I think we’ve got over 90,000 lawyers. I remember even, back when I was at law school, they used to say, you know, Australia’s got more lawyers per capita than anywhere except California. And in the last, last 10 years that that number’s doubled by over 50%. So, you know, I’m sure we, we, we’ve probably got more than anyone, but the, it, it is just not coming through in terms of the supply and demand and getting, you know, the right lawyers to do the work.
Jonathan Hawkins: That’s interesting. So I read an article, I don’t know what was a tweet, really? Tweet thread yesterday or day before, talking about in the US the, law firm applications are starting to go up and they’re pointing to it as a a recession indicator, because the last time that happened, it was like the recession was coming ’cause people didn’t have jobs.
They’re like, screw it, I’ll go to law school. but yeah. It’s interesting. I mean, you’ve got a, it sounds like a pretty sophisticated practice. You need people that have [00:25:00] experience, so they’ve gotta have been out there and done it. And those probably, they’re probably hard to find, I would
Josh Watts: Yeah. Yeah, yeah. They are. but it’s, you know, I think it’s one of those things too that you, you only need so much to be successful. And what success is for one lawyer or one founder is, is gonna be different to somebody else. You know, I’m, I’m driven to, to make this something, you know, reasonably substantial and do have those sort of, those larger goals.
But it actually doesn’t take much. And I think it’s difficult when you come out of a paid and employed role for a long time. It’s, and, and particularly if you don’t have role models or other people that have done it, it’s hard to see how, you know, you get to the level of a salary or, or any sort of safety net.
And I think that’s one of the hardest things for people coming out of it. But you actually, depending on the type of law you do, you actually don’t need that many clients or that many successes to make a real go of it. I remember going out we again, particularly people saying to me when I went out and, and set this thing up, you [00:26:00] know, it was obviously seen as a, a much riskier thing than being a, an executive in a corporate.
And people were saying to me, gosh, you know, how do you, how are you gonna set up this business? You, you relying you know, only a few clients? And like my response to that is, as an employee, you’ve only got one client. And, you know, how risky is that? if I told you I was starting up a law firm and I was only gonna have one client, you go, that’s crazy, man.
You gotta, you’ve gotta spread your risk. And I think with less and less loyalty in employed roles, you uh, yeah. You, you need to be careful that you, you realize that you, you actually only have one client. And yeah. you need to think about that. ’cause I’ve seen a lot of people get burned.
Jonathan Hawkins: That is so true. I mean, I’ve thought about it in the sense of you know, a lot of big firm lawyers will say, oh, I, I can’t leave. It’s, too secure where I am. It’s too risky to leave. and sometimes it’s too risky to stay because you, may be at the mercy of your firm, but I’ve never even thought about it in terms of being an employee of a company.
It’s like that, it could [00:27:00] really be risky. And at least if you start your own thing, like you say, you can, you can spread your, your risk out amongst lots of different clients. And if you keep your overhead low you know, it doesn’t take all that much. I mean, you gotta have some clients, but it doesn’t take all that much to make a go of it, which I’m sure you, you found out fairly quickly.
Josh Watts: Yeah, yeah. Absolutely. And, and it is an all smooth sailing. I don’t wanna, I don’t wanna give the impression that, you know, four years has just been a tr trajectory. It absolutely hasn’t been. And, and you know, I know we, we were talking before about some of the, sort of the traps and the things that you can get some of the mistakes you might have made along the way.
And for me, one of the biggest, biggest mistakes was getting too comfortable. I, you know, I was surprised at going okay, early on. Got myself a really good retainer and some, and a few good clients. Substituted a salary, reasonable salary and then took my foot off the pedal and I’m pretty, you know, you work with a lot of founders, you probably see this.
[00:28:00] And got a bit complacent with where I was going and, and started, I guess, started to default into more of an employee role you know, mode where you just, you do what comes across your desk, get stuff done, get paid and forget that you, you know, you are running a business, you are trying to substitute work coming in.
You do need to grow. And all of those seeds that you plant in the marketing and the networking in these businesses take time to grow and come off. So you need to do that work 6 months, 12 months out to see the fruition of it down the track. So that was definitely complacency was definitely an issue.
For me in that period and, and I guess born by a little bit of success, right? I’m sure I would’ve scrapped harder if I hadn’t have done okay early on. So, you know, that was really a, a plateau and, and I look back on that as a, probably a wasted year or two in the journey. But then, you know, everything else, it’s hard to go back.
You can’t go backwards, right? You, you just gotta say, you, you are where you are. But for people listening, [00:29:00] if, they start to feel like they’ve got that they’re too comfortable, it might be uh, the sooner you get onto that, the better because stuff takes time.
Jonathan Hawkins: I think that’s a really good point and you know, you almost have to go through it. To learn the lesson. And it’s funny, you can hear it, you’re like, I hear it, but you almost have to go through it to go through it and really embed the lesson. But the other thing is, you know, a good healthy dose of fear.
I think y’all need it. And, you know, you don’t wanna be overcome by fear. It can, it can be too big, but you need a little bit, you need something to drive you or else, you know, you sort of fall into that trap you mentioned. But so before we got on, you mentioned you, you operate under an incorporated legal practice.
Maybe explain what that is. I, I’m not sure what that means.
Josh Watts: It may actually be quite similar to the States, but so previously in Australia, you, it being a, any sort of firm revolved around individuals. So, you in your individual capacity, either as an individual or as a partnership of [00:30:00] individuals, so there was no, there was no incorporation, there was no company that could be the legal practice.
There was no corporate vale and there was no protection as a, as an entity. That changed in 2001 in New South Wales and then some other states followed as well where you could actually incorporate as a company. There are restrictions on it though, so you still need to, there still needs to be an Australian solicitor that’s a director of the company and responsible, like effectively the responsible person for the entity in the eyes of the law society and the to allow you to continue to practice to get the practicing certificate for the.
Company. So I’ve taken that path of being incorporated, which allows you to have those corporate structures as well. It allows, you know, a company to own the ip you know, trademarks a company to employ people as opposed to, and what, what most people will do here in Australia is [00:31:00] have a sole practice where you don’t need to be incorporated.
You, you run that as a sole practitioner. You can still employ people under that model, but you just don’t have the protection of the corporate entity. Yeah. So it’s, it’s reasonably, it’s reasonably new. It’s, you know, I say 2001 doesn’t sound new, but it hasn’t had a huge take up yet, but I think we’re gonna see a lot more of it.
Jonathan Hawkins: So you, you have a company, you have to have a, a lawyer or solicitor, be responsible for it. Can you have non-lawyers also be owners in that company?
Josh Watts: you can you can. And you can there. Yeah. Yeah. They’re also multidisciplinary, so it is possible too to run non-legal divisions or work out of that entity as well.
Jonathan Hawkins: okay. So that’s cool. So, that is sort of starting to happen in the States. So in DC they’ve, they’ve allowed a version of that for, for a good number of years, but Arizona, I don’t know if you hear about it down there, but Arizona has. Opened it up, [00:32:00] sort of like what you just described. So you have a, you have to have a lawyer that’s licensed that’s responsible for it, but you can open it up to non-lawyers to own it and, you know, so that is sort of really picking up steam, which maybe leads me to a topic that I really wanted to make sure we covered.
And, you know, I’ve known that Australia along with maybe UK and others have publicly listed, publicly traded law firms. So here in the States right now, it’s the big deal, you know, are other states gonna allow non-lawyers to own a part of a law firm? Nowhere on the radar is, hey, we’re gonna list this on the stock exchange, which you guys have been doing for some period of time.
So I’m really interested in that. So what is that like down there? Is it I don’t know if you were, when it came about and were you really paying attention to it when it came about? Was there a big. Debate about it or you know, sort of take me through
Josh Watts: Yeah. I, it wasn’t as, as big a news as you [00:33:00] might think it would be. I mean, I, I, I’ll caveat that with, there’s some obvious there’s some obvious conflict issues. So the companies that have listed on the stock exchange here, there are a few, the largest two are personal injury firms and reasonable size, personal personal injury firms.
none of the top tier or large firms or general practice firms I’ve seen even entertain it. Largely because they make enough money as partnerships. I’m not sure that they, they wanna give up any equity. There’s usually more of a fight for people to try and get equity in those firms than to try and get more equity holders in.
But those firms, there was obviously some talk about it at the time when they launched and when they iPod into the market. And there was some debate obviously around the legal area around, you know, adding another conflict issue to the duties that the director has. You know, you obviously as a lawyer, your primary duty is to the court and to the justice system, and then next to your client [00:34:00] adding the layer of what your obligations to the shareholders are and to the public shareholders really just adds one more level of potential conflict that I can see in that.
Um, and tension in that. But we haven’t seen anything really come out of that and we haven’t really seen, you know, nothing’s blown up around that, where there’s a conflict between acting in the interest of the shareholders and acting interest of a client, for example. we haven’t seen that happen.
It’s really just been an operating model in the background. I’m sure within those firms. It’s. You know, I’m sure it’s changed the way things operate within those firms where people are given shit, you know, publicly traded shares, they’ll still all have the same restrictions, you know, in being able to trade their shares and and locking them up and locking them in.
So it won’t, won’t create the nirvana of liquidity that you might think it does for a partner. But yeah, I, we don’t, it, it really, it, this sort of happened and, and it’s died down and I don’t see, I don’t see a rush to the market to list anytime soon for any of the other firms.
Jonathan Hawkins: you mentioned [00:35:00] conflicts, and I, in my mind, I’m thinking, so you’ve got a, a big personal injury firm that is listed on a public exchange, and then you get a big insurance
Josh Watts: Yeah.
Jonathan Hawkins: that’s paying out all these personal injury claims and they say, oh, we’re gonna go buy up this firm. And so they’re on both sides of it.
Right. So that would be a, a weird, I don’t even know what you would do with that.
Josh Watts: Yeah. I mean, and, like, you know, in, in some ways that happens because the biggest investors in our market are the really the superannuation companies. So we have a large superannuation scheme here, which is sort of like a compulsory pension scheme. I’m not sure if you’re familiar with it, but it basically, there’s a percentage of everybody’s salary that goes every month, every pay into your super account.
And you can’t really touch it until you, until your pension age or 65. And so this massive pool of funds goes into these superannuation companies and then they invest that at your direction, but largely into the market. So they end up being massive players. And the superannuation companies also generally [00:36:00] provide the life insurance, death insurance the, the third party injury, lots of different types of insurance, income insurance.
So as you say, there is, I mean, these providers that are the frontline of insurance also do hold large stakes in these companies.
Jonathan Hawkins: Yeah. It’s just crazy.
Josh Watts: But you know, they, they’re always gonna win. So, they’re gonna, even if they lose, they, they’re winning through the, through the law firm.
Jonathan Hawkins: That’s right, that’s right. I mean, if you can do anything, own an insurance company, ask Warren Buffett. Right.
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Jonathan Hawkins: So yeah, so let’s go back to back to your firm. So, you mentioned it’s, the incorporated legal, so you can also offer sort of these multidisciplinary services, so non-legal services. So, is that anything you’re exploring with your firm?
Josh Watts: Yeah, it definitely is. I mean, my, [00:37:00] my view is always to to really niche down and understand the needs of, the target market that you’re in. So what I’m looking at is any ancillary service that would support that target, that target market. And for me, one of the things that, that I see a need for is the company secretary registered office services, incorporation services that sort of sometimes fall between legal and accounting.
And they’re not strictly legal services, but I can definitely see, you know, that’s, that’s an area that I’m, you, I’ve got a meeting later today to start to set that up. So, this is an area that I think will, we’ll move into because it’s an adjacency that supports the same clients, that means that they can stay within, you know, in-house within the firm and we can help them.
I’ve sort of done that a little bit with the legal services. I’ve, you know, recently moved much more into employment law for employers with the support of, other lawyers that are bringing in to help with that. So this is just a next [00:38:00] step to that, moving out to other things that sit alongside it and yeah, you’ve already got the relationship, you’ve got the trust.
It’s about then seeing what other services make sense in that relationship.
Jonathan Hawkins: And I’m, I would imagine those types of services, at least some of them are more apt to be able to be scaled, to be pushed down to less experienced people, maybe non-lawyers, all that. So it allows you to, to grow in a way that perhaps you can’t with lawyers. So,
Josh Watts: a good point. that’s a good point. It also gives you the ability to focus a little bit more on annuity revenue. So, which if you, you’re close to business, that’s what people like in terms of value of a business that, that allows you to sort of provide services that are ongoing and, you know, charged on a monthly or annual basis.
Jonathan Hawkins: So I want to get into sort of what you do for marketing, but before I do, I, I want to sort of do a side topic again, that’s not really law related, but it’s Australia related. It’s Australia related. You know, there’s I loosely fo I’ll follow some people in you know, [00:39:00] financial circles or whatever that so I, I, I’ve become aware of this.
This is not a big topic in the us No one talks about it, but I’m just sort of aware of it since I got you. I want to ask you about it. So the housing cost in Australia. I have heard are just insane, crazy bubble of all bubbles, just
Josh Watts: Yeah,
Jonathan Hawkins: crazy stuff going on down there. And I, I was just curious from somebody that’s down there in it, what’s your perspective?
Josh Watts: well, like Australians are house and housing market obsessed. Like it’s the number one, you know, you, if you go to a, a barbecue or bri whatever you, you know you’re gonna be, that’s the first thing people are gonna be talking about. The housing market, the housing prices, you know, that ranks way above politics or anything else in this country.
And because so many people are, are in the market, the market moves so strongly, there are lots of mortgages. So, everybody is focused on house prices and we’ve seen massive, massive growth in house prices, some supply and [00:40:00] demand issue. But also lots of foreign investment coming in as well.
So we have a lot of immigration or a lot of people buying up properties, particularly from Asia. As, as Asia started to boom. You know, the, the amount of money that’s come in has just, has been crazy. So, I mean, to, to give you an idea, in the seventies when my parents would’ve bought a house you were looking at a house of maybe two and a half times salary to buy a house.
Now you’re looking at 14 times,
Jonathan Hawkins: Dang.
Josh Watts: right? So, you know, the median house price here in, in Sydney is, is around like, it’s around one and half million. Dollars. And that’s, you know, that’s everywhere. So, now getting to the point where they’re calling it a housing crisis in the sense that the next generation’s ability to, to purchase a house, even a unit is really stretched.
And there are constraints on on building that uh, you know, we’re just not building enough new properties and have new space to, to build, to meet the demand. So, it’s in the news all the time. it’s talked about the, [00:41:00] obviously it’s where you sit on it, it does depend on whether you own a house or not.
So, there’s a lot of talk about how do we stop house prices increasing. But for most people, a house is their biggest asset and is the source of their biggest wealth. So you’ve got this, you’ve got this real tension down here. But yeah, it’s like the, the prices are crazy and I wouldn’t want to be um, entering the market now.
Jonathan Hawkins: You know, we, we have similar stuff going on here. It, it depends on the submarket for sure. You know, here, one of the problems here is there’s not a whole lot of inventory. And the prices are high and the interest rates are high. So people can’t afford, you know, it’s just the affordability’s an issue, but there’s not enough housing and they’re not building enough so that, that’s a similar issue.
And if they built a bunch, bring the prices down, I’m sure. So it’s a weird thing. So I was just interested since I got you, I wanted to hear so,
Josh Watts: well, don’t worry when you, when you come down here and you get off the plane, I’m sure the taxi driver to your hotel will start telling you about house prices.
Jonathan Hawkins: It [00:42:00] is not like that here. No one’s no really talking about it like down there, but that’s interesting. Alright, so let’s shift back to the law firm. So, so you’re marketing, so, what sorts of things do you do and what works for you down there for marketing? I, I know you, had a lot of connections from your business life and I’m sure that’s part of it, but you know, what sorts of thing, you mentioned LinkedIn too that works here.
But what’s your approach to marketing down there?
Josh Watts: Yeah. It really, again, I guess you’ve gotta start with identifying who your, who your real ideal client is and what market that you really serve and your niche. And not, not be too broad. I think this is a difficult thing I see with most people who start out they’re like, yeah, we do everything we can do your will, we can do your, you know, your m and a transaction. You know, we can do a licensing agreement. Great. But it makes your approach to the market really. Really scatter gun and you, you’re trying to appeal to everyone. for me it’s a little bit easier because I’ve really narrowed it down to, I’m only targeting companies, so I’m really only targeting founders and [00:43:00] executives of companies who are making a, a purchasing decision on legal and general councils who have overflow work in the areas that I’m an expert and, and we provide expertise.
So, that really narrows your target market down and then once, once you’ve done that, so that for me, that that understanding and that piece has to happen before you talk about any channel and any way you go to market. there’s no point in starting with Google Ads and then doing that piece of work.
You know, there’s, you need to really know who you’re targeting. And for business to business, I don’t I haven’t done a lot of testing in it, so, you know, I can’t say for sure, but I think those, those large scale advertising campaigns and even the semi targeted ones, I’m not a hundred percent sure that that’s gonna bring much.
And SEO I’m not sure that that is even a, a major thing unless you happen to be the one or top one or two in your space for business. For me it’s much more targeted. So it’s, lists out of LinkedIn or lists or, or using other list list platforms [00:44:00] to really narrow down and target who are these people individually that I’m looking for.
You know, there might be, there might be 25,000 companies that I’m a good fit for or we’re a good we’d be a good legal provider for. Right. And then that’s, so that’s a finite list. And then how do you work that down? Where do you target that list? How, how do you go, okay, well, of that list, who’s in the general location that we can get to easily, who can we, who can we meet?
Narrowing those lists down and then running a campaign. There are different, there’s different software that you can use to, to run these, help you run these campaigns, but ultimately you need to tailor them fairly tightly yourself. And that’s So I would, yeah.
Jonathan Hawkins: So you’ve got your list, you’ve got your tart list, and you, you mentioned the campaign. What, what does that look like? I mean, are you emailing them? Are you calling them, are you sending them letters? I mean,
Josh Watts: So yeah, I mean there are, there are some fairly strict rules here around any spam and I’m not sure what, what they’re like in the states as well. So you do have, there has to be some sort of [00:45:00] nexus and At least implicit consent to email campaigns. So you do need to be careful with those.
But, but where you do have direct consent or at least implied consent with opt-out rights you are able to do email campaigns. So I have tried those use those through software like Apollo and others. And where I’ve found the biggest success though, is multiple step processes through a LinkedIn campaign where you are you are got your target, you then effectively do the research on those people.
You’re going through, you’re looking at what they’re posting, you’re commenting, you know, a period of time later you make a connection. And then I, I’ve actually found what I, I personally hate when you click connect on someone and then a message comes straight up and say they’re trying to sell you something straight away.
So for.
Jonathan Hawkins: Oh yeah.
Josh Watts: Like, I try and avoid those popup messages. So I, I just let people connect and then I might leave it a month. You know, I’ll, I might like something they’ve done, but then I’ll have a pool of people that I’ve [00:46:00] connected with over a month, and then I’ll send out a, then I’ll do a sort of a three step.
I’ll come out to them and go, okay, you’ve got a sorry. You know, sorry, this month’s been crazy. I realize we connected. I’m not sure if you know what we do. This is what we do. What do you do? Where are like, do you wanna catch up? Yeah. You already know. Like, these are pre-qualified people, right? You know, that they would be 50 50 a good conversation for you to have in your business.
So it’s worth like putting it out there to go like, let’s meet for coffee. Where are you? Like, how can we help each other with business? How can we collaborate? And, and just sort of like a two or three step in that you’re only gonna get, you know, a conversion, a conversion rate out of that, of, of 5% or something.
is a good result. And if that in the type of work that I do where you become their trusted advisor for legal work, and this is not like a one-off, you know, deal, this could be a a thousand dollars piece of work, but it means that you are their go-to person for the next five years for everything that comes up in their business.
So it’s worth the time. It’s a very different [00:47:00] approach to market if you are, if you’re doing a conveyance or you are doing something where you’re, you know, you’re really churning and burning through a number of clients. So it’s very, that’s why I say you really need to understand who your market is first and what you offer, and then pick the right approach for it.
I see people sort of going, we need to do marketing now. And they get a list of what people do to market and, you know, some of them are just not relevant to the, to the type of, of work that you’re doing and the market that you’re doing. I think the way I approach things would be the wrong approach, where you’ve got lower value, multiple churn.
It’s, it’s way too intensive. To get the result that you need. So I think in that case, you know, the Google ads and those things are, do make sense?
Jonathan Hawkins: That’s interesting. You know, I, I’ve, in the past I’ve sort of talked about it, you know, to get clients you can hunt, which is sort of what what you do is hunting. You can fish, you can plant seeds. And then for your former clients, I, I call it mining. So your, mining, your old clients.
So you, you have more of a
Josh Watts: And I [00:48:00] guess, I mean, I guess I was just focusing on the hunting now, but I love the way you phrase that and the analogy, ’cause I think it’s perfect because you have to do all of those things
Jonathan Hawkins: Yeah.
Josh Watts: they deliver at different speeds and different value. So, you know, you’re, you are mining the existing customer base and, and clients.
I mean, that’s the, that’s both the, it’s the easiest. Market. It’s, and it’s one that we probably most often forget to do properly and relentlessly and be top of mind for those clients. So staying top of mind for, for those clients is really critical. And it’s one of the things I struggle with the most, and it and it’s one on my to-do list to make sure that we’re getting those newsletters out.
We’re, we’re being more top of mind with clients. It’s hard to do when you’re busy but you’ve just gotta do it if you, if you want to keep that momentum going. So that’s uh, I’ve got just taken on board a, a new paralegal who’s going to assist with that, which is great. And then there’s, there’s also the, the brand awareness and the business awareness piece and just being a trusted.
[00:49:00] Advisor or an expert in the market, which is you, very much what you are doing with this sort of podcast and, and forum. And it, it’s funny, I’ve heard you mention videos before too, and I, I had a similar issue for the last couple of years where I know that the way I consume content and meet, meet new people online is to, is to watch their 32nd two minute video.
Right? And I know it, and I’ve known it for years and every year on my marketing plan, I write there, you gotta get those videos done. You gotta get those videos done. You know, you’ve got the technology to do it, you can do it. Never did it. And so this year I was just so mad with myself. In January, I went to write rent to write it down again.
I went, no, this is ridiculous. I just picked up the phone that I looked on the, I looked on a website and said, I’m not gonna do this myself, so I’m gonna pay someone. To make this happen, to force me to do it. So, uh, that’s what I did. So I, I’ve recently just launched some videos. I hate videos of [00:50:00] myself, so, you’ve just gotta get over that, I think.
Jonathan Hawkins: yeah. Welcome to the club. Yeah. Well, you know, that’s the exact same thing. I, I’ve had that on my list forever and ever. I mean, I do these podcast videos, but finally I said, all right, I have to pay somebody because if I’m writing a check, I will do it. Then I will do it then,
Josh Watts: that’s
Jonathan Hawkins: so I am, I am talking to people right now.
I’m in the process of the last couple weeks,
Josh Watts: make it someone else’s deliverable and uh, it, it’ll start to happen.
Jonathan Hawkins: It’s coming. Well, cool. So I got a couple more questions before we wrap up. So, I’m curious also about the licensing down there. So, here in the States you know, each state has their own licensing body for the lawyers. And you have to have a license in those states to practice.
And once you take the bar exam there, some states it’s easy to sort of wave in if you check certain boxes, but you know, you, there’s not a, a countrywide license that you can just use everywhere. So I’m curious, in Australia, is it the same? Is it wherever you live, you can [00:51:00] practice all over the country?
Or is it state by state down there?
Josh Watts: Yeah, it, largely is that you can practice across the country. There are some exceptions and there are some exceptions by subject where some things are just really different. So, you know, like I, I wouldn’t be doing property law or something in, Queensland, there are just different regulations, different ways of doing things.
So people will stick to their states. You, some of the courts you need to ask for leave to appear but it’s regularly granted. But other than that, you can practice across, across different states. You can have clients in different, in the different jurisdictions. Yeah, so it’s, a, it is a little bit less strict than in the states.
Jonathan Hawkins: That’s cool. Okay, so another question. So your firm, you’ve got a, a trade name, run it by legal. is, are trade names common down there or is it, is it still traditional or We’re listing everybody’s name. What’s, what’s it
Josh Watts: Uh, Look, it’s still it’s still very traditional like most firms are still under people’s names or trade names. I [00:52:00] think it really depends on the market. I. For me you know, you, you’ll see, I guess a lot of smaller ones are starting to use other names and trade names as they’re coming through.
I think it’s a bit of a generational shift. So we’re seeing more and more people coming out with, you know, aspirational names rather than using their own name.
Jonathan Hawkins: That’s interesting. I’m always, these sorts of things interest me, but so we’ve been going a long time and I wanna be respectful, but I I wanna know this question I, like to ask folks is, you know, you’ve been at it for a little while now. You’ve been in business, now you’ve got your own business.
what’s your vision for your firm over the next 5 50, 10, 15 years?
Josh Watts: Yeah. I’m really at that scale point where I can see us. Growing and serving a lot more clients. I, I think the market is really there and really ripe for disruption in that mid-market growing company. I think we’re really offering something that isn’t offered by the larger firms and isn’t well serviced necessarily by individuals.
So I think we’re able to offer something different in the market. So I, I see no [00:53:00] reason why we can’t. Scale this up. the challenges are really finding the people. But I’m also saying that, you know, a lot of good people are leaving by choice or through redundancy out of larger firms. So I think there’s a massive opportunity for harnessing great lawyers between the age of sort of 45 and 60 who, or, older, who still wanna work and still want to contribute, but aren’t seen as, as valuable as they are in the organizations that they’re in.
I think there’s a lot of value there. A lot of people who, who we can tap into on both sides. So I think scale for the firm is the next thing I think offering, we talked about it before, offering other and ancillary services, and I’m spending a fair bit of time with an international lens as well.
So, I’ve joined a international group lawyers Europe International, who are now all around the world. They’ve, they’ve been going for, um. since the nineties. So I’m, I’m representing them in the Australian market. And doing more work with them, it’s, it’s a collaboration of over 800 lawyers worldwide that sort of work collaboratively together that are [00:54:00] outside of the big practice area.
And also doing, you know, doing more things internationally where I think there’s, there’s customers trying to get into the Australian market as well. I see a lot of opportunity there. So I think there’s a lot of, lot of upside and growth for the,
Jonathan Hawkins: Well, that’s, that’s cool. Josh, I, I appreciate coming on. This has been really interesting for me. I’ve learned a lot ’cause I mean, I know about Australia, but I don’t know much about it. So, so this has been fun for anybody out there that wants to get in touch with you. I don’t know how many people in Australia listening to this, but for anybody anywhere in the world that wants to get in touch with you, what’s the best way to find you?
Josh Watts: yeah, look, just I. LinkedIn is probably the best thing. So Josh Watts uh, run up by legal. You, you’ll be able to find me there. You know, you can easily set up a meeting or uh, reach out and connect on LinkedIn. That’d be great.
Jonathan Hawkins: Awesome. Well, this has been fun. If you’re ever in the States, ever in Atlanta, a lot of people fly into Atlanta, so, let me know, man. We’ll, we will grab a bite.
Josh Watts: know, the masters is definitely on the bucket list, so, uh, it, it’ll [00:55:00] happen.
Jonathan Hawkins: It’s coming up. It’s coming up. It’s almost here. Yeah. Yeah. It’s it’s pretty out there. It’s pretty, so yeah. You need, you need to make that so,
Josh Watts: absolutely.
Jonathan Hawkins: well cool. We’ll, appreciate it.
Josh Watts: Thanks Jonathan.
Thanks for listening to this episode of the founding partner podcast. Be sure to subscribe on Apple podcasts, Spotify, or wherever you get your podcasts to stay up to date on the latest episodes. You can also connect with Jonathan on LinkedIn and check out the show notes. With links to resources mentioned throughout our discussion by visiting www.
lawfirmgc. com. We’ll see you next time for more origin stories and insights from successful law firm founders.
