Anything Under the Sun Made By Man: The First Year

I started my own patent firm a year ago and have devoted a few minutes to thinking through the experience.

In summary, going out on my own has been one of the most rewarding experiences of my career, although I would not recommend it to everybody. It takes an iron clad stomach and some deep pockets at times, but it has been worth the effort for me.

The best part about working for myself is that I have the opportunity to take everything I have seen done well and poorly, and make some changes to my liking.

At the outset, I was determined to have a very long term view of almost everything I did. I honestly believe that what goes around comes around and that doing the Right Thing is the only way to do business. Taking the long term view, if I run the business with integrity and honesty, I will wind up dealing with people who have integrity and honesty. I had dealt with dishonest bosses, coworkers, and clients over the years and they are just not worth the anguish and heartache to deal with them. I would much rather make an honest nickel and sleep soundly at night than make ten bucks and not be comfortable with myself.

When I consider taking on some work, my policy has always been to be willing to walk away from any job and any client. There is no better negotiating position than being able to walk away. At previous places of employment, I have felt the unending pressure to perform, make the number of hours, or keep your job by landing a project. This leads to terrible behavior in a number of ways, not the least of which is underbidding some work in an initial deal that sets the tone for the lifetime of the engagement with the client.

I have underbid projects on a number of occasions, mostly before I started my own firm, and it hurts on two different fronts. From my perspective, I brought in work that is difficult to perform well and still make the financial targets. This can lead to bad decision making on the part of the service provider. From the client’s perspective, they don’t value the services as highly as they ought to. This leads to frequent changes to the project after it is started, phone calls that do not get answered, and other problems just handling the client.

For example, I once worked at a huge company where we sold our services for $250/hr, no matter if it was a high school educated line worker or a degreed engineer. Our clients hated changing the contract or asking for anything extra because we would charge them accordingly. Soon after, I was at a small consulting firm that was just scraping to get by. They would bid contracts for $60/hr for an engineer, and cut every estimate possible to deliver the lowest price. Consequently, their clients treated them awfully. The clients thought nothing of changing the project in midstream because it didn’t hurt to do so.

The lesson learned: don’t be afraid of charging money for your services. If you think less of your time, the client will, too.

Having this in mind, I try to strike a fair price for my services, but I do not flinch when I quote some work. I am not embarrassed about my prices, because I deliver value.

The key thing for solo practice, if there is only one key, is to live well within your means. There are good months and bad months. Some clients will pay up front, while others demand 90 days. Some months the work keeps coming in, while other months it is a barren wasteland. Being able to live a reasonable but not extravagant lifestyle (and having suitable cash reserves), the pressure to bring in work is not great enough to cause bad decisions.

Looking back on my first year as a solo practitioner, I have enjoyed it tremendously. I was able to arrange my full time law school schedule to take 5 classes on Tuesday and Thursday for two semesters and essentially devote Monday, Wednesday, and Friday (and sometimes weekends) to taking care of my patent clients. Admittedly, some weeks I have very little free time, but I have not yet been to the point where I have been overwhelmed. Just keep plugging away and remember to do the Right Thing.

Posted by krajec on April 17, 2005 09:36 PM to Anything Under the Sun Made By Man
Copyright 2005, Russell Krajec. All Rights Reserved.