From Bare Bones to Big Time

Episode 14: From Bare Bones to Big Time

When Art D’Egidio first started his law firm, the fax machine was in the living room while his business partner ran the phones out of his house. Fast forward to today, he’s grown and scaled his practice to one of San Diego’s top personal injury law firms. Join host Pratik Shah on Episode 14 of The Bootstrapped Solo as he sits down with Art to discuss his journey to success – and the humble beginnings that helped paved the way.
In This Episode
Transcript

Pratik Shah (00:00:07):
Hi everybody, and welcome to another episode of Bootstrapped Solo. I am your host Pratik Shah, and today we’re going to be talking about the good, the bad, and the ugly about running your own practice. This podcast is for those that want to know what it’s really like to start, run and grow practice. Today’s guest is my good friend, Arthur D’Egidio. He runs an eight-person practice out of San Diego that focuses on personal injury. He started his practice 12 years ago and has been growing strong ever since. Arthur, welcome to the show.

Arthur D’Egidio (00:00:37):
Thank you for having me.

Pratik Shah (00:00:38):
Thanks, Arthur, for being on. Obviously you and I have a unique relationship. Just for all the listeners to get them up to speed, Arthur and I used to be business partners. We ran our firm together for a little over six years. We had some great times that ended recently about 10 months ago, and we’ve remained friends and everything is all good. But Arthur, we’re going to go back to the beginning and we’re going to talk about those really early days, the fun times.

Arthur D’Egidio (00:01:05):
Let’s do it.

Pratik Shah (00:01:06):
A couple days ago, you and I were preparing for this and talking about it and you said to me, “Those were the good days. I really miss those days.” Do you stand by that statement?

Arthur D’Egidio (00:01:18):
I did. Well, I do. Look, obviously I’m happy where we are as a firm and in my profession, but it was a little more loose, not as much responsibility. Obviously I didn’t have a family that I do today, and so as you’re learning, you’re figuring things out. You don’t really know what’s expected, so it’s all very new. It’s all very exciting. Right now, we pretty much hit our nice flow and so the day-to-day is pretty much routine; whereas, back then, it was like the Wild West. We were signing cases. We weren’t doing specifically personal injury. We were practicing what we call door law, anything that comes through the door, and it was just an exciting time. So for different reasons, I enjoyed it back then. But obviously I enjoy what we’re doing now, and the practice is doing better than ever, so it’s an exciting time now, but it was just different, man.

Pratik Shah (00:02:19):
Awesome. No, absolutely. I want to get into that a little bit. When you talk about an office and you talk about an exciting time of learning everything, what were the areas of practice that you took cases on in your first year?

Arthur D’Egidio (00:02:37):
So just a little bit of history, we started the practice right out of law school. I graduated in 2009 from Thomas Jefferson. For those that remember, there was the big recession. A lot of firms were either closing their doors or laying off a lot of people, so there wasn’t a lot of opportunity when I had passed the bar and then was looking for employment. So two buddies of mine from law school said, “You know what? Why don’t we hang our own shingle and see how it goes?” So the first office was one of our former partners’ second bedroom in his apartment in Pacific Beach, San Diego. I lived a block away from him, so I had the fax machine in my office. He had the phone line in his office, so the main phone was his line.

(00:03:26):
So if we ever had to fax anything, he’d have to run over to my house and then we’d scan it and send it. But any calls that were coming in, we’re going to his house. So we were basically just figuring it out. Then back then, with the recession being what it was, we were doing civil litigation, bankruptcy, a lot of bankruptcy back then and personal injury and real estate. We were trying to basically get clients and pay the bills and obviously our overhead was a lot less back then, but we were still trying to make money. We were essentially just networking and trying to meet people and just signing whatever case we took. Some of them we probably should have said no to, and we learned that the hard way. But back then we were starting the company and we were just taking any case we could get our hands on.

Pratik Shah (00:04:19):
Let me get some more detail on that. So if I remember correctly, I’ll fill in the names here, it was you, Mike, and Craig, right? That started out-

Arthur D’Egidio (00:04:27):
Correct.

Pratik Shah (00:04:27):
Out of law school.

Arthur D’Egidio (00:04:29):
Yes.

Pratik Shah (00:04:29):
So you and Mike lived about a block away from each other, correct?

Arthur D’Egidio (00:04:33):
Right. Mike and I, we were the ones that started the practice. Craig was working for someone else. He was doing estate planning for someone else, so he was working with us but also had another job. So ultimately, we talked to Craig and said, “Look, man, we need you to be all in. So you got to make a decision.” He chose to go with the estate planning and he’s doing great. He stuck with estate planning. He’s been doing it since he graduated as well. Then it was just Mike and I, and Craig helped us ’cause we were doing some wills and trust and stuff like that. Craig still helped us in handling those clients.

(00:05:17):
But ultimately, we ended up getting a space with subletting from a mortgage company because they had a huge space with a call center and everything. But once the market crashed, they had a ton of space left over. So we were trading services, so we were helping with some of their clients who needed to file for bankruptcy and do a short sale then in return, we were able to share some space. Like I said, it was like the Wild West. We were figuring it out and doing whatever we took. When we got that first office, it was a big deal to us, but it was a dump, man. It wasn’t a great office. We were in the back of this old mortgage company, but I was working with one of my close friends who I’m still in a fantasy football league with him and we still talk regularly, we were figuring it out.

Pratik Shah (00:06:08):
Yeah, absolutely. No-

Arthur D’Egidio (00:06:08):
I don’t know where you want to go from there.

Pratik Shah (00:06:11):
No, before we get into this, the back of the mortgage company office, I want to talk about the Pacific Beach Home office. So you and Mike are a block away from each other. You’ve got essentially half the office with the fax machine, he’s got the phone line. Then did you guys just have two cans on a string where you would be like, “Hey, there’s a call coming in, do you want to take the call?”

Arthur D’Egidio (00:06:36):
Yeah, pretty much. No, we know we used our cell phones.

Pratik Shah (00:06:38):
Oh, good.

Arthur D’Egidio (00:06:38):
So we had our cell phones and so most of the time I had my desk and the fax machine set up in my bedroom. So we had a small little apartment in PB, Pacific Beach. I had the living space and then the home office and the bedroom. I would just wake up in my pajamas, go to the desk, start calling and do what I need to do. I was haggling with adjusters, getting faxes in, scanning those, sending them over to Mike so he could get them in his emails. Again, it was a very, just a bones operations, but it worked and we grew from there. Again, the good thing about back then is when you have 10 clients, it’s easy to give them all your undivided attention. So every client we had, I remember one of my first ones, his name was Mark. It was a great case. It was a rear-end auto accident.

(00:07:39):
He ended up needing to have foot surgery, but it was a $30,000 policy. I remember getting the policy and they were basically, “All right, look, the case is there, we’re going to tend to the policy limits.” I just went guns blazed, and I was like, “No way. This isn’t enough. There’s no way we’re going to accept that.” Then I talked to some friends and they’re like, “Hey, what else are you going to get from that case? Those are the limits. The guy’s insolvent. That’s how it is.” So first case, I learned that and now, you learn a lot in the 12 years of practice, but that was one client that I still remember him. Unfortunately, he has passed away. I found that out about a couple of years ago. But we were friends ever since I had that case with him, because you could really create a bond with the clients that when you don’t have that many. Now we have a lot, but you still want to create that bond, that chemistry with your clients, but it was easier when you didn’t have as many.

Pratik Shah (00:08:37):
Yeah. Well nowadays, maybe you have the clients, but they’re not necessarily creating the bond with you, but somebody else in the office, because they can’t-

Arthur D’Egidio (00:08:45):
Exactly.

Pratik Shah (00:08:45):
… create the bond with you and that’s why you have a team. But okay, so you’re getting these cases, you’re doing some business litigation, sounds like you were doing personal injury. I know Mike did a lot of the business litigation-

Arthur D’Egidio (00:08:56):
That’s right.

Pratik Shah (00:08:57):
… and you had Craig helping out on some estate planning and it was basically, “Hey, anybody need anything? We’re here for you.” How did you guys get new business in the beginning?

Arthur D’Egidio (00:09:08):
So there were some network groups in Pacific Beach where we lived, and so we would go to those. We would go to all the happy hours and the events. In the early days, PB Rec Center had an open gym from 1:00 to 3:00. So not being that busy, Mike and I would go to the gym from 1:00 to 3:00, play at the open gym, play basketball, and we actually got a lot of cases from the guys that we were playing with. So it’s just the boots-on-the-ground, just human- to-human interaction, creating relationships. Then ultimately, they say, “All right, look, you’re a lawyer. My buddy’s got a problem,” or, “I got an issue, can you help me?” “Yeah, of course. What’s the issue?”

(00:09:55):
If it was anything that was really out of our comfort zone, we had people that we could bring in or consult with, but for the most part, we were able to take care of the people that were hiring us, but that was it. It was really just networking. I remember one time we went to a network event and we had our business cards and we were handing them out. This older woman, she looks at the card and she says, “Hey, I know where this is. This is an apartment complex.” I was like, “Not, it’s not.” I was like, “It’s an office.”

Pratik Shah (00:10:31):
It’s an office now.

Arthur D’Egidio (00:10:34):
I was like, “Just give me the card back. Don’t worry about it,” so it’s just stuff like that. But we needed it cause the mail would go to Mike’s house, which was our office until we subletting the mortgage company.

Pratik Shah (00:10:49):
How long were you doing this apartment/office business thing? It’s not like nowadays where everybody works from home and there’s no stigma-

Arthur D’Egidio (00:10:57):
No.

Pratik Shah (00:10:58):
Back then, there’s a huge stigma to saying, “Yeah, I’m a lawyer, I’m an attorney. I run my own firm and I work out of an apartment.” Not even a house, it’s an apartment.

Arthur D’Egidio (00:11:08):
Right.

(00:11:11):
No, absolutely. So we were probably … Go ahead.

Pratik Shah (00:11:14):
You would put on your business card a suite number so it looked like an office, but it’s an apartment?

Arthur D’Egidio (00:11:18):
No, it’s an apartment number. I think it was number B or something like that. So hey, that could be a suite, whatever. Let’s just say we didn’t really meet a lot of clients at the office.

Pratik Shah (00:11:31):
Right. Right.

Arthur D’Egidio (00:11:31):
We used Starbucks Because you didn’t have a lot of the shared space, like the-

Pratik Shah (00:11:37):
WeWork and stuff like that.

Arthur D’Egidio (00:11:40):
Yeah, exactly.

Pratik Shah (00:11:40):
And Regis.

Arthur D’Egidio (00:11:41):
We didn’t have a lot of those back then. Regis, yeah. We just would meet them at Starbucks or sometimes we’d meet them at the old law school library. You’d get a conference room or something in there. Look, the clients, they trusted us. Full disclosure, we told them, “Look, we’re working out at Mike’s apartment. We’re a startup, but we can handle this case and we can do a good job for you, just put your trust in us,” and they were happy. Then, if you look at our Yelp reviews, we still have a lot of those old clients who left us good, positive reviews because they were happy with what we did. But yeah, I think we were in the second apartment bedroom for about six to eight months.

(00:12:26):
Then a friend from law school, his cousin was in the mortgage industry. We were working on a case with my buddy from law school and he was like, “Hey, I want you to meet my cousin. I think you guys could probably help,” because he knew we were doing the short sale stuff and the bankruptcies, so working with his cousin who’s doing the mortgages, he thought it could have been a good fit because they were already sending us some clients anyway. So then he put us together and turned out they had a few office spaces that we could use. So yeah, that was a big moment for us. We got out of the bedroom and into an office.

Pratik Shah (00:13:09):
Sorry. Sorry. Sorry. You said that was about six months in, so six months you were able to find this little mortgage space to get it-

Arthur D’Egidio (00:13:15):
Right.

Pratik Shah (00:13:15):
Awesome. You mentioned that you did bankruptcy. Did you work at a bankruptcy firm in law school, or … ?

Arthur D’Egidio (00:13:24):
In law school I worked for the San Diego Volunteer Lawyer program and then just a civil litigation firm. It was a small boutique litigation firm, so that’s how I learned to handle the cases. Bankruptcy was new though, and Craig, who was also doing the estate planning, shared a space with a bankruptcy lawyer. Craig was also doing a little bit of bankruptcy, but he didn’t really like it. He was more focused on the estate planning, and so I learned it. Essentially, you read the study guides and then you learn. There’s a program out there called Best Case. So once you figure out how to use the program and how it applies to the Means test and all that stuff, then you can actually pick it up. Bankruptcy is tough because it seems like it could be easy because you’re just going on the program and pressing numbers or clicking buttons and inputting numbers, but it’s tough because there’s a lot of liability involved because once you filed, all your assets are held in trust by the trustee.

(00:14:30):
So if you file something and you miss something and you do something wrong, those assets could be seized. So if you’re not careful and you don’t know what you’re doing, you can really get in trouble that way. I did have a mentor that was able to show me the ropes, and in my first few cases I would prepare everything and then I would have him review it to make sure that we were doing it right. Then, if I ever had questions, he was very helpful. I could ask him, say, “Hey, I got a more complicated case, what do you think of this?” You find people who can give you appraisals for properties and stuff like that. Back then, everything was underwater, so you didn’t have any issues with the trustee trying to take a property to sell it, to pay off creditors. But nowadays, it’s tough because the real estate market’s so high.

Pratik Shah (00:15:12):
Yeah. Your partners were doing civil lit business, real estate, estate planning. You were doing bankruptcy, some personal injury, and you were learning how to be a bankruptcy lawyer as well as learning how to be a personal injury lawyer. Did you already know how to do personal injury? How’d you learn that?

Arthur D’Egidio (00:15:30):
I had more personal injury experience from law school, but I also had another mentor that pretty much showed me the ropes with personal injury. He was a friend of my father’s, and so I’ve known him my whole life. When I went to law school and I reached out to him, I said, “Hey,” his name is Ron. I said, “Ron, I’m new to this. We’re starting a practice. I do have some personal injury clients.” I had talked to Ron during law school too, and he showed me a couple things here and there, and I worked at other firm that where I learned more. But Ron was really instrumental in learning the initial phases, just rep letters, HIPAAs, policy traces, the basics. Then you realize, “Okay, not all these cases are going to settle. You’re going to have to file some lawsuits.”

(00:16:24):
I had another attorney that I worked with on some of the litigation stuff early on who showed me how to litigate a case. So I think it’s really important, especially early on to latch on to people and learn from people who have done it before us. I feel like even people at the top of the food chain are still learning. We’re all still learning. We’re all trying to perfect this craft in this industry that we’ve chosen. So especially early on, there’s people that have done it ahead of us that know more than us that we can reach out to. You’d be surprised if people are actually willing to help, and that’s what I found is that people were pretty generous with their time. So I could call them and ask them questions. Obviously don’t ask the same question twice, do your research and don’t abuse that, but I found them very helpful.

Pratik Shah (00:17:13):
That’s a big thing that if you’re going to ask people for help, you’re going to find that they’re super helpful. But if you find yourself calling and asking the same question, if you find yourself calling and then going completely against their advice and then asking them to fix the problem, when you created a problem for yourself by not listening to them, they’re going to start to be a little less helpful as you start moving forward.

Arthur D’Egidio (00:17:36):
Correct. When we were working together, we experienced this, I think we’re at a point now though, where I’m still helping those who are coming up and learning it, but I’m getting help from those who’ve done it longer. So I’m in the middle now, where I can help those who haven’t done it as long, but I’m still learning from those who have done it 20, 30 years, and so it’s constant. We’re still learning. But as you know, those who ask for advice, you give them your best advice and then they do the opposite and then they say, “Oh man, you won’t believe what happened.” I was like, “Yes I do. You didn’t listen.

Pratik Shah (00:18:12):
Yeah, I 100% believe that.

Arthur D’Egidio (00:18:12):
What are you going to do?

Pratik Shah (00:18:12):
I can’t tell you-

Arthur D’Egidio (00:18:12):
Exactly.

Pratik Shah (00:18:17):
… how many times we’ve had that where-

Arthur D’Egidio (00:18:20):
I know.

Pratik Shah (00:18:20):
… people call us, we tell them what to do, they do the exact opposite. Look, you don’t have to listen to everything the person tells you, you have to make your own decisions. You’re obviously a lawyer and an adult, but then when you get stuck in a problem, you can’t go back to that person and say, “Hey, I screwed up.”

Arthur D’Egidio (00:18:37):
You can try, I don’t know-

Pratik Shah (00:18:40):
They’re going to be a lot less open to guiding you there. But yeah, you’re right. It’s being aggressive in networking, being aggressive in wanting to learn. You mentioned a lot of things in the last 15 minutes, 10 minutes, which is, you’re reading the rudder group, the practice guys. You’re learning how to become a better lawyer, learning how to navigate the court system. You’re asking mentors for help, you’re having them review your files and give you advice. You’re calling others and still networking by talking to your law school friends, et cetera, et cetera. You’re then also at the same time figuring out how to get faxes and emails and pay the bills for all that stuff happened. Then one thing we haven’t even gotten into is when you’re doing bankruptcy and stuff like that, you got to collect money from your clients. Like with PI-

Arthur D’Egidio (00:19:27):
Oh, yeah.

Pratik Shah (00:19:28):
You get an insurance company sending you a check that you put in your trust account and you get your fees, but on all these other areas of law, you got to get your client to write a check.

Arthur D’Egidio (00:19:38):
Right. Again, there’s a lot to unpack there. Look, if I had to go back to the beginning, I probably would’ve started with a business model and mapped it out. Look, hindsight’s 2020, right? We were shooting from our hip and just figuring it out. So the one thing that we realized early is bankruptcy was good because the client had to pay upfront. So you don’t do the work and you don’t file the case until you get paid, and it was guaranteed. The PI stuff took a little bit longer, but when the case is settled, you’re guaranteed money because the insurance company was going to pay you, so you were good. The hourly business clients, how much time you got?

Pratik Shah (00:20:31):
Let’s hear it.

Arthur D’Egidio (00:20:32):
That was a whole nother situation where, and I don’t know whoever’s listening to this, if you’ve had hourly clients and you’ve had to hold their funds in a retainer, send them to hourly billing statements, give them the trust ledger, all that stuff that’s regulated by the rules of conduct, it is a very tedious task in and of itself. So add to that, when the trust gets low and you say, “Okay client, now you’re down to $500 or less, it’s time to replenish the retainer,” it’s not always a fun conversation. You get a lot of, “Oh yeah, don’t worry. Check’s in the mail. Oh, I’m just waiting for this to happen, then I’ll get you. Don’t worry.” We got a lot of that and one month, two months, three months go by and we’re not getting any money. Now we’re in the negative, so we’re billing and each month you still got to work the case.

(00:21:31):
You can’t just stop working on the case if the client’s not paying you. So you ultimately start going into more and more debt, essentially the client is. If the retainer’s five grand, they ultimately owe you like 20. So if they give you five again, that’s just gone, so it’s just a constant battle. If you stay with it too long, you can’t get out of the case because you can’t prejudice your client, so you’re stuck representing the client. But it’s just a tough situation and plus, you have a relationship with the client, so you don’t want to leave them hanging; but at the same time, it is a business. So those were difficult decisions that we had to make-

Pratik Shah (00:22:10):
I think it’s important-

Arthur D’Egidio (00:22:12):
But in the beginning-

Pratik Shah (00:22:12):
I’m sorry, go ahead.

Arthur D’Egidio (00:22:15):
Yeah, so I was saying, but in the beginning when the retainer’s there, they’re paying, so it’s good. That was also to help with the bankruptcy stuff because when those were initial money that we were seeing, while the personal injury cases were taking their time to settle.

Pratik Shah (00:22:30):
For those that are listening, to touch on something that Arthur’s saying, if you’re working business cases now and you’re at a larger firm, chances are you’re working … One, you don’t have to worry about that stuff. You’re going to get paid no matter whether the client pays or not, your boss, your payroll gets hit on the firm. But two, chances are you are dealing with large businesses or medium-sized businesses that understand that litigation is part of the process of owning a business. When you’re starting out and you’re thinking about the businesses that are hiring the brand-new attorneys to be their business lawyers, you’re not dealing with the most savviest of business owners.

Arthur D’Egidio (00:23:12):
We used to get paid in meatballs-

Pratik Shah (00:23:13):
And Salsa.

Arthur D’Egidio (00:23:14):
… and chicken quesadillas.

Pratik Shah (00:23:17):
Don’t forget the salsa.

Arthur D’Egidio (00:23:18):
You remember those days, the salsa. That’s right. Exactly. Exactly.

Pratik Shah (00:23:22):
I remember.

Arthur D’Egidio (00:23:23):
Unfortunately can’t pay the bills with meatballs and salsa. What a world.

Pratik Shah (00:23:28):
I remember walking into the break room and there was a bunch of salsa there and I was like, “Oh, who brought the salsa?” I thought somebody brought it from home. You’re like, “Nope, that’s so-and-so client paying their bill again.”

Arthur D’Egidio (00:23:40):
They get another month because they brought us some chips and salsa from, it was a restaurant client. They’re like, “We can’t pay you, but here’s some food.” I was like, “Ah, man.” Yeah, those were the days, man.

Pratik Shah (00:23:52):
Yeah, those were the days. So you move into this mortgage company, the back of this mortgage company-

Arthur D’Egidio (00:23:55):
Yeah.

Pratik Shah (00:23:56):
… and you need some help and you start getting some interns from the local law school. Tell me about what you did there.

Arthur D’Egidio (00:24:04):
Oh, this is where things get interesting, because ultimately, so Mike and I, we bring on another attorney, Eric, who we partner up with, who is going to handle a lot of the … He was already doing short sales. So Eric and I worked well together doing the short sale bankruptcy combinations because you get lead from the court, you could then represent the client. You can do these things called leads rift where you could remove the second, so it was a whole thing. I did it, and I was good at it when I was doing it, but I’m glad I’m not doing bankruptcy anymore. It’s a tough gig, and I enjoy representing injured victims and PI cases a lot more than bankruptcy. But for a time there, Eric and I were doing it. So we teamed up with Eric and so it was the three of us and we figured, “Okay, we got a nice little base going.”

(00:24:53):
We start finding our routine, let’s reach out to the … and I was an intern and I’m sure you were too during your law school career. So I was like, “I really enjoyed my internships. I learned a lot. I feel like we can bring someone on and they can help us with some stuff and learn at the same time.” So we brought on Brent who you were friends with and Brent was great. Mike loved Brent. Mike and Brent have a really strong bond. I like Brent too. Eric did too. So he was a great guy. He played basketball with him. He was a great guy and he is a good attorney. So we had our first intern, that was another big moment for us, right? So then you fast forward, we’re like, “All right, hey, this is working out. Why not hire some more?” That’s where lo and behold-

Pratik Shah (00:25:49):
So then.

Arthur D’Egidio (00:25:49):
… Mr. Shah comes in.

Pratik Shah (00:25:51):
So at this point-

Arthur D’Egidio (00:25:52):
You want to take it from here.

Pratik Shah (00:25:53):
… this wonderful intern comes to your office by the name of Pratik Shah and-

Arthur D’Egidio (00:25:58):
Wonderful.

Pratik Shah (00:25:59):
So here’s how this worked out just for the audience, a little background. Brett and I were friends in law school and we were in the same section. We shared notes, all this stuff. We were good friends, we played basketball together, all that stuff. Brent’s telling me, “Man, I’m interning at this law firm right now. These guys are killing it. They’re ballers.” I’m like, “Bro, you got to get me in. Get me an interview. I got to get this job ’cause you love it so much.”

(00:26:27):
He gets me an interview, gives me the office address and I’m like, “Cool.” I roll up, it’s in this little business park. I’m like, “Nice, okay, not bad. I can’t find the suite number because he gave me some suite number or location. I’m like, “I can’t seem to find the suite number.” So I walk into the building that I think is next door to your office, ’cause I’m like, “It’s got to be somewhere in here and I can’t seem to find it.” I’m running late. I’m like, “Oh my God, I’m running late for this interview, this baller law firm.” The lady in the front of the [inaudible 00:26:57] I’m like, “Hey, I’m sorry, I’m a little lost. I’m looking for this law firm.” They’re like, “Oh, yeah. They’re in the back.” I was like, “What?”

Arthur D’Egidio (00:27:03):
In the storage room.

Pratik Shah (00:27:07):
Yeah. I walked past the real estate company, real estate company where you’ve got 20 cold callers just dialing on the phone-

Arthur D’Egidio (00:27:14):
Oh, yeah.

Pratik Shah (00:27:15):
… like boiler room status, walk in the back. Then I think Brett was there that day, and then there’s three offices and three cubicles. Then I could hear Mike and the real estate guy getting into it over something. I was like, “What is going on?”

Arthur D’Egidio (00:27:32):
The relationship with our landlord at the time ultimately broke down, and I think you were a witness to that, but a couple of things there. One, I appreciate how Brett saw us at that time because we weren’t killing it. We were not ballers-

Pratik Shah (00:27:55):
No. No.

Arthur D’Egidio (00:27:55):
We were just figuring it out, but it was just some friends running a law practice and we had each other’s backs. We supported each other through thick and thin. We got it done.

Pratik Shah (00:28:09):
Yeah.

Arthur D’Egidio (00:28:10):
So I can only imagine what you were feeling when you came in and you’re like, “These guys ain’t balling.”

Pratik Shah (00:28:17):
“Where am I right now? Am I in the wrong place?” But it sounds like ever since then it’s been looking up for you. So I’m not going to say it’s coincidence. I’m not going to say that I had everything to do with it, but ever since I interned the business went in a better direction.

Arthur D’Egidio (00:28:33):
That was it. That was our tipping point. We were going to go up down. once you came on board, yes, that everything went up after that.

Pratik Shah (00:28:41):
Yeah.

Arthur D’Egidio (00:28:44):
But no, I think it was you and Justin that started interning with us at that time with. Justin, great guy, I’m still friends with him too. So it was you, Justin, Brent, Mike, Eric and I, and it was fun. It was a good time, and we still were getting the job done. We were litigating cases. I remember you had that, it was that the abuse case that was up in LA and you helped with the deposition. It’s just like we were still doing a good job for our clients. We didn’t have a lot of clients, but we were helping those that we had. In the meantime, I was enjoying the process.

(00:29:27):
It’s stressful. Don’t get me wrong, it wasn’t all fun in games. There was some serious gut-wrenching moments where I was like, “Did I make the right choice? Should I go get a job somewhere?” I’d talked to people who had done it before me and I picked their brains and most of them said, “If you stick with it, you’re going to be happy that you did,” and I am. I am happy that I did. But at the same time, when you’re going through it and you’re bringing home 500 bucks a month at best on the down month, sometimes it ebbs and flows, but you really question your decisions, right?

Pratik Shah (00:30:06):
Yeah.

Arthur D’Egidio (00:30:06):
So it was fun, but it was also stressful, but it was also it was exciting. It was a lot of emotion going on. But yes, when you and Justin and Brent came on, those were good times for me. I enjoyed it. Obviously you and I became friends. I think early on, you and I, we got along pretty well, so it just grew from there.

Pratik Shah (00:30:27):
Yeah. I want to touch on two questions. One, the money question. In those first few years, and I’m only talking about between when you and Mike had the offices in the apartments and for the time that you were in the back of the mortgage company or real estate company.

Arthur D’Egidio (00:30:44):
Yeah.

Pratik Shah (00:30:45):
What would you say was the lowest amount of money you took home in a year during those two periods?

Arthur D’Egidio (00:30:51):
So the first year, I think we made 10 grand each. So I had taken out a little more student loans, and so I put some of that away. It was the post bar loans, so it got me through the bar and all that stuff. But I had put some of that away so that we could have a little bit of breathing room when I was starting the company. Mike, his either fiancé or wife at the time, she was working so she was helping him. But yeah, man, things were tight. I didn’t have the overhead at the firm and I didn’t have the responsibilities to my family that I did back then either, so I was living on a budget, but it was fine. We were making it work.

Pratik Shah (00:31:40):
There’s two types of overhead. Like you said, there’s a business overhead and then there’s the personal overhead. At that stage in your life you don’t have either ’cause you’re not like-

Arthur D’Egidio (00:31:50):
Exactly. Right.

Pratik Shah (00:31:51):
… mortgage or expensive cars or anything like that, and you just need beer money essentially. You’re on an undergrad budget.

Arthur D’Egidio (00:31:59):
Yeah. Yeah. Well, I had my surfboard, I lived by the beach so I could go surf. That didn’t cost me anything. I could have fun there. We were going out in Pacific Beach and networking in that area, so a lot of times there would just be half the sponsored happy hour, stuff like that. I wasn’t living large, but I was still living comfortably. But key, I didn’t have kids, I didn’t have a family, no mortgage, and so I could live off a thousand bucks a month, right?

Pratik Shah (00:32:29):
Yeah.

Arthur D’Egidio (00:32:31):
Obviously rent was a lot cheaper back then, but it was just, you didn’t have that, so I was also able to focus a little more of the cap. We reinvested a lot in the company, so we were taking home less because we were putting a lot more into the company, and that’s-

Pratik Shah (00:32:49):
When you say reinvesting you mean you take that salsa and then give it to somebody else?

Arthur D’Egidio (00:32:56):
Yeah.

Pratik Shah (00:32:57):
Or what do you mean?

Arthur D’Egidio (00:32:57):
We would take the salsa and then we’d give it to our referral sources and then they’d send us more cases.

Pratik Shah (00:33:01):
Oh, there you go. There you go.

Arthur D’Egidio (00:33:02):
That’s the way to do it, but we kept the meatball for ourselves. That was the kick.

Pratik Shah (00:33:09):
That makes sense. No, but [inaudible 00:33:10] go ahead. Sorry.

Arthur D’Egidio (00:33:11):
No, but as you grow, it costs more money, so where do you find it? You can get a line of credit, which ultimately we ended up getting down the road. But it’s just one of those things where you got to feed the machine. You can’t just become complacent. You got to keep feeding it, otherwise, it just runs out of gas, so it’s what we were doing,

Pratik Shah (00:33:31):
Yeah. Okay. You mentioned there were some dark days in those two moments and you started questioning your decisions about whether you were going to make it or if this was your commitment or not. What led to those dark days? Give us an example.

Arthur D’Egidio (00:33:48):
I can tell you an exact moment that is burned in my memory. Probably a low point in my legal career was there was a case we had. It was a lawsuit and a cross complaint, and Mike and I were litigating this one together. I was helping with the business side because there was a defense firm that they had been doing it for a lot longer than us, and they were kicking our butts. I guess they weren’t defense. They represented the other side in their defense and the cross complaint, and so they were just wiping the floor with us. So we grew a lot in that case because we had to step our game up. But we got to about a month before trial and it wasn’t looking good for us. Clients didn’t have money to pay us, the other side had all the resources in the world and we were just getting hammered. There was some bad facts of the case that came out. So I remember sitting in our conference room that was shared with a mortgage company, it was around like 6:30, 7:00 at night.

(00:34:59):
Clients came in and we were probably sitting there talking to them for about an hour or two hours, just about the reality of the situation and how if we can’t figure out some sort of compromise, some sort of settlement that things could go really south at in the trial phase. Dude, they weren’t having it. They were guns blazing. “We know we’re going to win, we know you guys can do it.” No matter what we told them, it wasn’t getting through. It was just a tough situation. I think anyone who’s doing this long enough, who owns their business long enough, you learn the cases that you should say no to. But in the beginning when you’re signing everything, you don’t say no much. So that’s one of the things I learned and what’s, I think, helped us get to where we are today is realizing the cases that you should not take versus the ones you should take. Obviously, you know the ones you take, there’s good cases and there’s not as good cases, but you really want to watch out for the problem and that’s where things get a little dicey.

Pratik Shah (00:36:05):
That’s what I want to jump on. It’s easy when you look at a case to say, “Okay, this is a bad case, I just don’t think there’s a viable case here,” and say no to that. That’s easy. That’s not hard to do. It’s easy to look at a great case and say, “Okay, this is a great case. I want to take on this case.” What’s hard is when you’ve got a good or solid case with a very bad client or a terrible, or a super high maintenance client, that’s the hard one to say no to, ’cause you’ve got, “Hey, this is viable case.” If the bad client has a bad case, easy to say no to. But if the bad client has a good case, that’s where it gets tough. Would you agree?

Arthur D’Egidio (00:36:47):
Absolutely. Thinking about it back then when we were renting out of a mortgage company, we needed money at the time to survive and to keep the doors open and to push the business forward, so that makes that decision even harder when you have a client, you’re telling yourself, “Okay, don’t worry, I can handle this. It might be a little difficult, but whatever.” They’re paying the retainer, there’s a lot of work that’s coming up, we know it’s guaranteed, it’s going to be fine. You don’t realize in that moment what you’re hitching your name to and how it’s going to go. So the more experience you get, you can foreshadow and you can understand, “Okay, I’ve seen this before. I’ve seen this type of client before. I know where this is going to end up in about six months to a year. I’m probably going to try to avoid that and focus on some other better priorities here.” But at the time you don’t know, man, it was tough.

Pratik Shah (00:37:40):
Yeah, you don’t know. It’s also if you are the one that meets with the client and you’re like, “Hey, there’s a decent case and they’re willing to cut me check, but they’re just going to be really tough and I know it, it’s hard to go to your business partners who everybody is struggling and say, “Look, they got a good case and they’re going to pay us, but I just don’t got a good feeling.” They’re going to be like, “Who cares about your feelings? You better go sign that client and deal with it.”

Arthur D’Egidio (00:38:07):
Absolutely. It’s also the fact that you want to go to your clients and say, “Hey, I just got a great case. We’re going to make some money on this. There’s a lot of work, we can do this. We can help these people.” You want to take that news back to your partners, especially on the early days. Even today when you get a big case, it’s exciting, but early on, you’re looking for it. You’re hungry, you got to be. You got to be chasing that. And so you’re always looking for that, unfortunately, live and learn, right?

Pratik Shah (00:38:38):
Yeah.

Arthur D’Egidio (00:38:40):
You learn things the hard way sometimes, and we did. But in the end, that case still resolved. We were able to talk some sense into him, but that was a really dark evening. I remember it was Mike and I in the room, and afterwards I just looked at him and I was like, “What are we going to do?” So I think it was shortly after that I was second guessing my decision ’cause I was like, “I don’t know if I can do this,” but you survive and you do the work. Really, what it comes down to is if you do the work you put in the time, more often than not, you’re going to be all right. In that case, we just took the time and a couple things went our way leading up to the trial, and so we were ultimately able to get somewhat of a decent settlement out of it. But it was a tough road getting there, man.

Pratik Shah (00:39:28):
Yeah. There was a movie one time where they asked people, “What are you afraid of?” The guy says, “Quicksand,” in the sense that sometimes when one thing goes wrong, then another thing goes wrong, then another thing goes wrong, and it’s like that sometimes when you’re in the wrong case. You just can’t catch a break. Defense is pounding you on whatever motions or they’re just catching you left and right on stuff. Your client’s not giving you everything cover you need. The judge is ruling against you, everything’s just going sideways on you and you feel like there’s no rope to hang on to.

Arthur D’Egidio (00:40:05):
Exactly. Again, you are the duty is to the client. You owe them diligent representation, and so you can’t just say, “Hey, sorry, I’m out.” You got to stick with it. You got to do the job.

Pratik Shah (00:40:17):
Yeah. Okay, so let’s fast forward a little bit. So you go from the two apartment office, which I would argue that’s a dual location. You had two locations.

Arthur D’Egidio (00:40:27):
Yes. We were a multi-office law firm at that point, you’re correct.

Pratik Shah (00:40:32):
Then you downgrade to a single location in the back of the mortgage office. How long were you guys there in the mortgage office?

Arthur D’Egidio (00:40:41):
I think we were there for about maybe two years.

Pratik Shah (00:40:44):
Okay.

Arthur D’Egidio (00:40:50):
You remember the old office, right?

Pratik Shah (00:40:51):
Yeah.

Arthur D’Egidio (00:40:52):
So it was a motel that had been transformed to a commercial office. So at a certain point the relationship broke down with the person who owned the mortgage company. So we’re like, “Look, we can’t stay here anymore. Every day we’re coming in, it’s a hostile environment, we got to get out.” So we just found it a cheap office and the landlord was great. It was already a shell so that he built it out for us. Looking back on it now, it was super ugly, but it worked for us. Our design was terrible.

Pratik Shah (00:41:28):
Right.

Arthur D’Egidio (00:41:28):
We couldn’t decide paint, we couldn’t decide anything. You remember those days?

(00:41:31):
Yeah.

Pratik Shah (00:41:34):
We thought, “What is a law firm supposed to look like? Mahogany furniture, leather chairs, stuff like that?” So we got it all dirt cheap and it looked cheap, but this is what we thought an office was supposed to look like.

Arthur D’Egidio (00:41:51):
Yeah.

Pratik Shah (00:41:52):
Now everything’s a lot more modern, you have the nice LVP wood floors, the lighter colors, everything’s more modern. But we were like, “Okay, what is a law firm supposed to look like”? You live and learn, man. We figured it out.

(00:42:05):
Just for the record, it was a motel that got turned into an office, but that makes it sound worse than it was. It wasn’t bad. There were a lot of other business owners there.

Arthur D’Egidio (00:42:12):
Yeah, it wasn’t bad.

Pratik Shah (00:42:13):
There was an accountant. Who was the other guy next to us? The real estate agent or something like that. It was not bad.

Arthur D’Egidio (00:42:20):
Yeah, there was a real estate company. There was two accountants. There was an insurance agent, so it was a legitimate commercial building, but no elevator.

Pratik Shah (00:42:31):
No elevator.

Arthur D’Egidio (00:42:31):
There was two levels of stairs, so that was a problem with clients who had been for injury clients. It was, again, a stepping stone. We went from the apartment to the sublet to our own office. Again, we were very proud of it because it was ours. I think we had to put 5,000 down for first and last month’s and some TIs or some furniture and stuff that were our own. That was a lot of money for us back then. Right?

Pratik Shah (00:43:05):
Yeah. Yeah.

Arthur D’Egidio (00:43:06):
So we were able to do it and we set it up and we had our own space, and that was our first real office. Obviously I have fond memories of it, but look, I would never go back to that. It was again, a stepping stone, but happy to be where we’re at today.

Pratik Shah (00:43:28):
And not getting into it with the landlord every day. So let’s switch gears a little. Let’s talk a bit about hiring mean. Obviously you had a couple of interns at the old office, and you started at some point realizing, “We’re just not going to be able to build this firm off of just interns.”

Arthur D’Egidio (00:43:44):
Correct.

Pratik Shah (00:43:44):
What did you do there?

Arthur D’Egidio (00:43:45):
Right. Essentially, the caseload starts to grow and then we start to narrow in our practice areas. So I was probably doing about 75/25 bankruptcy to personal injury at that point. We probably had about 50 to 100 personal injury cases, and it’s hard to do that when it’s just you. Then Mike and Eric had there litigation cases as well, so we needed a paralegal. So we looked at, just put an ad up on Craigslist and interviewed and we were ultimately able to find our first paralegal. That was someone who answered the phone, took in our mail, did all the admin stuff while at the same time, doing discovery, doing the motions, just helping wherever that was needed.

(00:44:41):
So that was another big step for us because now we had payroll. Now we had someone we actually had to pay for, and our overhead starts to increase a little bit. You got your rent now. You got payroll now. You got all the miscellaneous mail and your energy bill, cable, ethernet, all that stuff, so now our overhead’s starting to increase. But I think that’s part of the growing process is that you need to. If you’re going to remain stagnant, then you’re just going to stay in the same place. If you want to grow, that’s part of growing, but still it’s stressful, and so we were able to pull it off.

Pratik Shah (00:45:24):
Yeah. So you hire through Craigslist. Does that first employee work out? How long was that first employee with you?

Arthur D’Egidio (00:45:34):
So the first employee was with us for a while longer-

Pratik Shah (00:45:37):
That’s great.

Arthur D’Egidio (00:45:37):
Longer than they probably should have.

Pratik Shah (00:45:39):
That happens.

Arthur D’Egidio (00:45:42):
But it was another gentleman that in the beginning he was a good fit for us because he had experience doing personal injury, he had experience in civil litigation, so we knew what he was doing. Ultimately, it was more of an attitude thing as opposed to skills-

Pratik Shah (00:46:03):
You outgrew him.

Arthur D’Egidio (00:46:06):
Well, it was one of those things where he wasn’t really a team player, and you’re right. As we grew and we started to bring on even more staff members, and I think you came along about a year or two after that, then our paths merged up again. How many staff members did we have then? Do you remember?

Pratik Shah (00:46:30):
When I joined, so just a little background, I was an intern. I left, I went and started my own career and started my own firm. It was maybe about three years later that we came back together to try to work together and figure out a way to work together. When I started, I think it was just James, and we ended up hiring one more because we had so many more cases, once you guys were [inaudible 00:46:54]

Arthur D’Egidio (00:46:54):
Right, because you had your whole book of business. So when we merged, there’s no way that one paralegal could handle it. So I think we had some law clerks and we had some interns at the time, but we needed a full-time staff member. Is that when Tanya came about?

Pratik Shah (00:47:10):
No, we had the other guy that we-

Arthur D’Egidio (00:47:13):
Ohm I can’t remember his name-

Pratik Shah (00:47:17):
But again, even back then we saw those-

Arthur D’Egidio (00:47:20):
John?

Pratik Shah (00:47:20):
I think it was John, but we saw those issues between-

Arthur D’Egidio (00:47:23):
Yeah, right.

Pratik Shah (00:47:24):
… the staff members. In the beginning you were like, “Oh, maybe it’s something we can solve. Let’s figure it out,” and then John didn’t work out.

Arthur D’Egidio (00:47:30):
Right.

Pratik Shah (00:47:31):
Then we bring on staff members and the same thing keeps happening, and you recognize, “Oh, we realize what the problem is now.”

Arthur D’Egidio (00:47:42):
Now we’re getting into the phase of-

Pratik Shah (00:47:44):
Growth.

Arthur D’Egidio (00:47:44):
… but I’m not just a lawyer, I’m now a manager. So as you grow, you start wearing more hats where you’re representing your clients, but you’re also managing people. They don’t teach that in law school. There should be a course on how to run a law firm, but there wasn’t there when I was going, but maybe it is now. I don’t know. But they don’t teach you how to manage people, how to manage the law firm, how to manage the trust account, which is a big one. You really need to know these things and you learn or you have to learn. But when you start having conflicting personalities at the office, what do you do? It’s not like you’re a big corporation where you can say, well, you bring in HR and you have them sit down with everybody. You put on your HR hat and you’ve got to sit there and deal with it.

(00:48:37):
Sometimes it’s like raising children or babysitting where you’re just like, “All right. So-and-so left a mess at the desk and they didn’t mean to. It wasn’t on purpose, it wasn’t intentional,” but you’re just dealing with people. So through our growth, we found out who fit our company and who was a good fit and who wasn’t. I think we got to a place a few years ago of just having a nice team that blends well together and everyone supports each other. There’s no drama. That’s huge for me, right?

Pratik Shah (00:49:12):
That’s the dream. Yeah.

Arthur D’Egidio (00:49:13):
I just want to make sure that everybody’s happy. That’s really what it comes down to.

Pratik Shah (00:49:17):
Yeah, but here’s the other question is, you’re doing personal injury. It’s been about three years now ’cause it was six months at the two apartment place, two years at the mortgage place. You have your own spot in Kearny Mesa now, so you’re at the three-year mark, three-and-a-half year mark. How long were you in the Kearny Mesa spot?

Arthur D’Egidio (00:49:44):
We were probably there for another two to three years.

Pratik Shah (00:49:50):
Okay.

Arthur D’Egidio (00:49:51):
I think we’ve been at this current office for about five, so give or take three years.

Pratik Shah (00:49:56):
You’re almost five, six years in something like that at the Kearny Mesa spot-

Arthur D’Egidio (00:50:00):
Right. Right.

Pratik Shah (00:50:00):
… in total at this point in your career. But the whole time, like you said, the caseload is growing, so that means you’re still getting all your business from networking, right? You guys aren’t running ads or anything, are you?

Arthur D’Egidio (00:50:10):
Right, no marketing whatsoever.

Pratik Shah (00:50:13):
Right.

Arthur D’Egidio (00:50:13):
I think we barely even had a website. We finally got a website.

Pratik Shah (00:50:18):
Right.

Arthur D’Egidio (00:50:18):
The first website was terrible. I think Mike made it on WordPress. It was awful-

Pratik Shah (00:50:24):
You just have to figure it out, and-

Arthur D’Egidio (00:50:25):
We had it. It was there.

Pratik Shah (00:50:26):
… and that’s a function of not having the budget for being able to compete-

Arthur D’Egidio (00:50:28):
Correct.

Pratik Shah (00:50:29):
… in the marketing space.

Arthur D’Egidio (00:50:29):
Correct.

Pratik Shah (00:50:30):
… for personal injury. You’d just be throwing money away.

Arthur D’Egidio (00:50:33):
Well, but the AdWords weren’t as big back then. Facebook ads were just starting. It was a different playing field back then too. So obviously a lot’s changed, and just like you were doing, it’s just personal relationships. I don’t know if this is the right term, but is it B2B, right?

Pratik Shah (00:50:53):
Yeah.

Arthur D’Egidio (00:50:53):
One business to another business where we’re helping each other out and I’m creating a relationship with an individual who I can send them cases to, they send me cases, and we all work together. Clients are happy, so they keep sending them, that’s really how we were able to grow.

Pratik Shah (00:51:08):
Right, and so-

Arthur D’Egidio (00:51:09):
I know it was the same for you.

Pratik Shah (00:51:10):
Yeah, for sure. But this is the question that I’m coming to is, you’ve been out there hustling for four or five years. You’ve been growing, you’ve got a good reputation, your Yelp reviews are good. At this point, you’re doing personal injury almost exclusively, you said you’re about 80%. You must just be getting tons of seven figure cases.

Arthur D’Egidio (00:51:31):
Oh yeah, tons. That’s all we were getting at that point. No man. Dude, you’re talking, I think I remember settling one for 85,000 that was, and I was like, “Oh my God, that’s such a big result. I can’t believe they paid that.” Now that’s like, “Okay, great. Now onto the next one, right?”

Pratik Shah (00:51:53):
Yeah.

Arthur D’Egidio (00:51:54):
But I remember we got a big case. It was a motorcycle accident and the at-fault driver had a 250 underlying and a million dollar umbrella. This is the first time I’d handled the case this large. I did talk to some of my mentors about, “Oh my gosh, want to make sure this case gets all the attention that it needs so that we get the absolute best result for the client.” I remember when I signed the client, he was a really good guy. He skied, he’s surfed, all the stuff that I like to do. So him and I really created a bond, and him and I still to this day are friends, but I would do anything for him. I helped him. He had some issues with his dad. He was living at home and one day he called me and he is like, “Art, I’m at really low point right now. I need some help. My dad’s kicking me out of the house,” and his leg is all messed up, and so he can’t move on his own.

(00:53:00):
He was like, “I got no one else to call.” So I said, “Don’t worry, man. I got you.” So I get in my car. I drive over there, load up the car with all this stuff and drive him over to one of his other buddy’s places, unload it, set him up. I’m like, “You good? Do you need anything else?” He’s like, “No, I just really appreciate you.” So no matter whatever he needed, he got it from us. So that was a case and a client who, again, still is very dear to me because we ultimately got the full policy. He was very happy. He was very grateful throughout the process, but he was also just a good guy. He was one of those clients where he was very respectful, respectful to the staff. Sometimes it doesn’t always happen, but he was also very appreciative and very thankful, so it was mutual in that respect. But that was what, six, seven years in-

Pratik Shah (00:53:55):
Seven years.

Arthur D’Egidio (00:53:55):
… until I got a case of that size. I think before that we had settled one for, I think it was 450, and I was like, “Oh, my gosh. I can’t believe we were able to get this.” That was a heavily-litigated case against a well-respected defense firm out here, and it was just me. I remember getting a life care plan. I had to spend 10 grand getting a life care plan. I was like, “Oh, my gosh.” I was tripping because if the case didn’t settle in mediation, we had some serious costs coming up for trial and we were going to have to probably look outside the firm to get some funding to figure out what we’re going to do. But the case settled and the client was thrilled. She’s also a friend to this day, but it’s just, you figure it out, man. You do what you got to do.

Pratik Shah (00:54:42):
Yeah. It’s really interesting how stuff scales, because we’ve heard that 10 grand number now twice. One was, that was the amount you made in an entire year, in your first year of running law firm, and now you’re spending it on one part of one case.

Arthur D’Egidio (00:54:55):
Exactly.

Pratik Shah (00:54:57):
You just have to get comfortable with that stuff as you grow. I got to imagine that must have been really painful to get that invoice from the life care planner that’s at that moment and say, “Oh, it’s 10 grand.” That’s a partner meeting type of time,” which is to say, “We got to talk about this.”

Arthur D’Egidio (00:55:11):
Exactly. Exactly.

Pratik Shah (00:55:12):
“What are we doing here? What’s the plan?”

Arthur D’Egidio (00:55:16):
It was one that I paid, I put three grand for the retainer and then they sent us the bill for the remaining seven. So I talked to them, I was like, look, “I’ll pay you two now. Two next month,” so we figured it out. Then the case settle and I paid off the balance. But yeah, you got to figure it out. It’s not difficult if you put in the work, but it is stressful because your clients are relying on you. If you’re not willing to go all the way, they’re not getting good representation, and so you got to be all in, right?

Pratik Shah (00:55:57):
Yeah.

Arthur D’Egidio (00:55:59):
If you’re not going all in and you’re just starting a practice, I don’t think it’s going to work out. You’ve got to be 100% committed.

Pratik Shah (00:56:08):
Then at some point you had a fourth partner.

Arthur D’Egidio (00:56:11):
Yes, and he was all right. He wasn’t that great. But no-

Pratik Shah (00:56:14):
It didn’t work out.

Arthur D’Egidio (00:56:14):
Yeah, it never works out. So what happened is when you brought your cases on, it was ultimately like, “Okay, you’re going to be an associate and you collect a base, plus what was a percentage of the cases that you brought in.” So at a certain point you’re like, “This isn’t really working out. I want to have my name on the door.” I remember I was talking to one of our former partners, he’s like, Oh, the audacity, how could this be? How could come out with this demand?” I was like, “Dude.”

Pratik Shah (00:56:58):
I wouldn’t say I made a demand. You brought it up.

Arthur D’Egidio (00:57:02):
Well, yeah. All right, but that’s-

Pratik Shah (00:57:03):
I was leaving.

Arthur D’Egidio (00:57:04):
No, I don’t think you were making a demand. You were saying, “It’s not working out.” I was like-

Pratik Shah (00:57:10):
Yeah.

Arthur D’Egidio (00:57:11):
But I saw the potential and I saw, you were out. Really, what it came down to was personal injury, that was doing the best for us. Personal injury is where we were paying the bills, we were making money, that’s ultimately what became our focus because we were doing well there. Some of the other partners didn’t want to do that. So I knew when you came in, I was like, “Oh great, someone else is doing PI. I can work with Pratik. We can work cases together. We can figure out strategies, and he also has a good caseload. This is going to be great for us.” So I knew that for us to grow that it would’ve been stupid not to have you as part of the practice. When you said that, I think I asked you, I was like, “Well, what is it going to take?

Pratik Shah (00:58:00):
Yeah.

Arthur D’Egidio (00:58:00):
‘Cause I think you came to me and you were like, “You know what? It’s not really working out.”

Pratik Shah (00:58:02):
Yeah.

Arthur D’Egidio (00:58:02):
I was like, “All right, well, what’s wrong? What do you need?” He is like, “I think I want to have my name on the door. I think I want it to be mine.” I was like, Well, why not? Let’s just slap it up there,” and you got it, right?

Pratik Shah (00:58:15):
Yeah. Yeah. That’s how I remember it as well, was I was just like, “I’m not saying I want my name on the door here, I just want my own thing. I want to own it”. Then you were like, “Well, why don’t we just do that with us?” I was like, “Well, yeah.”

Arthur D’Egidio (00:58:28):
Right.

Pratik Shah (00:58:28):
“I’m open to that.”

Arthur D’Egidio (00:58:30):
‘Cause I think you were like, “Is that an option?”

Pratik Shah (00:58:32):
Yeah.

Arthur D’Egidio (00:58:32):
I was like, “I think so. Let me talk to the other partners.” That’s when there was a conversation with one of them. They’re like, “No, there’s no way. How could you do that?” I’m like, “Honestly, guys, this is a business decision. You got to take the emotion out of it. This isn’t personal. If this is what makes more the most sense for the company, then we need to do it,” and then ultimately-

Pratik Shah (00:58:56):
It worked out.

Arthur D’Egidio (00:58:57):
We did and it worked out. We hit another big case, the Gaspar case, so that was a big one that we hit. Then you had a couple of hits that year.

Pratik Shah (00:59:05):
Yeah. Yeah.

Arthur D’Egidio (00:59:06):
Then we were able to move into a much nicer office, and it’s where currently located. When we started hitting some of those big PI cases, again, we reinvested in the firm. We brought on more attorneys, probably more than we needed because they were doing a lot of the business stuff. It didn’t really make financial sense, but we really went hard in staffing and investing in the company and growing it around us. So when you came on, it was nice because I was learning from you on some of the litigation and the trial stuff. We were able to collaborate a lot. It was good there. Then when we-

Pratik Shah (00:59:49):
We figured out what each other’s strengths were, right? We were both-

Arthur D’Egidio (00:59:53):
Exactly. Right.

Pratik Shah (00:59:54):
… taking caseloads, half pre-lit, half lit or whatever. Then eventually it was like, I did not enjoy doing pre-lit. Obviously it makes sense, it needs to be done the right way and it needs the right amount of attention. But I just didn’t enjoy dealing with the adjusters and it just wasn’t my thing. Then we eventually-

Arthur D’Egidio (01:00:10):
No, you hated it.

Pratik Shah (01:00:10):
I hated it. I hated it.

Arthur D’Egidio (01:00:12):
We used to talk about it. Yeah, you hated it.

Pratik Shah (01:00:13):
It’s the worst, ’cause I would just get pissed and I would just say, “You know what? We’re just going to file.” You would be like, “Look, we can work with this. Let’s negotiate here.” I was like, “No, they’re being unreasonable. We’re just going to file. We’re not dealing with this.” So then eventually we split it up where you did all the pre-lit and I did the lit and that worked out well.

Arthur D’Egidio (01:00:30):
Yeah-

Pratik Shah (01:00:30):
But then over time-

Arthur D’Egidio (01:00:32):
Yeah, go ahead. Well, and ultimately we made that decision and it freed us up because you could really just focus on the litigation stuff, the discovery, the depos, all the stuff that needs to happen in lit; whereas, I was running probably what, 200?

Pratik Shah (01:00:48):
Yeah.

Arthur D’Egidio (01:00:49):
Probably 150 to 200 cases in pre-lit because I don’t have those hard deadlines. It’s not as time consuming. So it freed me to do my part and then it freed you to do your part. It was a model that, I think were just talking one day and it’s like, “Let’s just try it out, see how it goes,” ’cause I was like, oh great, I don’t have to do discovery anymore.” Now this is before Esquire Tek, which that changes things, but which hey, it’s been great for us. So we still have that model in place.

(01:01:18):
But with using more of those automated systems and just having a nice software program that helps with our clients, it’s like there’s tools out there that you learn also along the way that help you run the business. That’s what I’m saying, you don’t know all that right away. You learn it as you grow, but as you learn it, and if you’re not as resistance to change as that I am, I have things set a certain way and I like doing them that way. But I’ve come around, you got to admit, I’m coming around a little bit.

Pratik Shah (01:01:50):
Hey, everybody has to adjust as they go. For me, I have entrepreneur ADD sometimes where it’s like, “Oh, let’s go try this new thing. It’s going to solve all our problems.” But the reality is not always, sometimes it just causes more problems, and you need to just work the thing that you have and not try to go for a new thing, ’cause when you look online, it makes you feel like somebody’s got a secret out there that you don’t know about, and that’s what it is and I need to go buy that and I need to go do that, and that’s just not necessarily true.

Arthur D’Egidio (01:02:23):
I think that’s one of the negative things about social media is that you go on social media and you see all these things that are being thrown in your face that’s like, “Oh, sign up for this plan and you’ll succeed immediately.” There’s no overnight success story. It all takes work, and you got to just grind it out and you got to do the job and put in the time. I think social media creates an image of success that is a little bit false. Whereas, you think people are just an overnight success, but you don’t see what’s going on in the background.

(01:02:59):
You don’t see what it took to get there. I know there’s other lawyers and other attorneys who have talked about this where, and someone made this analogy. It’s like Facebook or Instagram or whatever the social media platform is, that’s what people look like, dressed up in a tuxedo. You don’t see someone when they woke up getting out of bed in the morning going to work, no one’s posting that. Everyone’s posting at their best. So the reality is we’re all in it. We’re all fighting, we’re all doing our thing and we just got to stick with it.

Pratik Shah (01:03:29):
Yeah, so you’re right, you got to stick with it. So you’re in this new office, a higher overhead. You’ve got three partners now, Mike, myself. Now where you’re at is you are in the same office, but now you got a whole different partner in Irving Pedroza. What happened?

Arthur D’Egidio (01:03:49):
Correct. So you fast forward and ultimately, once we started doing well, once we start having some success in these cases, it becomes a little more tense because you have a little bit of a rivalry of, “Okay, where should the business now go? Now we’re learned, we’ve grown, we’re making sound business decisions,” and you need to be on the same page; otherwise, that ain’t going to happen.

Pratik Shah (01:04:21):
You’re not getting your cases from the recreational basketball league anymore.

Arthur D’Egidio (01:04:26):
We ain’t playing ball anymore.

Pratik Shah (01:04:27):
Exactly.

Arthur D’Egidio (01:04:27):
We don’t have time for that anymore.

Pratik Shah (01:04:28):
That’s right.

Arthur D’Egidio (01:04:29):
That’s what I’m saying. Those are the good times of the old days. I can go play basketball in the middle of the day, can’t do that now. I wish. So basically you got to make these decisions as to how the practice is going to run. You and I both know that personal injury was doing pretty well, and so we were all in. We were all in doing personal injury like that’s where we wanted to focus our attention. There was a difference of opinion, and so one thing led to another and people went separate ways. So then it was just you and I, right? So it was you and I all in doing personal injury. Then we added the property damage practice as well, because you’re still dealing with insurance companies and it’s a similar practice area. So, you and I, think it was just the two of us, maybe for what, like two or three years?

Pratik Shah (01:05:17):
Yeah.

Arthur D’Egidio (01:05:18):
We had a staff, so it was Irving, it was Megan ultimately came on board. We have a dynamite support staff with our paralegals, so we’re rocking and rolling. So everything was going good. Obviously there was an opportunity that came by, so you took the opportunity. Irving was the natural choice because he’s doing all the stuff that you were doing with the litigation and handling the litigation clients while, I’m basically managing the office and handling the pre-lit, so.

Pratik Shah (01:05:52):
Whoa. Whoa. Whoa.

Arthur D’Egidio (01:05:53):
We’re streamlined.

Pratik Shah (01:05:54):
Are you trying to say that I was easily replaced?

Arthur D’Egidio (01:05:58):
No, but we had to do something-

Pratik Shah (01:06:01):
‘Cause that’s what it sounds like.

Arthur D’Egidio (01:06:05):
All right. All right. After I was my month of crying in the office after you left, so after that, after I came to grips, once I started getting out of bed again, then we had to make the decision.

Pratik Shah (01:06:16):
All right That makes me feel better.

Arthur D’Egidio (01:06:20):
No, I skipped over the mourning period. So once-

Pratik Shah (01:06:23):
You’re like. “Oh, yeah. Monday, he left Tuesday, we were good to go. No big deal, worked out great.”

Arthur D’Egidio (01:06:30):
No, no. Come on. You know that’s not true, man. No, we’ve talked about this, but again [inaudible 01:06:37]

Pratik Shah (01:06:37):
You still got payroll, you still got clients that need to be serving.

Arthur D’Egidio (01:06:39):
Exactly.

Pratik Shah (01:06:40):
You still got staff that are looking to you for leadership. When something like that happens where a partner in the business leaves, ’cause when you and I were partners, we had two partners that we had to separate from for various reasons.

Arthur D’Egidio (01:06:51):
Exactly.

Pratik Shah (01:06:52):
That’s still a conversation you got to have with your team and say, “Guys, don’t panic. Don’t start looking for other jobs. Everything is good. Business is still flowing. Payroll’s still going to get hit. This happened. You have to just let it go and just keep working on your jobs. Our clients still need representation,” and that’s the truth at the end of the day, no matter who leaves, right?

Arthur D’Egidio (01:07:11):
Correct.

Pratik Shah (01:07:11):
No matter what they contributed, it doesn’t matter.

Arthur D’Egidio (01:07:14):
Right. Any business, no matter how large or how small it is, the day-to-day operations or year-to-year, you’re going to be throwing curve balls. Things are going to change. Look what’s going on on Twitter. Twitter, monster company, Elon Musk comes in and buys it, shakes the whole thing up. It can happen to anybody, but you have to have an infrastructure in place. You have to have a good support system. I think as long as you have that you can build and you can grow on that, right?

Pratik Shah (01:07:45):
Yeah.

Arthur D’Egidio (01:07:46):
There’s books out there. We’ve talked about traction and fireproof, which I think give a lot of good … They give some advice and they give you some tips at how to run the practice, but eventually, you got to make it your own and you got to find what works for you, right?

Pratik Shah (01:08:01):
Yeah.

Arthur D’Egidio (01:08:02):
I’m still learning. I’m still figuring it out. When we were no longer working together that, and you and I talked about this, I had to really make a gut call like, “What do I do? Do I just go, ‘Is it just me or do I bring on another partner?'” Irving is a natural choice. He’s great. He’s a great attorney. He knows his stuff, and it allowed us to continue what we’re doing without skipping a beat. Now again, nothing to say that

Pratik Shah (01:08:34):
I know, I’m just teasing.

Arthur D’Egidio (01:08:35):
I’m not saying you were easily replaced, but we had to do something.

Pratik Shah (01:08:38):
Yeah. Yeah. Yeah.

Arthur D’Egidio (01:08:40):
Yeah, so that was the natural choice. It’s been great. We’re doing our thing. Our clients are still getting serviced, we’re doing what we need to do. One, it’s because you of the things that we’ve learned from the past, and two, it’s understanding the trade. I think also from where we started, taking every different type of case, every different type of law, and now focusing on a specific type, we can really just get good and perfect that one type of practice. That helps us, the helps the client, it helps us get results. That’s really what we’re trying to do now, but we didn’t start there. We had to go through a lot to get there.

Pratik Shah (01:09:21):
So a couple more questions and then we’ll wrap up here.

Arthur D’Egidio (01:09:24):
Sure.

Pratik Shah (01:09:24):
This was a lot of fun. In the 12 years you’ve been running your practice, you mentioned a couple of tough points in there, but what would you say was probably your hardest day?

Arthur D’Egidio (01:09:39):
Aside from that story I had told you before, the hardest day was it was probably the partner separations. So it was yours, but the other ones as well, because things change so much. Yours wasn’t as bad because you and I were on good terms and we had everything, it was a pretty smooth transition. You were very helpful. But when you have ones that aren’t as amicable, dude, those are tough. You don’t know what’s going to happen. Is the business going to get held up? It’s like a divorce, it’s a business divorce, and so those were probably the hardest for me.

Pratik Shah (01:10:30):
And [inaudible 01:10:31]

Arthur D’Egidio (01:10:31):
So choose your partners wisely.

Pratik Shah (01:10:33):
Yeah. Yeah. So the next question is, in 12 years of running a business and from where you’ve gone from the beginning to where you are now, speaking specifically to where you are now, running a business, having all the stuff of being a business owner and being a lawyer, what do you think is the worst part of running your own practice?

Arthur D’Egidio (01:10:56):
The worst part of running the practice is dealing with all the admin stuff that’s required. As you grow and as you start doing more, whether it’s marketing, payroll, HR, all your insurances, health insurance, disability insurance-

Pratik Shah (01:11:13):
Workers’ comp.

Arthur D’Egidio (01:11:13):
… your 401k, work comp, it’s almost a full-time job just keeping all the admin stuff up to date, which is why we recently … Obviously when COVID happened, we didn’t need as much staff, so we downsized a little bit, but we’re back to a full capacity now. We just hired someone new to help with a lot of the admin stuff because oh man, it’s hard to do all of that and still be a full-time lawyer. That’s probably the hardest part of managing the company, which is why, and this is what Fireproof and Traction talk about, is delegating those tasks, right?

Pratik Shah (01:11:48):
Yeah.

Arthur D’Egidio (01:11:49):
So I think that’s a big part of it is building a team, a good support system because then it makes your job easier. If someone else said, someone that’s smarter than me, delegate the stuff that you don’t like to do and focus on what you’re good at, and I think that’s important. If you can hire people that are smarter than you, that are better than you at the things that you’re not good at, so that they can take those tasks and you can just focus on your skills.

Pratik Shah (01:12:11):
Yeah. Love that. Love that. One thing we’ve all heard about during this conversation here is you’ve had a lot of partnerships and a lot of partners, but the consistent one has been you. So does that mean you’re the problem?

Arthur D’Egidio (01:12:26):
Probably, yes.

Pratik Shah (01:12:27):
I’m just kidding. I’m just kidding. No, I’m just kidding. I’m just kidding. No man, you were a great business partner. I enjoyed my time with you.

Arthur D’Egidio (01:12:38):
Well, it depends. Well, I don’t know, man. You might want to have my wife on the podcast. I’m sure she might agree with you.

Pratik Shah (01:12:42):
No, not at all. Not at all. I’m just totally joking. But one of the questions I always ask people, ’cause I think it gives us some real insight, is if you could go back to those early years, like 2010, ’11, you were starting out and let’s say you could go back in time and you could talk to the younger Arthur and you couldn’t tell him that you were the future, you had to give him some advice. What advice would you give him?

Arthur D’Egidio (01:13:08):
I would’ve told him to go hard on the online marketing because back then it wasn’t as big as it is right now. Now it’s so competitive. It’s crazy where it’s gotten to, but back then it was just starting out, right?

Pratik Shah (01:13:20):
Yeah.

Arthur D’Egidio (01:13:20):
So knowing obviously what you know now then, I would have a huge leg up, because the online presence would be so big. But aside from that, more of on a philosophical approach, I would tell them be careful who you hire, because hiring the right person and building the right team is so critical to running the practice the right way. If you have the wrong people in the wrong places, it’s not going to go well.

Pratik Shah (01:13:52):
Yeah. Yeah. I think that’s great. I think that’s a great place to end. Arthur, thank you so much. Really appreciate you being on, man. Really appreciate your friendship through the years and working with you, you were a great business partner. I was just joking.

Arthur D’Egidio (01:14:04):
Yeah, thank you. I appreciate that.

Pratik Shah (01:14:07):
For everybody else, thanks for listening or watching. We’ll see you in the next episode of Bootstrapped Solo. Remember, just because guys like Arthur make it look effortless, it doesn’t mean that it is. For all of you that are out there and you enjoyed the podcast, if you feel like you learned something or you got some value out of it, please feel free to share it on LinkedIn, Instagram, TikTok. We can only grow the podcast and get other great guests if you share it and let people know about it. Thank you guys so much. Arthur, thank you again and I’ll see you soon.

Arthur D’Egidio (01:14:35):
Thanks, Pratik.

 

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