Chris Dreyer:
It takes a certain type of personality in order to manage a business successfully. You've gotta be able to get into the nitty-gritty details while simultaneously thinking of the big picture. Add managing people to that and - let's be honest - being a CEO can be an all-consuming task. So imagine if you didn't just have to run one firm, you had to run five! When I first heard the story of today's guest I thought - more money, more problems! But this attorney has made delegation into an absolute art...
Andrew Finkelstein:
I micromanage my delegation. There's clear step-by-step processes, clear mutual understanding of what is needed to be accomplished. And then once we agree on that, I'm done.
Chris Dreyer:
Andrew Finkelstein is legendary in the personal injury attorney space for heading up a grand total of FIVE different firms, from New York to California! Today, Andrew takes it back to where it all began - we hear about how his legal empire started out, what his non-negotiables are when it comes to acquisitions, and what is the secret sauce in the art of delegation. That's coming up on The Rankings Podcast - the show where founders, entrepreneurs, and elite personal injury attorneys share their inspiring stories about what they did to get to the top and what keeps them there. I'm Chris Dreyer, stay with us! When Andrew Finkelstein started working for his dad at Finkelstein & Partners, there was no inkling that he'd even up sitting on the board of FIVE different firms. His strategy in the early years was to get as many catostrophic cases as possible, which worked so well they had to grow geographically - ending up with 18 offices in New Jersey and beyond. Andrew's first acquisition took place in 1999, and it began with a phone call out of the blue...
Andrew Finkelstein:
Actually it was Gail Koff who reached out to me and asked me to consider taking over her firm, managing her firm with her. She was at a point where she was the sole equity partner in the entity and her core competence was marketing and advertising. And she was smart and recognized her core competence wasn't in managing of the entity. The partner. Who was Steve Myers, managing the entity died in a car crash three years earlier. Now I had never met Gail. I'd never met Steve Myers, but she just reached out to me cold and said, would I be interested? And we met a few times and ultimately obviously worked out where we took over Jacoby and Meyers and started managing them quite effectively. And, as happens, lawyers talk. And another lawyer reached out to me and asked me, Marvin Andaman, would I be interested in doing the same thing with his firm that I did with Gail? What enabled me to do this though, is maintaining each of those entity's goodwill and the goodwill being their brand and their marketing brand in their respective market area. And when a lot of people think of mergers or takeovers, they think that one entity absorbs another well, I, think it's a mistake in the legal industry. If the organization has a defined brand that the consumers are well aware of, there's a lot of goodwill there and a lot of money has been spent to develop that brand recognition. And, in my opinion, it's a mistake because of ego to take that brand out of the marketplace and replace it with another name or add a name to it.
Chris Dreyer:
So each of these are operating as like a decentralized kind of in an autonomous capacity. So do they operate with like their own PNL or their own entity? Are they all in that decentralized manager center, similar to like a, I dunno like an LVMH or a Proctor & Gamble or something. Is that kind of how it's designed?
Andrew Finkelstein:
Well, uh, it is, uh, bit of a Frankenstein architecture of define it that way. Let me bottom line it up front for you though. Yes. It's very much like Proctor and gamble. They are all have separate P and L's and they all operate independently because we're required to by law. Law firms are not allowed to incorporate, you can't operate under a trade name. So somebody, a lawyer, can't just go out and open up Jacoby and Meyers, if their name is not Jacoby and their name is not Myers, but I guess the guy who plays football for the New England Patriots could open up Jacoby and Meyers if he gets a law degree, but that's one of the protections that this arcane system provides to lawyers that you can't just say you are something you are not. So in order to maintain the goodwill in those entities, we had to maintain that they're separate entity structure, that each of those entities have a separate tax ID. I joined their firms, they were not merged in any way. Each entity is a separate entity and they are managed by me and my team. And we call ourselves sister firms. They're all sister organizations of one another, which means they are related the employees and lawyers of each entity have the ability to, when asked, perform work on the sister entity. And what that affords our clients is the ability to have access to people, have broad range of experience in a particular type of matter. And so if there's an attorney at Jacoby and Meyers, who is a great nursing home experience against a particular nursing home, as an example, and a consumer client reaches out to Finkelstein and Partners, then the Jacoby and Meyers lawyer will be of counsel and work on that case for the benefit of the client. The client doesn't see really any of that aspect of it, they just know they're getting the best lawyer for that particular type of matter. The benefit of doing it is that there is a shared as an example, I've a intake department, there's one intake department for all of the entities, meaning new case call center. There's a marketing department. We have different marketing staff that focuses on different brands, but they all collaborate. So we use best practices amongst all of the organizations, as it relates to, for example, SEO, um, are just think of any backend operation that is all consolidated.
Chris Dreyer:
Got it. You've been asked this question before, so you got out ahead of me on the creating synergies. So, so basically you can get those bulk purchases to maybe some saved money on like equipment or purchases, and then you've got some. Cross-department synergies for, you know, having talent for a particular case because there's unique cases that come in and then also the marketing synergies,
Andrew Finkelstein:
Also the physical presence, it, we all share offices, right? So every now every organization has 18 offices.
Chris Dreyer:
Absolutely. So let's back up a step before we get to this. Let's talk about on the valuation side. So how are valuations different for say personal injury firms? Is it still mostly centered around EBITDA or is it, or is there more value placed on the people, territory and brand? How does, is it an art and a science? How do valuations differ for personal injury firms?
Andrew Finkelstein:
You know, that's a really interesting question. So valuing personal injury law firms in the marketplace have two significant factors. One is the existing inventory and the value of that existing inventory and the critical evaluation of when that will roll off. And usually it's one to three years, but more importantly in the evaluation that. Is the most challenging is how fast does it, will it take for the organization to replenish that organize that inventory of cases? And this is where many lawyers are overly optimistic, that it can just automatically happen without investment. There have been many firms or attorneys have reached out to me and they have asked me to be engaged in taking them over. And those that I've, I've done the due diligence and I'm shied away from is because most of their inventory or cases that have been generated because of personal relationships and from an organizational standpoint, one has to say, well, what if that individual who is driven those personal relationships disappears? Then the opportunity for that future business disappears. And then I'm left with overhead and no way to pay that overhead because there's no revenue coming in because there's no new cases coming in. So from an acquisition standpoint, the organization can't be driven primarily based on personal relationships because they can disappear quite quickly. So when I'm involved in valuing an organization, I put a premium value related to the brand that may be in the marketplace. The other component of what I evaluate, which is a bit more difficult are the competitors in the marketplace who else has a strong brand and who are we competing against? Now the ideal scenario is I have two brands in the same marketplace. There's nothing better than competing against yourself because the consumer just like Proctor and Gamble has competitive brands in the same vertical, whether it be detergent or whatever they may be, but they'll have different products in the same vertical because you can't satisfy everyone. And there are certain brands that attract to certain people. And I just want to be able to satisfy all of it.
Chris Dreyer:
As a follow-up to that. So do you try, like, let's say you have a firm in the same territory and you have that double real estate. Is there a clear tactical approach to trying to establish unique value propositions for each entity?
Andrew Finkelstein:
Absolutely. Absolutely. It's different, it's a different branding message for each one, whether it's a union based firm, whether it is a high-end catastrophic injury firm or whether it is a more of a volume practice there's different elements that you want to communicate.
Chris Dreyer:
I love that. And it makes me think of, so we had Michael Gibson on and he was in the same market as Morgan and Morgan and his marketing team really pushed back against him. And he took a family approach and it was totally different in how he was representing himself as more approachable and family-oriented and it really worked for him. So, you know, it makes sense what you're saying, you know, like one firm could represent themselves as a killer trial firm versus a, maybe a more softer approach type of value proposition, right?
Andrew Finkelstein:
You have to know who you are and what your messaging is and say, stay true to it. It, if there's inconsistency in your messaging, it'll be a challenge to attract business.
Chris Dreyer:
It's actually pretty rare to find someone who is a managing partner of so many different firms. On the one hand, you can see that operating in a decentralized capacity with all those cross synergies has huge benefits. But I wanted to find out how that affected those all-important core values. Does anything get lost in translation from entity to entity?
Andrew Finkelstein:
What gets communicated from a marketing positioning standpoint is different, but the cultural approach to how we as organizations treat one another is identical. In fact, the onboarding process to whatever organization has one statement. It's a three page statement with every firm's logo on top of it that you're joining an organization that we stand for certain principles. And when I say joining an organization that is a sister firm of all the organizations and we all stand by the same principles and those principles include treating people with dignity and respect to our colleagues, our clients that's we prioritize that investing in ourselves, education, continuous learning. And it all frankly flows for me that I have a clear management style where I always presume positive intent and everybody understands I presume positive intent that, that when any action or activity is undertaken I presume that it is done for the best interest of the organization or our clients, depending on what that decision is related to. Now, that doesn't mean that every decision is right and it turns out that it was in fact the best interest it may not be, but I don't presume that people have some type of ulterior motive and they're not trying their hardest. And by creating that culture, we can receive constructive criticism pretty well because then the motive behind it, isn't a personal motive. The motive behind it is, let's do better next time for the organization. I know you tried your best and you've made decisions that you believed were the right decisions for the client organization, whatever it may be, but it really wasn't. And here's the reason why, and when it's approached from that vantage point. The listener doesn't hear a personal attack is really what it comes down to because it's very hard for people to hear constructive comments that are truly intended to help them. They take it personally and we're humans, we can't help but be emotional about it. But if we try to remove that emotional upfront baggage that people may have with found it to be quite helpful. So those core management principles are across every entity.
Chris Dreyer:
That's an amazing answer. And, you know, I was, it was kind of a self-serving question because we did a small acquisition and I was wondering, well, do I have to go through the whole process to establish each business's values? But I'm like, well, I own the business. So it needs to come from me and the share, you know, the people that I want to work with, need to share the same type of value.
Andrew Finkelstein:
Yeah. I have done mergers that haven't worked. And here's the only reason why it wasn't a cultural fit. Right? The first time I got lucky with, Jacoby & Meyers, it was a total cultural fit and I understood and evaluated the cultural aspect of it and Gail Koff and I were totally aligned. The next one, Marvin Anderman, we were totally aligned culturally on the things that we're talking about. Well, I won't go into names, but I've done it where. I thought we were culturally aligned because that's what I really spend the time on. But as soon as the transaction occurred and we started integrating, it was clear that we were not culturally aligned and it lasted nine months. You know, you get to it once you realize that it's got to be a big boy and say, made a mistake here and move on.
Chris Dreyer:
Yeah, I think that's a great piece of advice and, you know, Hey, we're wish you the best of luck. And now, you know, that that culture is so important. You probably are really targeting that and focusing on that. Now, when you approach new opportunities, absolutely. So let's talk just briefly on the time management side, because I think it's so interesting. A lot of people have difficulty shedding, those hats and the concept of owning multiple businesses and some individuals just thinking, man, I'm barely keeping my head above water, you know? So how do you approach time management for yourself? And what's your advice on delegation?
Andrew Finkelstein:
Well, you answered the question, ask the question with my answer. It's about delegation, having trusted people that you have, the confidence that will execute on that, which you are delegating, but there's an art to delegating, right? I micromanage my delegation, but after I micromanage that delegation, I move away from it. I really spend a lot of time making sure whatever I'm delegating. There is clear step-by-step processes, clear mutual understanding of what the expectations are, what is needed to be accomplished. And then once we agree on that, I'm done. And when I say done, I have full faith and trust that it will be executed. It's important as part of the delegation process to not just micromanage it and define precisely what your expectations are, but you have to incorporate the time aspect of that. You know, deadlines when you want certain activities done together with what the type of reporting you expect back. If you cover all of those bases, then you should have the confidence that it will be done. And if you don't, then you're delegating to the wrong person. Whether that person doesn't have the skillset needed to execute on those activities or. They're just not trustworthy, right? That you, and you have to make those assessments upfront. And if you don't do that, that's where it falls on management. And you have to take full responsibility. You can't blame the person that you delegated it to, if they are not the right person to delegate it to.
Chris Dreyer:
Yeah, the right people, right seats thing, get them on the bus, off the bus type of situation.
Andrew Finkelstein:
Yeah. Just because you delegate doesn't mean that you absolve yourself of responsibility, you don't have to accept full responsibility if you've made the wrong choice of doing that.
Chris Dreyer:
Absolutely. Absolutely. And so, so kind of flip it over to the, on the personal side here, I've got kind of a, an odd question here, but do you believe in work-life balance if you love what you do?
Andrew Finkelstein:
A hundred percent. Yep. I have to have a work-life balance. Now. It's easy for me to answer this. The real person to ask the question to, is my family though, right? Because you know what I see through my vantage point may be different than what they see through their vantage point. But I will say that I think it's critical. I, you have to totally invest in yourself to be able to be your best self for others. And that investment comes and, you know, different it's totally individual, whether it's physical investment, investment in your psyche, right? You know, taking time, quiet time, whatever that may be. But if you are stressed out or not, all their people totally sensitive and they read you as a leader and you have to be current and present to be able to be effective.
Chris Dreyer:
I love that. And Andrew, as we close up, we have a three for three segment. It's just three questions in three minutes. And so, number one, what is your top marketing tip for attorneys?
Andrew Finkelstein:
I can't answer that in one minute, but I will say have a strategy, have a straight, right. Don't just don't go after the next shiny object and make sure you have a total strategy and understand where it fits into that strategy. If you don't have a strategy for your marketing undertaking, then it's doomed to fail and you may get lucky every once in a while, but you have to have a clear strategy.
Chris Dreyer:
I love it. And which entrepreneur do you admire the most?
Andrew Finkelstein:
Which entrepreneur do I admire the most? That's a tough one. You know, I would have to say Steve Jobs. And the reason why I would say Jobs is multiple, he, you know, he built Apple but he had multiple challenges to get there, having left and then had to come back.
Chris Dreyer:
Wonderful. And which one book has had the biggest impact on your life to date?
Andrew Finkelstein:
On my life. Well, yeah, I'm going to define that professionally. I guess there are several books, so I can't really distill it down to one, but I would strongly encourage, it's an older book, it's called True Professionalism. I don't even know who wrote it, but there are some core concepts in that book that if you read it, you can embrace it. They really can help develop in a professional service organization and acting with true professionalism and recognizing because we often get romanced into thinking competency equals professionalism. And that's not true at all. Somebody can be a great trial lawyer or very competent in some other field, but that doesn't mean they're a true professional and a true professional is what we all should achieve and acquire to what a true professional is. I leave it to you to read the book.
Chris Dreyer:
Andrew has to be the leading authority on legal 'mergers' - or whatever we want to call them. There really isn't a manual on this, so he had to learn through experience how to see beyond the smokescreen and assess the true value of a firm. That acquired skill lead to shrewd decision-making in terms of acquisitions, and alongside his operational synergy and strong core values, I'm betting that the Finkelstein empire is going to keep on growing to new heights. You've been listening to The Rankings Podcast, I'm Chris Dreyer. A huge thanks to Andrew Finkelstein for joining us, and you can find more info, as always, in the show notes. And we want to hear from you! Has Andrew inspired you to rethink your delegation and elevation? Drop us a review and let us know! Thanks for joining us, we'll see you next time.
