It is never too early to think about your own succession plan. I work with many small firm owners at various stages of their careers. Many small firm owners wait until they are on the cusp of retirement to think about succession. One way to prepare for succession is to groom your people or recruit people to mentor and develop so one day they will be in a position to buy you out. I am a big fan of this approach as it’s a win for you in your firm will have a higher value; a win for whoever is buying you out as they will have the chance to build relationships with the clients and staff; and a win for the clients as they will have confidence in the lawyer already.
I’ve seen many retiring lawyers over-value their firm and eventually end up just walking away from it altogether because they didn’t plan well enough in advance. You see if you wait too long, you’re only really selling good-will, your client list. There is no guarantee that the firm clients will stay on with a new lawyer they have no relationship with. So either groom your people from within, or bring someone on about three years before you intend on retiring with the intention that they will buy you out. In two cases I know the seller of the firm and the buyer of the firm worked together for at least two years before the selling lawyer retired. This gave the buying lawyer time to build relationships with clients and staff.
I have two clients who are only half-way through the process of buying into a firm, and they are already thinking ahead to retirement. They are already thinking about succession planning. And this has affected their approach to recruitment. It’s never too early to think the end game.