With a few exceptions, lawyers have traditionally charged by the hour for legal services. As we spend time with entrepreneurs and startup founders, we have found that traditional fee arrangements don’t necessarily meet their needs. Think about the various subscriptions you use in your day-to-day life such as Amazon Prime, Netflix, Spotify. Then, think about a similar model for lawyers; legal subscription services.
A study by McKinsey & Co. revealed the subscription e-commerce market grew by more than 100% each year for the last five years. The legal industry is moving in the same direction. As we head into 2021, you can expect to see more availability and demand for subscription-based legal services. This blog post provides a little more information about subscription legal services. By the end, you may believe it is a necessity for your startup or small businesses.
What are Legal Subscription Services?
Legal subscription services are an alternative fee arrangement where a client pays a flat monthly (or yearly) fee for a certain set of legal services. Sometimes these fee arrangements are referred to as keeping a lawyer “on retainer.” This fee structure provides clients with the flexibility to contact their attorney as needed, instead of being billed by the hour. A subscription for legal services works similarly to the other subscriptions you have in your life, such as Netflix.
You might find some parameters based on the package you choose. This could be a limit to the number of documents reviewed or certain excluded tasks (such as trademark work). However, generally, once you pay your monthly or yearly fee, you have the access you need to your business lawyer.
Benefits For Businesses
If you are starting a new business or operating an existing business, you can benefit from subscription legal services in several ways. These benefits include:
Reducing Economic Uncertainty
Traditional hourly billing may lack transparency, especially with larger firms. You aren’t quite sure what services are included in your bill, and additional costs for documents or expenses aren’t always clear. As a business, you need as much economic certainty as possible while you try to grow. When you pay monthly subscription fees for your legal services, you know exactly what you are paying for. This makes it easier to budget all the expenses of running a business.
Meeting Your Needs
Sometimes, you may not know exactly what you need and/or want, and you’ll find some lawyers pushing things that may not be necessary. The lawyer by subscription services is more client-focused. You can expect your business lawyer to focus on your specific needs, instead of offering the services they think you need.
Many firms do not offer a specific subscription for startups nor do they offer flat fee startup packages. These services could include helping clients establish their legal entity and preparing internal corporate documents.
Avoiding Costly Mistakes
As you start your business, you might have considered avoiding legal fees altogether and going at it alone. This might seem like cost savings, but in fact, it can hurt you more in the long run. Lawyer by subscription allows you to get the guidance you need without breaking the bank. In most cases, you will find monthly or yearly fees affordable. When you choose to subscribe, you could potentially save yourself a lot of money in costly mistakes.
Are Subscription Legal Services a Necessity?
For businesses looking to have a fixed monthly fee for a lawyer’s services, a legal subscription might be a necessity. For more information about subscription services, contact us today, and check out our Outside Counsel Subscription Services!