As law firms across the country cut back, Offit Kurman has grown. Rapidly.
The firm, founded in Towson 25 years ago, doubled its revenue from 2008 to 2011 — a period that included the worst-in-decades recession — and added dozens of employees as it expanded its reach across the Mid-Atlantic.
Now Offit Kurman employs about 170 people and expects to keep growing, said Ted Offit, managing principal of the firm and one of its founders.
A lawyer and certified public accountant, Offit, 56, lives in the Glyndon area of Baltimore County with his wife, Risa. They have three sons. As a sideline, he sits on the board of the U.S. Olympic Committee's Bobsled and Skeleton Federation.
He talked recently with The Baltimore Sun about the sorts of lawyers the firm wants, how it grew by recruiting those lawyers or acquiring their firms, and how a rough economy can fuel business.
When did you start the firm?
My brother and I started the firm in 1987. He was a sole practitioner in private practice doing general corporate law and estate planning, and I was a lawyer who was coming out of one of the larger law firms in Baltimore City.
The two of us went into private practice under the theory that small business needed sophisticated transactional planning help and estate planning help. … He took the family side and I took the business side of creating wealth … and grew very gradually through our first 10 years of the operation.
[Then] the world got smaller and local law firms were able to represent clients on a national and international basis. The practice of law changed, and we were a beneficiary of the change.
Law firms [in the region such as Venable] grew to the point that small business was no longer a practice area the large firms wanted to serve. That created opportunities for us.
Entrepreneurs are having problems finding the right law firm for service capabilities because their traditional source of legal help was no longer focusing on local entrepreneurs. We grew, and like any business, you start to grow and you try to figure out exactly what's happening. Then we started planning.
We decided to grow on a regionalized basis. … We were 10 lawyers in 2001, and now we're just under 90. The growth has been fairly explosive for the past three or four years while other companies were retracting during the recession.
How did you manage that?
By attracting highly qualified lawyers to the firm. So instead of growing by finding new clients, we grew by concentrating on finding new lawyers. And we regionalized. During that period of time, we opened up an office in Philadelphia and an office in Bethesda and we've opened up two new offices in 2012 … Tysons Corner, Va., and Baltimore City.
So you're recruiting attorneys who bring clients, as opposed to new business driving the need for more attorneys?
Yes, we're finding attorneys who bring their own business. And then our job of course is to grow that business.
Where are you finding your new attorneys? From other firms in the area?
We are. … We spend a lot of time recruiting and trying to find lawyers, and we've made seven acquisitions of other firms.
How are you persuading attorneys to jump ship?
We tell them that we believe that the mid-market — locally held businesses, owner-held businesses — [needs] local lawyers … and we think there's an opportunity to grow in our marketplace.
So we start with our vision and then we show them our success. Success sells. … Then we do some things that are a bit nontraditional, which lawyers like. One, we have open-book management. We publish all our results to all lawyers. People find that refreshing. Nothing to hide.
What's more typical?
Closed book — compensation is not shared in many firms.
We pay performance-based compensation. So the people that make the most money in our firm are the people who perform at the highest level. It's not based on political favor, it's not based on tenure; it's based on dollars and cents, hard metrics. A lot of people find that refreshing and different in the marketplace.
So there's no reason to have favorites in the firm, to have to look out for who you're going to have camaraderie with — none of that exists.
And everybody knows what everyone else makes?
Yes. Everyone in the entire firm has the same compensation formula, so while we don't publish in black and white, "Here's how much Harry earned" … everybody can figure [it] out. … Just take a look at the production and multiply. Each and every month we publish who produced the most.
How are other firms reacting to Offit Kurman recruiting away their attorneys?
I think the large firms don't view us as being competitive in town, so it's not a real worry to them. I think in the scheme of things, we're a small competitor.
Because you're focusing on different areas.