Mr. Johnson has been a patent attorney for almost 40 years. He started his career as a patent examiner, spent a couple of years in-house and then joined a large, national firm, where he reached partner level. After 30 years, he decided that it was time to make a change and he started a small solo practice, with his wife as his chief paralegal.
Now, Mr. Johnson has decided to hang up the pen for good. His wife always said that he would die at his desk, but he is determined to prove her wrong and is excited about spending time with his 5 grandchildren.
Ms. Miller is 20 years younger than Mr. Johnson, but her intentions are very similar. Ms. Miller is also a patent attorney in private practice, and she has been very successful. She carefully built a property portfolio that is now sufficient to support her rather extravagant lifestyle.
Both Mr. Johnson and Ms. Miller have filed hundreds of patent applications. They are successful and have many clients who trust them and would follow them to the moon and back.
Mr. Johnson and Ms. Miller are victims of their own success. Patent attorneys in private practice can do very well, in large firms or solo practices, if they are able to attract clients, but it is a profession that is somewhat like hotel California – they can check out but not truly ever leave. The relationships with the clients are strong, the clients trust them personally and they also carry a burden of responsibility. Having clients is great as long as a patent attorney is actively practicing, but they can be a responsibility and potential liability if the attorney wants to retire. One might think that a book of clients who pay well is a great asset, but in reality there is little or no liquidity and Mr. Johnson and Ms. Miller will find it very difficult to buy a buyer for their practices. Due to the strong personal nature of the relationships, potential buyers often assume that many of the clients will leave once their favourite patent attorney is out of the picture. Clients are under no obligation and would typically not appreciate “being sold”. Clients may have some characteristics of “an asset” (they generate money regularly) but they do not really belong to anyone.
Add to the commercial difficulty of departing from clients the emotional reality of our two patent attorneys. Even if they wanted a “clear cut” and have found someone to take over their practice – the relationships they have created are there for a reason. They care about their clients. They want the clients to be well looked after. They want to have some legacy and their books of clients are their life’s work.
And so, Mr. Johnson and Ms. Miller are likely to find it very hard to retire.
Many patent attorneys want to retire or semi-retire but they struggle to find a good path – one that rewards them somehow for their enormous efforts in creating a book of business, that appreciates the value of the clients, and that ensures there will be a smooth transition and that the outcome will be favourable to the clients, the retiring patent attorney and also the attorneys who take their place in actively servicing their clients.
Unfortunately, most partnership models do not provide good solutions, and so we have found ourselves investing quite a lot of thought into this matter. After all, Mr. Johnson’s and Ms. Miller’s problems are Mr. Smith’s dream. Mr. Smith is a young, brilliant, and ambitious patent attorney who would be very excited to handle their clients and share the proceeds with them. It is perhaps the case that Ms. Miller’s career started with her gladly working 12 hours a day. It is Mr. Smith who wants to do that now, and so these three patent attorneys have strong mutual interests.
Wanting to retire is just one example of the sort of changes that people want to make in their lives, and perhaps the most extreme example. People go through phases in their lives – sometimes they want to put all their effort into their careers, sometimes they want to leave. They may want to take a 1-year career break or become digital nomads. They may look for a different work-life balance. Some may spend all their time hunting clients and others may be introverts who are perfectly happy to “do the work”.
We are all guided by our values, and when we started Fresh IP one of the values that brought us together is the strong belief that the role of a firm is to support, grow, and enhance the bonds between clients and attorneys. We have not created a firm that will “tell attorneys what to do”. Instead, we took the approach that in order to be the best firm for our clients, we needed to first be the best firm for attorneys. We see the role of our firm as supporting our attorneys and helping them achieve what they need to succeed, whatever success means to them.
For patent attorneys who want to retire, this means respecting their relationships with their clients, allowing them to transition out at their pace , respecting the financial value of their book of business but also supporting them in finding a great new home for their clients. We allow patent attorneys at the end of their professional career to retire with pride.
During 2020, one of the hardest years the world has ever seen, we built Fresh IP as an exciting alternative to traditional patent firms and we have managed to grow significantly despite the headwind of the pandemic. Now that we have a great structure in place, we are calling upon patent attorneys at different stages in their careers to come and join us. Specifically for patent attorneys nearing retirement, please get in touch with firstname.lastname@example.org or email@example.com to discuss how we can help you make the best of your wonderful practice.