I knew something was up the afternoon my boss walked into the office at 2:00 and asked, "Wanna go have a beer?" It turned out that he and I were both looking for new jobs: he because he and his partners no longer shared a common vision; me because his partners and I had never shared a common vision. Two minutes into the meeting over beer, he asked if I would leave the law firm to go with him to start a new one. Then he offered to make me an equal partner. I was 33 years old, had no clients of my own, had no business training, and had no background in running a business, my own or someone else’s.
I consulted with my dad’s elderly lawyer friend in Hugo, Oklahoma, who to this day laughs that there is nothing he knows more about than starting a law firm in Houston! However, he gave me great advice: "You’re young and you don’t have much money. If it doesn’t work out, you won’t have lost much and you can find another job." He was right on both counts. I closed my eyes and jumped off the precipice. I had become an entrepreneur without really planning to.
We started on a shoe string, including paying payroll the first two months with my credit card. I always say that we were the perfect professional partnership: he had clients; I had credit. In addition to practicing law, I spent the first two years manning the phones and learning to run the billing software. By the time we could afford a professional office manager, I almost understood the intricacies of business accounting, but can’t say that it was ever easy for me. Despite the cost, we hired an outside firm to handle payroll and taxes. We also hired a CPA as well as a business lawyer, on the theory that a lawyer who represents himself (or, in this case herself) has a fool for a client. It was months before we could take any money for ourselves and even then the amount was small. Nonetheless, the ability to control our destiny made the struggle worth it.
Fourteen years later, we have weathered everything from being replaced by a cheaper competitor to enduring legal reforms that have made us largely irrelevant to changes in the business climate that have resulted in a rollercoaster ride of economics—mostly toward the bottom loop of the roller. The worst day of my life was Monday, April 16, 2000, when our largest – essentially our only – client called to inform us they had gone bankrupt, owing us months and months of outstanding invoices. After going to the courthouse to tell the judge that I was no longer going to be a participant in the ongoing trial, I came back to the office where we informed our lawyers and support staff that we were going to have to lay all of them off because we did not have any work for them to do, nor hope of getting any quickly. The rent was paid for the month and the computers were available, so they could stay until we were kicked out, but we couldn’t afford to pay them. I made it through the speech without breaking down, then went to my office for a nice, deep sobbing cry before getting on the phone and trying to find new jobs for my now ex-employees.
Fortunately for me, a new client called that same day and we landed an interview for something new before I could get all my people placed. The new people came to interview us the following Wednesday, when we had only five actual employees. But we had called each of our former employees and asked if they would be willing to come and sit at their desks for the day. We would pay them for their time if we got hired, but couldn’t afford to if we didn’t. I have never been so gratified as that day: all but two of them (who had already started at new jobs) came for the presentation. One of those who came took a day off from her other job to come sit at her desk. The presentation went well, the client loved our employees, we got hired, we paid all those who came for dress rehearsal, and both life and business moved on. The bankrupt client is still in bankruptcy almost ten years later. We are still owed a fortune that we may never get, but the experience made us resilient and determined. We have weathered other events; fortunately, none that catastrophic. But the experience taught us to not put all our work with one client, no matter how insistent the client might be.
Over time, we added people and partners, many of them women. As a result, a few years ago, the firm became certified as a women-owned business. That certification has given us an opportunity and a platform for encouraging other women to take the plunge and jump into business themselves. I participate in many seminars and activities around the country, focusing strongly on the need for women lawyers to develop businesses of their own. I have spoken to a variety of audiences, not just lawyers, on the necessity of being able to support your own business without having to rely on someone else.
All these years later, my original male partner and I are still business partners and we have weathered many, many storms. We have offices in both Texas and Maryland. Our firm has a national reputation and a book of clients based not just around the country, but around the world. We continue to face difficult market circumstances and to work through them. Our firm has had as many as 125 employees and as few as five. No phase of business has been easy, but each has been educational in its own way.
The biggest difference between when we started and now is that now I also have clients and we both have credit. I would jump off the precipice again in a heartbeat, even knowing what I did not know then. I really believe that hard work, focus, and determination make a difference. If I could return to the past and change something, I would take a few business classes in college and be more strategic in my business plan, but the business has worked out pretty well despite those deficiencies, so I am not sure that I would change much.
Sharla J. Frost
KEY SUCCESS FACTORS: Perseverance, Determination, Work Ethic, and Focus
RECOMMENDED BOOKS: Brand You by Tom Peters, Freakonomics by Steven D. Levitt, TheTipping Point by Malcolm Gladwell