At the Crossroads
Around the world, many first-generation law firms have reached a pivotal juncture. Their founders—now in their fifties or early sixties—are beginning to contemplate retirement and the future of the practices they built.
For these firms, the question of succession is both personal and structural. Many are still organized as sole proprietorships or have minimal equity distribution among junior partners. In these cases, even trusted colleagues are often unable to afford a buyout at a price that reflects the firm's true value. Without a well-informed and realistic plan, a successful legacy can quickly dissolve once the founder steps away.
Option 1: Merging or joining another firm.
One viable path is to identify another firm with which to merge or integrate. This approach can ensure continuity for clients and staff while creating a realistic exit path for the founder. However, the process must be approached as both a business negotiation and a professional alignment. The founder’s challenge is to present their firm as an attractive acquisition—well-managed, financially stable, and strategically complementary to the prospective partner’s business model.
When “selling” the firm, objective evidence of consistent profitability, dependable client relationships, and sound governance will be more persuasive than personal reputation alone. The acquiring firm must also see the founder as an active participant in a seamless transition. Typically, a commitment to remain a partner for two to five years following a merger increases the transaction’s credibility, as well as its value to both parties. During this period, the founder’s leadership is critical in retaining clients, transferring institutional knowledge, and building trust within the combined partnership.
Option 2: Developing successor ownership internally.
An alternative—and for many, more appealing—strategy is to prepare future owners from within the firm. This often requires three to five years of sustained planning and disciplined execution. The central tasks are to identify potential successors, provide them with progressive leadership responsibilities, and ensure they develop the financial capacity to assume ownership.
Succession at this level is rarely achieved through title alone. It demands a deliberate effort to shift client relationships, strengthen managerial skills, and instill commercial discipline in the next generation. Structured mentoring, transparent financial reporting, and a consistent approach to equity valuation all form part of that preparation. By starting early, the founder retains flexibility to adjust payment structures, refine leadership roles, and ensure the firm’s culture remains intact while ownership gradually evolves.
Regardless of the option you want to pursue…
Three points are critical to keep in mind.
The most costly error is delay. Once a founder is within 18 to 24 months of retirement, options and opportunities can narrow sharply. Negotiations become reactive rather than strategic, and potential buyers or successors lose the time necessary to consolidate client relationships and financial arrangements.
Every firm’s situation is unique. The right succession model depends on market conditions, client expectations, and the personal and professional aspirations of the founder. There is no universal formula.
Whether you select the sale of your practice or a merger — or some type of hybrid of the two — one thing remains constant: the need to continue strengthening the firm’s market reputation, financial performance, and client loyalty throughout the transition period. These are the assets that sustain both negotiating leverage and long-term value. For founders standing at the crossroads, the wisest choice is to begin the journey now—while time is still an ally.
Walker Clark LLC can help you explore these options, create and test the scenarios, and help you understand at the outset what will be required to achieve economic justice for you, as a founder, and sustainability for your firm and the partners who will take it forward. For more information, contact us via the secure e-mail link at the bottom of this page to schedule an initial, complimentary consultation.