How Do You Value a Firm When Selling to an Insider?

Valuing a law firm for sale is never as straightforward as one might like. This is especially true when looking to sell to an insider.

Determining a Fair Value for an Insider Sale – Keeping Greed at Bay

Senior lawyers should realize that if they ask for too much, the buyer will start to make completely new calculations. For example, the buyer may start to weigh the costs of starting a new firm against the costs of pursuing the buyout. Successor lawyers certainly realize the advantages of staying in place, but also recognize those advantages are only worth so much.

On the other side of the table, the successor lawyer can’t try to steal the firm away from the senior lawyer. Should the insider offer too little, most senior lawyers will take what time is remaining to sell the practice to another lawyer or law firm and get a higher price.

In short, the marketplace itself prevents the selling and buying lawyers from being too greedy creating a “fair” value.

Setting a Fair Price & Terms for Insider Sale Success

Level-headed minds should be able to reach a fair price and reasonable terms based on marketplace insights. If you’re unsure of how to find the right information to support a fair selling price, look to an expert consultant who can help you reach success in your law firm sale.



What I liked most about working with Roy was his down-to-earth approach to issues. We covered lots, including whether I should modify practice areas, switch law firms, or go solo. Given his own experiences practicing law, as well as his numerous year…" Read the rest
– Of Counsel, small Indianapolis, IN law firm

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