In the report
Industry benchmark data
See how your firm stacks up against the competition in billables, collections, and hourly rates.
Understanding lockup
Shorten the time between work performed and payment received by leveraging our “lockup” metric.
Getting paid faster
Understand how client preferences and key technologies impact how quickly solo and small firms bill and receive payment.
The rise of AI
Explore the transformative potential of artificial intelligence in the legal profession alongside insights into how lawyers in solo and small firms (and their clients) perceive these tools.
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Takeaway #1
Solo and small firms are capturing more clients and revenue than ever, but face challenges with realization and collection performance.
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While solo and small firms are opening more new matters and billing and collecting more than ever, looking at this performance within a larger context indicates that solo and small firms are only making modest gains—and, in some cases, being outpaced by larger firms in areas previously dominated by solo and small firms.
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The average lawyers in solo and small law firms are billing and collecting more than ever before.
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Solo and small firm members who bill their time have taken on more cases over time when compared to 2016.
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Compared to 2016, solo and small law firms have only experienced minor growth in the number of billable hours captured by their employees.
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Takeaway #2
Some solo and small firms face significant struggles with lockup.
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Many solo and small firms face significant challenges invoicing and collecting payments for the work they do. As a result, significant amounts of firm revenue end up being “locked up” in unbilled or unpaid states. The very best solo and small firms have less of their revenue locked up than larger firms, but the lowest performing tend to have even more revenue either unbilled or uncollected.
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Solo and small law firms have more of their annual revenue on hand than larger firms. -
Bulk billing helps firms get their work invoiced to clients, helping reduce their lockup. -
Clio for Clients helps firms in their billing and payments, helping firms increase the amount of collected annual revenue at any given time.
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Takeaway #3
Solo and small firms using online payments get paid more than twice as fast.
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Both solo and small firm lawyers report struggling with their overall workload, growth, and the amount of revenue their firms bring in. Furthermore, many solo and small firms appear not to be offering the payment options that their clients are looking for.
Offering online payments significantly reduces the friction involved for clients in paying their legal bills while helping law firms get paid faster. This difference is pronounced among solo and small firms, which get paid more than twice as fast when using online payments.
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Both solo and small firms get paid more than twice as fast when using online payments.
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81% of consumers are interested in payment plans.
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14% of larger firms are not using cloud-based LPM software, compared to only 3% of solos and 4% of small firms.
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Takeaway #4
Lawyers in solo and small firms have similar attitudes towards AI in the legal profession—but clients are even more enthusiastic, suggesting that those who embrace AI may obtain a competitive advantage.
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Solo and small firms are generally aligned in their perspectives on AI: both cohorts intend to adopt AI technology at a much faster pace than larger firms and intend to use AI to handle routine administrative tasks, including payment and collection. However, clients appear to be even more enthusiastic about the use of AI in the legal profession than lawyers in solo and small firms, suggesting that firms that embrace the transformative power of AI may have a competitive advantage as AI begins to enjoy more widespread use.
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Only 17% of lawyers in solo firms believe that their bar association would never approve of practices using AI-powered software. -
More lawyers in solo and small firms are planning to adopt AI technology quickly (and many have likely already done so). -
Clients are more likely to believe that law firms should use AI for common legal tasks—ranging from marketing to legal research to billing—than lawyers in solo and small firms.
Learn more in the 2024 Legal Trends for Solo and Small Law Firms report
The Legal Trends for Solo and Small Law Firms report features research conducted for the annual Legal Trends Report, which provides information on the most important issues faced within the legal profession. By analyzing aggregated and anonymized data from tens of thousands of legal professionals in the US, supported by extensive survey research, the report offers unique insights into law firm efficiencies, hourly rates, and other key metrics for success.