Leading private client lawyers are legal professionals who engage in wealth planning services, including estate and asset protection planning. Exit and succession planning, and cross-border and international tax and related planning. In addition, a core defining characteristic of leading private client lawyers is that they consistently earn US $1 million or more annually from their practices working with wealthy clients. This figure does not include sharing in the profits of the law firm or additional monies they receive for managerial responsibilities.
According to Angelo Robles, founder and CEO of Family Office Masterclass, “Single-family offices, more than ever before, are making extensive use of outsourcing. While this approach impacts all these various forms of expertise the single-family offices are coordinating on behalf of their wealthy families, it is particularly characteristic concerning their use of private client lawyers.
In a 239 single-family office senior executives survey, 80% extensively used external private client lawyers. The revenues generated by single-family offices tend to be very significant, which is why they want to work with them.
Individual engagements, such as an estate plan for the founding or a subsequent generation, are often quite elaborate and profitable. On top of this is that single-family offices will repeatedly engage the same private client lawyers, provided they do a good job. As the world of single-family offices is complex for leading private client lawyers, the result is a series of engagements and, very often, meaningful retainer arrangements.
Another potential source of revenue for private client lawyers is origination credit. Single-family offices commonly require a range of legal expertise. Private client lawyers are often in the position of referring other lawyers in their law firm. In the survey, more than 65% of the private client lawyers generated additional fees for their law firms by introducing different types of lawyers to their single-family office clients.
Two complications were cited by the surveyed private client lawyers in building a substantial practice with single-family offices. One complication is that single-family office professionals are likely to negotiate legal fees.
The wealthy, across the board, are increasingly critically evaluating the expertise and costs of the professionals they employ. Single-family offices are designed to do this. This need not be a concern. When the value professionals provide is clearly articulated, cost issues regularly disappear. For leading private client lawyers, this means not only doing an exceptional job but also ensuring they communicate the value they are delivering. Doing so usually involves distinctly explaining how their solutions closely match the self-interests of their wealthy clients.”
The other complication is sourcing single-family offices that would benefit from their legal expertise. “There are various ways high-quality professionals connect with single-family offices,” says Robles. “While all the different approaches can conceivably work, some prove exponentially more productive. The most effective way to connect with a single-family office is to be introduced by a professional currently working with that single-family office. Leading private client lawyers can take several systematic approaches to successfully and consistently be referred to single-family offices by other professionals.”
As the number of single-family offices continues to increase, the opportunities for leading private client lawyers correspondingly increase. Being technically proficient is a must. The most significant benefit for single-family office clients and private client lawyers is the ability of the private client lawyers to communicate the value they deliver.
Russ Alan Prince is the executive director of Private Wealth and a strategist for family offices and the ultra-wealthy. He has co-authored 70 books in the field, including Making Smart Decisions: How Ultra-Wealthy Families Get Superior Wealth Planning Results.