Canadian Legal Summit: Running Law Firm Canada Business Challenges

• An on-demand webinar by LEAP Legal Software Canada addressed the business challenges faced by lawyers running their own firms.
• Panelists at the Canadian Legal Summit discussed growth strategies, financial fundamentals, and the impact of AI on legal pricing.
• Lawyers often lack formal training in firm management, making business aspects a significant learning curve.
• The importance of understanding financial metrics like cash flow and remittances was emphasized as non-negotiable.
• Hiring support staff earlier than comfortable was identified as a key strategy for scaling and delegation.

Anyone who understands this and figures this out will have an advantage over other law firms.

Many legal professionals embarking on the journey of running a law firm in Canada often possess deep expertise in their chosen practice areas, yet find themselves navigating unfamiliar terrain when it comes to the operational aspects of their business. This fundamental disconnect between legal education and the practicalities of firm management was the central theme of an on-demand webinar, "Running a Small Firm in 2026: What’s Changing — and What Actually Matters," presented by LEAP Legal Software Canada. The session aimed to shed light on the significant business challenges confronting lawyers who operate their own practices.

The discussion, which convened at this year’s Canadian Legal Summit, featured insights from four experienced practitioners who have successfully built their own firms. Moderated by Josh Koziebrocki, Principal of Koziebrocki Law, the panel included Erin Cowling, CEO and Founder of Flex Legal; Kimberly Gale, Principal of Gale Law Professional Corp.; and Jagjit Bhathal, founding partner of Hummingbird Lawyers LLP. Koziebrocki underscored a common sentiment among legal entrepreneurs, noting that while lawyers eventually commit to running a business alongside their legal practice, formal legal education typically does not equip them with the necessary skills for firm administration.

One of the primary law firm management challenges highlighted during the webinar concerned the complexities of growth. While the initial phase of establishing a firm might feel manageable, with a steady flow of work and sufficient time to handle it, the subsequent transition to scaling operations quickly introduces significant hurdles. Kimberly Gale articulated this difficulty, stating that "Growing is the hardest," and describing the firm's inception as "the honeymoon stage." The panelists delved into the practicalities of this expansion, exploring critical decisions such as the optimal timing for hiring new personnel and whether those roles should be full-time positions. A key focus remained on expanding the team without losing sight of the core motivations that initially drove practitioners to establish their independent practices.

Beyond growth, the discussion emphasized the non-negotiable importance of robust financial fundamentals for any Canadian law firm business. Panelists stressed the necessity for firm owners to have a comprehensive understanding of their financial metrics, ranging from consistent cash flow management to timely remittances. This foundational knowledge is crucial for maintaining stability and making informed strategic decisions, regardless of whether a firm is in its first year of operation or its tenth.

The evolving landscape of legal services, particularly the AI impact legal pricing, also received dedicated attention. The panelists observed that clients are increasingly utilizing artificial intelligence tools to analyze legal bills and are subsequently challenging fees. This trend presents a significant question for legal professionals: how can firms effectively demonstrate their unique value when clients can leverage AI to generate initial drafts of various documents or scrutinize billing statements? Erin Cowling highlighted the strategic advantage available to those who master this challenge, asserting that "Anyone who understands this and figures this out will have an advantage over other law firms."

Another critical practical takeaway for running a law firm Canada business involved the strategic timing of hiring support staff. The consensus was to bring on assistance earlier than might feel comfortable. Jagjit Bhathal shared his personal experience, noting that after hiring a clerk, his only regret was not doing so a year sooner. This early investment in hiring support staff law firm operations allows for crucial delegation, enabling practitioners to scale their services more effectively. The panel collectively acknowledged that there there is no definitive manual for successfully operating a law firm, and that learning often occurs through direct experience. Despite the inherent stress and "slog" involved, as Kimberly Gale put it, the overarching message was one of perseverance.

Lawyers operating or planning to open their own practice in Canada must proactively address the business aspects of firm management, including growth strategies, financial fundamentals, and the integration of technology like AI, to ensure long-term success and competitiveness. This article highlights key operational and strategic considerations often overlooked in legal education.

Source: Original reporting via LEAP Legal Software Canada webinar