Building a White Collar Boutique, with Arlo Devlin-Brown

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Yeah. When I think of number

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Hello, everyone. Welcome to the Elawvate:

Build and Grow Your Law Firm podcast.

I'm Jeff Wright, chief operating

officer at Gideon Asen. As always,

our host, partner, owner, Ben

Gideon. Good morning, Ben.

Morning, Jeff. How are you today?

I'm good. Well, usually Ben and I

do a little banter at the beginning,

but I'm excited for our guests today.

Yeah, me too. Well, you do the

introduction, I'll do something.

All right.

Go for it.

I look forward to that. So today

we're joined by Arlo Devlin-Brown,

former federal prosecutor, US

Attorney's Office in New York.

Currently managing

principal at TDB Law Firm,

a boutique white collar

firm in New York City.

That's your most recent foray

into the legal world with,

I believe, your partner

Tim there. Welcome, Arlo.

Thank you. Good to be here.

Good to have you.

So the part of your bio you left out

was Arlo and I were co-clerks together

back in 1999 / 2000 era, right? Yeah.

We met clerking on the first

circuit in Portland, Maine,

and Ben introduced me to

everything Maine had to offer.

And then after working with me in New

York City for a couple years after the

clerkship went back to his home state,

he's made a little something

of himself since then.

And also after our clerkship,

we took a little trip.

Arlo and I spent about a month

in Nepal doing a track around the

Annapurna Circuit. Amazing experience,

actually. I still think about it a lot.

Yeah, that was one of the best

trips I've taken in my life.

And it was sort of a

reminder to everyone. I mean,

that was a time we had sort of between

jobs, right? We're ending a clerkship,

starting something new.

And for anyone who has that opportunity

to take a month or something before they

have to do something else where you

don't have to bring clients with you or

something like that, take

that opportunity. You're not

going to regret it later.

Yeah, for sure.

A lot of times people interview

for jobs with us and ask if they're

leaving another job, it's okay if they

take a little time between the jobs.

And I always encourage people, "Yes,

you should take time." It's the only

time that you can have time off without

having to worry about other

responsibilities or stuff

going on at the office.

So after our memorable clerkship

and our month in Nepal together,

Arlo's had a meteoric career where

he's done all kinds of very impressive

things. Whereas I just came back to Maine

and became an ambulance chaser lawyer.

Can you just give us a thumbnail sketch

of your career and just some of the high

points of it before we

get into your new venture,

your law firm and what's gone

into starting and building that?

Yeah, absolutely. So leaving my clerkship

and probably even a little before,

I had thought maybe it would be

fun to be a federal prosecutor.

You get to do cool cases. And

I was going to go to New York.

The Southern District of New York

had a great US attorney's office,

often does sort of very

high profile cases.

You can't go straight there from

law school for the most part.

So I worked as a associate at a

law firm in New York for about

five years, had a great experience,

had a couple mentors there who

were former federal prosecutors.

Two of them are now federal

judges in Manhattan.

And through that experience

and their kind words about me

was able to get a job in the US Attorney's

Office. I stayed there for 10 years.

I think every time someone

would ask me, I would say,

"I'll stay another two years."

And then a decade happened,

but it was such a wonderful place to work.

I did everything ranging from

organized crime cases to being a

member of the securities fraud unit,

getting involved in some of the Madoff

related prosecutions and some big hedge

fund insider trading cases.

I was then about to leave and was

asked to stay to be chief of the Public

Corruption Unit.

Public corruption used to still be

a crime back then and stayed for two

years and had a great experience. I.

Think public corruption

is now a department of the

United States government,

right?

Yes. I went to Covington and

Burling, fantastic large law firm.

I was a partner in their white collar

investigation space for nearly a

decade.

And then I just got a little bit of a

bug in me to try something different.

Covington was wonderful,

but just turned 51 and wanted to

try something else. So I started a

law firm with my friend, Tim Treanor,

who I knew from the US Attorney's

office and seen around.

And he had just left Sidley,

another large law firm a few months

earlier and it's hung out his own shingle

and we started talking. And six

months ago, we started our firm.

So tell us a little bit about how

did that conversation unfold? I mean,

it's a big decision to leave a secure job,

a big prominent firm

where I'm sure you had a

dependable source of business,

secure opportunities, and obviously

compensation opportunities there.

So leaving all that to just hang out

your own shingle and start your own

practice, that's a big move.

Talk a little bit about the discussions

you had around that and the thought

process. Yeah.

So it was very personal for me. And

Covington being a law firm partner

at a large law firm is a very well

compensated job.

And it's a fairly secure job if

you're not putting in some effort.

And I could have stayed there, I

think, and in 15 years or something,

retired and said, "Okay,

that was a fine career." But you

really do get a sense of number one,

you're not going to be here

on this planet forever.

You're not going to be able to try

other things in a different life.

And I wanted to challenge myself. I wanted

to do something I hadn't done before.

And I think in terms of risk taking,

I think we lawyers, maybe less so you,

you're a plaintiff's lawyer,

so you're doing a lot of contingent

fee work where there's risk,

but I think we tend to, as a profession,

overestimate the risk of

taking new business steps.

And I think on your podcast,

Ben, actually,

you had a guest or maybe you remember

the statistic about small businesses

failing very frequently, and

that's not true for lawyers.

And so I wasn't really

worried about failing.

I have a lot of people

who refer cases to me.

I have a good reputation as a lawyer.

And so I went into this thinking,

hopefully this will be a fantastic

new venture. If it isn't,

I'm not going to be penny

list on the streets.

I'm going to find something else to

do to live my life in a way that is

rewarding and fulfilling.

And that was kind of it.

Is there anything you and your partner,

Tim, are trying to do differently?

You guys, kind of similar paths,

Ben was an equity partner at

a very well established firm,

very easily could have stayed there

another decade or so and retired

comfortably, but he wanted to

not only challenge himself,

but he wanted to do some things

differently than what the larger firms are

doing.

Is there anything you and Tim talked

about in regards to doing differently with

your own firm?

Yeah, I think so. So

large law firms are great for

clients who need big teams often

and who need multiple practice areas.

They need people who have expertise,

countries around the world, corporate

M&A, structuring certain transactions,

sanctions, rules. That's great.

It can also present

challenges working in MySpace,

which has mostly been white

collar defense and investigations.

There's conflicts that emerge when

you have so many corporate clients,

actual legal conflicts,

but sometimes just sort of positional

conflicts of you shouldn't take a certain

case because it's going to offend

a corporate client who wouldn't

like that position.

And the business model is very leveraged

and there's some types of cases that

just doesn't make sense for a large firm

to take on that I think you can do in a

more boutique setting.

So that was fundamentally part

of why we wanted to do this.

We wanted to be able to do the cases we

wanted to do and thought we could do a

lot of them without sort of the large

infrastructure of a big law firm,

and that has proven to be the case.

Can you tell us a little bit about

what you've done to date to build your

practice and what have been the biggest

challenges that you've encountered that

you didn't expect to

encounter when you started?

It's been a challenge

to build anything new.

We are sharing someone else's

office space right now.

They've been very gracious.

We're hopefully going to have

a lease on new space soon.

We've hired a couple of people.

That's always sort of a challenge.

If you wait until you have

provable revenue before you hire

people, then you're just going and saying,

doing work that you shouldn't be doing

and not having time to run your business.

So you have to make some

calculations of, okay,

I think we're going to have

enough to keep this person busy.

So we have an of counsel who's a very

senior lawyer who sort of works on

specific cases.

We have an associate who is part-time

because she's starting a clerkship in the

fall and wanted a semi-flexible schedule.

And we have an analyst who,

as a young person who just left college

and is looking to go to law school in a

couple years and very capable doing a

lot of the sort of fact analysis work

that I think in previous cases would

often exclusively be reserved for

associates, even when it's not really

legal work that needs an associate. So

we've built out a bit that way. In

terms of challenges we faced, I mean,

one challenge, Ben, I'm sure

you thought about this too,

it's sort of a who do we want

to be kind of challenge because

there's a couple things you go out there

with a vision of what you want your

firm to be, right? And then there's

what the market wants to hire you for.

And you have to kind of match

those things a little bit.

If you have a vision of this is

what we're going to do, period,

and the market's not going

there, then you're going to fail.

But at the other extreme,

if you just say, "Well,

people are calling me for

these insurance defense cases,

wow." And then you do a few and you're

doing well and now you have a team of 20

that's doing insurance defense cases,

then maybe you wake up in five

years and say, "But wait, wait,

this isn't the business I wanted to

start." So it's a little bit thinking of

sort of what you want to build.

And one of the thoughts we have,

which in addition to the white

collar defense and investigations,

is we want to do some

work in the crypto space.

We both started talking about that's

really an area where there's, I think,

a lot of opportunities to do

work addressing fraud in this

sector,

which is really just rampant and there

haven't been a lot of great solutions for

you.

Did you and your partner sit down

and come up with a vision plan or

an initial kind of business plan

or are you just kind of getting

going and then seeing kind of

early on where that takes you?

Yeah.

I've actually found your podcast once

we reconnected very helpful and was very

intimidated when you talked

about your vision plan and Jeff,

all the things that you put into place.

And I'm giving myself a little bit of

a pass that some of what you were doing

was sort of stage two of

growing your business.

We did talk about a plan and we have

some ideas about what we want to do.

One thing we did last month,

and we're going to make it

like a quarterly thing now.

We meet every week about the

cases and things ahead of us,

but we're now doing sort of quarterly

meetings where it's more try to do

it out of the office,

a more sort of free form session where

we can really sort of strategize.

And I think we'll probably do something

maybe at the beginning of the year where

we maybe take a day or two and do

something like that because I think that's

obviously very, very important to do.

How did you guys go about

assessing the market need for

another firm? I mean, we're a

little different. We're up in Maine.

It's not nearly as saturated,

but anyone listening to this that may

be in Los Angeles or New York or Philly

thinking about making the move,

hanging out their own shingle,

but looking at a very well

established saturated market,

how did you and Tim, did that discussion

happen and how did you address it?

Yeah.

So we thought about that

because it is a pretty saturated

market in New York and we do civil

litigation, we do trial work too,

but we're really known for is white

collar defense and investigations.

Most of our network are former

federal prosecutors and it's

not actually a very busy time for white

collar investigations work these days.

So we did think about that,

but we'd seen a number of people who

had either left large law firms or

sometimes leaving the US attorney's

office started their own practice and

they've been very successful.

And I think part of it is the

economics of large law firms

doing a huge range of white collar cases.

It just doesn't work very

well for a lot of those cases.

And so I found sort of

my network of friends who

wouldn't call me when I was working at

Covington because probably they assumed

it would be a case I couldn't do.

I wouldn't be able to handle there.

Maybe they were right, maybe

they were wrong sometimes,

but when you set up a boutique,

they think of you for these cases where

there's an individual they can pay or

it's a company, they have a

small matter they can pay,

but they don't need or want a sort

of very highly leveraged structure

running some kind of

massive, massive case.

Makes sense.

Have you thought in terms of what

you'd like to build in terms of

the scale of it? Do you have an idea,

would this be just you and your partner

and maybe enough counselor or two,

an associate or two,

or are you looking to

build the next ... I mean,

you're not going to build

the next Covington or ...

Yeah.

Likely,

not in your lifetime probably just given

the timeframe it would take to hire

thousands of lawyers,

I'm sure going to be around for quite

a while. You look great, by the way,

but one wouldn't aspire to do that

probably if you left a big law to

build the next big law.

But do you have an idea of the scale

of what you are trying to build?

And I guess as part of that is,

do you envision yourself continuing

to do the day-to-day practice of law,

try the cases, interface

with all the clients,

or do you envision yourself at some

point taking on more of a managerial

role and kind of building

out a business where

other people are doing the day-to-day

practice of law and you're benefiting from

their labors?

Yeah, that's a great

question. So first of all,

I do think we definitely want to grow.

I think it's hard to do things where

you're two or three very senior lawyers,

maybe one or two associates. That's

not the scale we need to have.

We need to be somewhat bigger.

It needs to be so that if

there's a significant case,

it's not something that's going

to tie up me and my partner,

we can't run the business or bring

in new cases or anything like that.

So I think we want to grow and expect

to grow over the next couple of years,

but I think we don't envision

trying to become a 50

lawyer firm or anything like that.

I think that would be more

than we would want to be.

I'm not sure what the exact

right size of it would be,

but to your other question,

I think that's an important one in terms

of running a business versus actually

practicing law.

Right now,

I'm having a lot of fun with the

running the business part of it,

even stuff that's kind of dumb.

It was fun to go in and open

my first corporate bank account

and lawyer trust account.

And it's kind of fun to learn about

some of the legal tech software.

And I felt some real pride

actually when we hired our first W2

employee as an analyst.

I'm participating in the economy in

a way that I haven't before. I mean,

I guess at Covington, I was a

part owner and hiring people,

but you don't feel it as directly

as when you offer someone a job.

And so all of that is really, really fun,

but a lot of it is not my

highest and best use either,

and I need to be conscious of that.

So I think chief operating officer

ideas is great that you have there.

I've also heard the advice of before

you hire people to do tasks for you,

you need to know what the task is and

understand it. And so I think the idea is,

let me learn some of these

aspects of the business.

Let's get people on board

eventually who can do those things.

And then I can divide my

time, I think, between

more creative business development,

establishing what our identity is.

And I do want to keep practicing

law. I do want to keep doing cases.

They're super fun. But I

could see a point maybe five,

10 years down the road where I'm doing

much less of that and just sort of

helping our business have a

place out there in the market.

One interesting thing when I started here,

and it hasn't even been a year yet.

I started in January when I was here

a little over a week and then we

went to an offsite strategic

planning out in Denver and

I wasn't sure what to

expect, and to your point,

it was kind of phase two

of the strategic growth,

but we knew what type of firm,

or Ben and Taylor already knew

what type of firm we wanted to be.

It was complex med mal, catastrophic PI.

So a lot of our first discussions

were around core values

and culture, and what type of

culture we wanted to build.

And what we came up there

has really driven our

hiring focus has driven

a lot over the last year.

Have you and your partner gotten to a

point where you've talked about culture

and the core values that you

want your firm to represent?

Yeah. I did listen to you guys

talk about that on your podcast.

And I think Tim and I

have both thought of that.

I think we have similar core values,

but I think going through the exercise

of sort of articulating them and then

also thinking about how to

concretely build those things.

And I think that's something we'll have

to think a lot about as we add people to

our team. I think we're looking for ...

We want an entrepreneurial environment.

We want people to be energized

and creative and trying

to think of what they can

do to bring things to the next level,

but we also very much don't want

sort of a siloed environment,

internally competitive environment.

I think those things can be

very negative for law firms too.

We don't want someone who's just

going to come in and say, "Yeah,

this is a good platform for me to make

some bucks for the next few years,

and then someone else will give me

a better platform." We want to build

something that has some kind of identity.

And I think balancing those two things

is kind of a challenge for a lot of firms.

How you guys have thought of

that and how you address that.

I know the contingency model,

contingency model probably

makes it somewhat different,

but there must be similar

things to grapple with.

Yeah. I mean, it's interesting to hear

you talk about it, Arlo, because I mean,

Jeff, as he mentioned, has been

here for just under a year.

And our firm has been in

existence for about five years,

which is not all that long really,

but a lifetime because of what

you go through and learn in

those early years and

your mindset and growth.

And so many of the things we've learned

and come to have been through trial and

error and making mistakes and the core

values. I mean, we talk about it now,

but for many years, we didn't

live out any clear core values.

We aspired to do certain things,

but we're not fulfilling them.

We hired people that didn't meet those

values and they're no longer here.

So we came to those

realizations through the hard

experiences of life that led us to really

reinforce because you can read about

them in a book, but then when you

live it and see how it plays out,

it has a much larger impact in

your thinking and actions than just

theoretical knowledge of it. You're in

a place where you're still trying to get

your feet under you and figure

all this kind of stuff out.

So you're right where we were

basically when we started.

I think we've learned a lot,

but you're probably ahead of where we

were for your stage of development.

I mean,

for people that are in your position

looking to build a firm and maybe they're

not quite where you are yet or

they're in a parallel position,

what are some of the resources

you're finding that are useful,

both from a business standpoint,

from kind of putting the technology,

the nuts and bolts together that

you're putting together their website,

everything?

Yeah. I mean,

I think this is like a great time to

start a law firm in terms of what's out

there to support you.

It's really remarkable how

much you can readily sort of

outsource so that you can not

worry about a lot of things.

And then I understand at a time you might

be at a size where you insource those

things back,

but we have a terrific part-time

bookkeeper who's a former

FBI agent, does some forensic

accounting on the side.

There's very good law practice

management platforms. So we have one,

we have an outside IT provider who we

pay a certain amount for up to five

seats a month and they're our support

desk. They set up our computers,

they do the information security

stuff. You can do a lot.

We use a PEO. I don't actually

know what the acronym stands for,

but they're basically a

co-employer of your employees,

right? And so you can get someone

to handle all the payroll stuff,

benefit stuff,

get access to healthcare plans that

you couldn't as a small business.

So that's all fantastic.

And I'm a pretty heavy believer in AI.

I follow the technology really closely.

I listen to like four podcasts a week,

annoy people at parties.

You were doing that before AI.

Yeah. Yeah. Well, that's a fair point.

What are the podcasts you like on AI?

I'm curious because I'm into that myself.

There's one, I'm forgetting the name

of it, by Paul Rhodeser, Marketing AI,

Smarter X.

He does sort of a business minded sort

of update on what's going on in the news,

but I also listen to things that are

really pretty technical like last

week in AI,

which is 90% of it sometimes goes over

my head when they're talking about

scientific papers. But I

find it very fascinating.

Is that going to be a big tenant in how

you structure the business as the trying

to find efficiencies through

AI or use it to replace or

supplement human personnel in some way?

Absolutely.

I think my own views about the

technology where it is right now is there

are some real questions about

whether large language models,

that's what powers ChatGPT, et cetera.

You're going to be able to continue on

that path and have a breakthrough where

you have a whole leap in intelligence,

something that can generally

be as intelligent as a person.

You could give it a fake associate

that can just do the work.

I think there's real questions about

how much further that technology can go,

but the technology that

exists so far is amazing.

And what is lacking is processes

and applications that make

that readily usable for

lawyers to get stuff done.

And I think that's what you're going

to see in the next few years is people

building in those applications and

you're just going to be able to get a ton

from it. I mean, right now, I

would encourage anyone to do this.

You should pay 20 bucks a month,

or if you get an enterprise plan,

it's like $25 a seat for ChatGPT

or pick Anthropic or pick

Gemini, turn the setting so

it's not training on your data.

Be conscious of getting client consent

if you're going to put anything that's

confidential in there, et cetera.

Just use it and play around with it.

ChatGPT, for example, you

can select different modes.

You can select a professional mode where

you can give it much more finely tuned

questions and we'll go off and research

for 20 minutes and come back to you with

some really good understanding.

We have the latest Westlaw AI,

which has some advanced

research capabilities,

but I use it every day for

all kinds of things. I mean,

just one kind of example,

this happens sometimes. We get a call

or an email from a potential client

saying,

"I was involved in this crypto project

with this token and this happened and we

were defrauded through this

and this and blah, blah,

blah." And it's a lot of stuff

that is not dominant in the

news. I dump the email into ChatGPT.

I don't put necessarily the names of

everyone if there's something sensitive,

but the facts of it. And

then if you just say,

"Go figure out what happened here,"

that's not going to work. You say, "Look,

I'm considering taking this

person on as a potential client.

I need to know what this company

is, what this crypto project is.

Are there reports of fraud? Please

check all sorts of internet forms.

I need a report back on if

there are allegations of fraud,

who is alleged to be behind them,

what ties to the United States do they

have? What resources are they known to

have? " And it'll come back and

it'll give you a report. Now,

is that report going to be

100% right? Probably not.

There are probably going to be

some details that are wrong,

but that's the problem I think

a lot of lawyers have with AI.

There are plenty of use cases where it

doesn't need to be 100% correct to get

value out of it. It can be 95% correct.

It can be directionally correct

with some details wrong.

And if I then have a meeting

with that client, my God,

I'm so far ahead of where I would

be if I hadn't had that tool.

I could have asked an associate

to go do that research.

It would have taken an

entire day at least,

and there would have

been errors there too.

So just getting comfortable with

using it for things like that,

I think is fantastic and lets

us do a lot more for less.

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What do you think the potential

issues are with AI? I mean,

obviously crypto, which you

guys want to have a focus on is,

I don't want to say has been the Wild

West, but there's so much fraud happening.

Do you see with the

advancement of AI and how

quickly things are changing, large

language models, open source,

do you see potential dangers

with AI that actually might

result in substantial litigation?

Yeah. I mean, there already is a

great deal of litigation around AI.

There's copyright cases.

They were all trained essentially

on copyrighted data and there's very

interesting questions about

whether that's fair use.

There's some very interesting

litigation about the responsibility for

AI,

a machine when it's having a

relationship with a teenager who

is turning to it and maybe it's

fueling some mental health crisis.

And there've been lawsuits over people

who've committed suicide tragically

based on some kind of

relationship with AI.

So I think there'll be a

lot of litigation there.

There could be some litigation.

I think there has been actually where

AI has put out erroneous information.

There've been, I think,

defamation kind of cases.

So I think that'll be a very

interesting area to watch as well.

Yeah. Going back to your origin,

when someone's at a firm and

they're thinking about leaving,

Ben obviously chose to go

with a partner, Taylor,

and you obviously chose to go with Tim.

Was your thought that if you

were going to hang out a shingle,

you would always have a partner

or was it just Tim was the right

person, so you didn't

want to do it on your own?

Yeah. Actually, my thought had

been, I will do it on my own.

Let me do something that's just in

my own view of what I want to do,

not have to answer to anyone. That

was sort of the back of my mind.

And early this past year,

whenever I hear someone started

their own practice or whatever,

I go out and talk to them. And I

talked to Tim and he had started his,

and it wasn't with the intention

of I was going to go work with Tim.

But then as we just started talking

about some ideas for cases and what we

wanted to do, it just sounded more

fun. We had some similar ideas.

We're also different people and

we bring different strengths.

And so much as in my head, I

like the idea of like, "Oh,

I'll just do whatever I think is right

and that's much more fun. No one's going

to tell me that's a bad idea." It's good

to have someone who'll tell you it's a

bad idea and vice versa.

So it's a difficult,

it's a challenging relationship for

anyone to manage where you're going into

business with someone and

you're equal partners in this.

So we really have to form consensus.

And it's important, I think,

to be able to have that consensus and

have some common foundation of what you

want to do,

but also be able to disagree and hear

each other out when you disagree,

because otherwise you're not going

to get the benefit of having sort of

co-leadership of an enterprise.

How hard was your process

to exit Covington and the

firm you were at? I mean, you don't have

to get into details, but was it mutual?

Did you have to get outside counsel

involved to help negotiate your

exit or was it relatively seamless?

I think when you say was it mutual,

I think that's code for I was fired.

No, amicable is better than mutual.

Yeah. Or also breakups,

right? It was mutual.

Yeah. We don't want to get Jeff back

into the topic of breakups again. No.

Yes. I heard from one ... I sound like

a fanboy of your podcast, but yeah,

you've had some divorce.

I've been divorced too.

Maybe we can go on a

separate podcast about that.

I think we could. What was harder?

Your actual divorce or the

divorce from Covington?

Covington was great. I

mean, they were surprised.

I was having a good career there. I

don't think anyone wanted to see me go.

And when I said my

goodbyes to people, I mean,

there were definitely people who I think

were a little hurt maybe that I was

leaving or perplexed.

I will also say though,

I heard in the voices of some either

expressly or implicitly like, "Wow,

I wish I was able to do

that. I wish I could do that.

" It was very amicable and

they've referred work to me.

There's some cases where Covington could

do that case or I could do their case,

but we're largely not competing

in the same spaces. I mean,

we're not going to do some

kind of 30 person corporate

investigation where we need

teams all over the world.

And there's often a lot of cases in the

white collar space where a company may

need representation and then there may

be some bunch of individuals that need

representation or the board needs its

own counsel or an audit committee. And so

there are opportunities that I hope

will continue to work with them.

There's some great people there.

Yeah. I just think some of the

trepidation of people leaving,

aside from the comfort of their firm

is how much of a hassle is it going

to be to exit somewhere where

they've been for a decade or so?

And it sounds like yours was

relatively seamless, which is good.

Yeah, it was relatively seamless. I

mean, look, whenever you're a partner,

an equity owner of a law firm,

you have a partnership agreement and

there's things you got to deal with no

matter where you are.

But I don't think that's the kind of

thing that should hold people up if ...

You should never feel like

that's a handcuff. I mean,

if you have a desire to do something

different, you can't just fall back on,

well, it would be hard. Yeah,

a lot of things are hard.

You mentioned that you were enjoying a

business side of building your practice.

Are you enjoying about it?

Yeah. I mean, part of it is just

it's something I've never done.

When I left the US Attorney's office,

which amazing job after 10 years,

part of why I left is like, sure,

there was still stuff I could learn,

but I didn't feel challenged in the

same way I did at the beginning.

And then at Covington, being

a big law firm partner,

learned a lot there, but I

hadn't had these challenges.

So part of it is just the challenge of

figuring out how you do these things.

It's really eye-opening coming from

a platform where you have everything

taken care of for you as I did,

even in my 20 lawyer firm, but Covington,

I'm sure it's like ... I mean, I

was at a big firm myself, so I know,

but I mean, it's like that on steroids.

Everything is taken care of for you.

I mean, your car service to get to

your appointment, all of your staff,

all of the back office functions,

all of your CLEs or your borrowed mission,

everything is literally done for you.

Now you're responsible for doing

all of those things for yourself.

That's pretty eye-opening at first,

how many things there are that you

didn't even appreciate have to be done,

right? And you mentioned

your highest and best use.

It's like I'm home doing my laundry.

I always joke with my wife. It's like,

it's not a good use of my time

to be doing this laundry. I mean,

I could be working right now and-.

How does that go?

No, I'm not suggesting she do it for

me. I'm just suggesting that ... Well,

actually, maybe I am. Paul,

Sarah. And I'm not even divorced.

So my point being that you end

up doing a lot of very kind of

tedious tasks

that would've been considered well

beneath your stature as a partner at

Covington, right? And you have

to kind of be humble about that,

but also at some point you realize, well,

maybe this isn't the best use of my time.

So how are you dealing with that whole

barrage of things that you now have to do

for yourself that you used

to have others do for you?

Yeah, two things.

One is I think that is a real

challenge because I actually find

it fun the first time I do it.

Maybe the first time you tried

washing your clothes pen,

you'll find the machine fun, you

can press all the buttons and-.

How does it work? Watch them

go around. It's exciting.

Yeah. So the first time I had to

figure out malpractice insurance,

like, that's cool. I have my own insurance

thing. Then it comes up for renewal.

Okay. I don't want ... It gets tedious.

And it's also even to the extent

I may find some interest in

some of the administrative

parts of the business. Yeah,

it's not the best use of my

time. But I will say this,

in terms of what you have,

the trade-offs in both a place where

you have to do everything yourself and a

huge firm. The one thing I've

told people when they say,

"What's different?" And maybe

this wears off then, I don't know,

but every day when I wake up and your

head kind of clears, you're like, "Oh,

what do I have to do today?" Everything

that I feel like I have to do today is

because I feel like I have to do it.

And that's a powerful feeling too.

I may not want to fill out the

malpractice insurance thing,

but I know it's got to be done.

Big law or any big company,

I wake up, there's a bunch of things.

Yeah, I want to do those things.

There's a bunch of things like, wait,

there's a meeting on this committee and

there's a mandatory training on that.

So there's also comes just a lot of

things that you don't think are things

you should be spending your time on,

but you don't have any

control over it either.

It's just part of being

in a large organization,

the friction that comes with that.

Yeah. And I mean,

everything you're building,

you're building for the benefit

of yourself and your partner,

and there's a nice feeling that

goes along with that. Also,

despite my comments about the

laundry, and I do do my own laundry,

there's an empowering feeling

to being able to do things,

the things you need to do for yourself

and learning the blocking and tackling of

how all of that happens.

You feel empowered by it.

And then as you grow, as we have,

I don't have to do most of

those things for myself anymore.

We have people that can do the

CLEs and send in the bar admission

fees and handle the malpractice insurance

and the finances and everything.

But I know how all that works now.

It's not a mystery to me anymore.

And it's nice to know that.

And it's also nice to appreciate

what people are doing for you,

what you once had to do for yourself.

I think there is some value in that in the

early stages. One question

I have for you is,

you were kind of similar

to me in that, I mean,

timing of when we started our practices,

I forgot you were younger than me because

I'm 54 now and you said you were 51.

I was born in 73, right? So what am I, 52?

Yeah, you're two years younger. So I mean,

we both kind of started practices at a

phase in our life where neither of us

could really afford to go a year without

a paycheck. We have responsibilities,

we have kids in college,

and that's a different challenge than

when you're maybe fresh out of law school,

hanging a shingle and eating

ramen noodles in an apartment.

You have to generate revenue in

year one. But on the flip side,

hopefully because of your success,

you had some resources to invest

in your firm to begin with.

And it sounds like you did.

You were able to buy case management

software and hire outside IT firms and put

these pieces in place.

So can you just talk a little bit about

the timing of what it's like to start a

firm at this age as opposed

to when you're younger?

And how do you think through the

finances of having to replace

what I assume was a relatively

generous compensation

scheme at Covington within

a few years so that you can

meet all your own personal

financial responsibilities?

Yeah. I mean, number one,

a lot of people just need to think about

what their financial needs and goals

are because if you're

trying to sort of just max

out the numbers in your bank account,

that it may not be the right thing for

you to do to start your own practice.

If that was my goal, I don't think

I would've done this. I mean,

I don't know how lucrative this may be

or not be, but if that's your mindset,

that's your bottom line

going into it, I need to,

or want to have this much money,

it's maybe not the thing for you.

You got to think about what

else makes you go in life.

Of course, though you need

your own, you have expenses,

you have things you got to take care of.

I came to it at a point where

I had enough money in the bank,

had enough for the kids to go

through college where it's like,

if I don't have to take money out of

this firm for some period of time,

that's okay. And then at some

point, I will want to and need to.

But being a former federal prosecutor,

I spent 10 years getting paid what is a

lot of money, maybe some

places, some professions,

but in New York City as a

lawyer is not a lot at all.

It's a small fraction of what you

can get as a law firm partner.

And you know what? I was okay, right?

Maybe I didn't go on as nice vacations,

but I was okay and I was happy.

And so you just need to think about your

relationship with money and how it fits

in with some of the other goals in.

Your life. Arlo, can you talk

about when you started your firm,

obviously you and your partner

were known quantities individually,

but your firm and the firm name brand new.

How did you go about reaching

out to centers of influence

or people to let them know that you're

hanging your own shingle and you would

appreciate referrals and kind of build

that network that you've probably

had over the last 10, 20 years?

Yeah, no, that's a good point. I

mean, I'd say there's two things.

So one is the network of former

prosecutors where we get,

I think most of our

referrals, it's fantastic.

The people who worked in the

Southern District together,

if you were there for 10 years,

people 10 years older than you,

10 years younger from when you're

doing defense work, it's just great.

And you see all these people,

there's all sorts of events.

An element of interest when you strike

out on your own and start a new firm.

I mean, people seek you

out at the cocktail party.

They want to hear about it.

It's more interesting than someone else.

So that kind of gets you front of mind

and people have thought of me that way.

Here's the other thing, as a lawyer,

especially this kind of lawyer anyway,

it's a very low bar to be

interesting on LinkedIn.

Most of my friends at larger firms,

the only posts that they can

ever make are, it's an honor.

And with great pride,

I recognize the award in Law

Dragon 970 of eight of my

colleagues in the Bladibu practice. And

I mean, those are nice things. Actually,

people should post those.

But if I post anything like,

I don't even think it's edgy, but I'll

post something about crypto or AI,

or I'll use AI to generate some artwork.

I actually once did a AI avatar of me,

it looked like me, but it was not me.

I was typing in things

and doing a crypto scam.

And I go to these events

and people are like, "Oh,

you're the crypto stuff

and you do this and that.

" And it makes an impression on people.

The sort of crypto broader general public,

that's a different challenge in

marketing and they're not on LinkedIn. So

reaching other audiences, we still

have to figure some of that out,

but sort of the network of

people that we already know,

I think it's remarkably straightforward

to kind of get them to think of you.

How do you think about scaling up? I mean,

taking on each new case you take,

assuming you have to think

through, or do you have the time,

do you have the resources

currently to handle that work?

And then where is the point where you

say, "Well, we're at the breaking point,

we've got enough or potentially too much,

we should bring on somebody

else or we could just be more

selective in the cases we take and

turn down work." How do you think

about that as you're thinking

about your next step?

Definitely do not want to

turn down work. I mean,

unless it's a bad case that we're just

not going to be able to help the person,

particularly if it's coming from someone

who's thought of us to refer it to.

So we'll try to do the work and as long

as it's something we think we can be

successful at and we hire people,

we're still looking to hire people.

You have to sort of be a little bit

optimistic about the future without

being irrational. I think the hardest

thing we're going to have to do, Ben,

and something maybe I'll pick your

brain about more is we're open

to and interested in doing contingent

fee work in the right cases,

the large scale crypto scams. And some

of these are very interesting cases.

There are a lot of

interesting legal issues.

They may be hard to get

litigation funding for,

which is also very expensive.

So I think one of our challenges will be

how to maybe invest in some

of those cases while still

having resources to be paying

associates who are doing other things as

well. So sort of balancing ...

The ideal world is we do well enough on

the paying cases to be able to sort of

fund smart bets on contingent fee matters,

but there are not a lot of

law firms that I think have

cracked that nut in this kind of space.

Boy Schiller is certainly one of them,

but figuring out that I think is

going to be our next kind of real.

Challenge. Yeah. I was going to ask

you about your fee structure. I mean,

sounds like most of your cases

are on hourly rate still,

or do you do flat fees or what?

Most are hourly rate or

some sort of flat fee.

We do have a few contingent fee matters.

We were involved mostly before I joined

in a very interesting crypto related

class action that we're

no longer involved in,

but that was a purely contingent fee/court

approved class fee. But yeah,

so it's a mix of things.

And people keep saying the hourly

rate is going to die, right?

They've been predicting it forever,

but flat fees are really challenging

too because in the criminal defense,

white collar investigation space,

there's a lot you don't know when

you're taking on a matter. So to say,

"I'll do this investigation

for X price." Or, "Oh yeah,

the government just says they have

a few questions for you. Sure,

let's settle on Y." There's

so many things you don't know.

So pricing I think is still a

really hard thing to do there.

Yeah. I mean, it's the

contingent fee model.

I'm so accustomed to it and that's all

we do. So it's second nature to us.

But if it's not what you do, it

really does raise lots of challenges.

And as you mentioned that,

we were just talking early this morning

about funding because we self-fund all

of our cases and extremely

expensive to do that,

but we have a model that

allows that to work.

But it hadn't occurred to me

how rare that is for people

who don't do contingent fee work.

You're not accustomed to funding cases

at millions of dollars out of your own

pocket.

Yeah. I would imagine, I mean, maybe I'm

oversimplifying it or overstating it,

but probably the beauty a

little bit of what you do,

high end medical malpractice is

you're not always going to be right,

but you can sort of value a case, right?

It's going to pay between this and this,

and it's going to take between this

many months and this many years and have

some kind of range,

maybe you're wrong a lot,

but I feel like since we haven't figured

out what kind of cases we would do,

I think it's going to be a

lot harder to value them.

Yeah. The valuation is an issue,

but what ultimately makes it work

for the firms, I think works,

and it's both the mixed firms that do

mixed hourly rate and contingent and the

pure contingent is that

they have a high enough,

a large enough docket of those cases

that they're diversifying the risk across

cases.

If we just had one med mal case that

was going to be worth $0 if a defense

verdict or a hundred million,

you can't take on that risk. No,

we have many, many cases,

and if some of them go south on

us because we get a bad result,

despite our efforts, that's

part of the business model.

We expect that to happen

and it's risky, but we,

just like anything,

the risk is well managed because

of the docket of work that we have.

And I find that's often what the hourly

rate firms run into. They'll see a

contingent fee case every now and then,

but now they're implementing a totally

different business model just for one

case that doesn't really work

with the rest of the practice.

It's just a hard thing to do,

but I definitely think there are some

very successful firms that have meshed the

two.

I think that just means that you

need to have some critical mass of

those types of cases, whether it's 50%

of your practice or 40% of your practice,

but you just don't want to have one.

Yeah. It's just too risky.

It's like going into the casino and

putting all the money on one number on the

roulette wheel, right? No one would

really do that. It's not rational.

But if you're betting red or green,

you're going to win 50% of the time.

And if you win big when you win, yeah,

that's a pretty good ... Makes sense.

Yeah, it's a tricky thing to do.

I don't think that many firms have

really struck that balance all that well.

That's why firms like ours exist because

we have a contingent fee model that

works for us. But yeah, I think

there's a great opportunity for you,

especially in the fraud and

crypto space and all that.

The one thing we know is the extent of

people trying to steal other people's

money using new

technological approaches to

defrauding people of their

money is going to be enormous.

Yeah. Oh, that's great advice.

I know we're getting close on time.

You had mentioned you guys

are currently still hiring.

I guess what roles are you looking for

and what's your ideal applicant in those

roles?

We're concentrating, I think,

on associates and analysts might

be called paralegals at other

law firms,

but I think what we're looking for for

now is people who are very interested in

maybe their college grads and they're

thinking about going to law school.

And maybe there's a few firms that have

sort of set up programs that are sort of

structured around that and they've gotten

some excellent talent and these folks

can do traditional paralegal work,

but they can also do things sort of

beyond that. And they're not lawyers,

they can't do legal work, but they

can, I think, add a lot of value.

And then we're looking for associates,

either people come to boutiques

like ours with white collar defense,

if maybe they want to think about being

a prosecutor in a couple of years and

working closely with people

who have that experience.

So I think folks like that we'd

be interested in. And also,

I think folks who are just sort

of creative and ambitious and want

to be part of something growing and

who knows what will happen then.

Well, Arlo, it's really great

to see you and to catch up.

Congrats on your firm

and all your success.

Well, it's great to catch up with you

and it's an honor to be on your podcast.

If I'm in New York, I'll look you up,

but definitely try to look us up

if you ever get back to Maine.

I know you haven't been

back in a while, but ...

I will. I will definitely do that. Yeah.

It was a pleasure, man,

you are low. Thank you.

All right. Thank you,

Jeff. Thank you, Ben. Bye.

Bye. Thanks for listening to Elawvate:

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