"I'll be the first to admit there is not a lot of innovation in this. It is an old-school law firm," he said.

Networking crucial

Mr Prangell said his clients could pay as little as a third of the price of a typical law firm because he bills $350 an hour – rather than $750 an hour typical for a partner at a law firm – and he does not go over the quote.

For example for a copyright licence, a law firm may quote between $2500 and $4500 but clock it up to $6000 due to duplication of work, whereas he would be charging $2000 or less.

Mr Prangell said at the start, he was spending 90 per cent of his time networking and meeting people at co-working start-up spaces such as Fishburner, and was doing all kinds of work ranging from wills to conveyancing.

However, now he spends 80 per cent of his time doing actual legal work, specialising in the start-up industry.

But even in his first year, he said, he was earning more money as the owner of his legal practice than when he was an employee at a law firm. "You only need to bill one day a week in order to make good money."

He said a job at a traditional law firm no longer offered lucrative salaries due to competition.


"There are about two generations of kids who grew up thinking, 'If you get good marks at school, you should become a lawyer and earn good money'. But the influx of too many lawyers means that is not true any more."

Hive Legal a game-changer

Two months ago Jessica Kinny left Gadens, after four years of practice, to set up her own commercial law firm, Kinny Legal, specialising in the age care and retirement sector, commercial litigation and commercial transactions.

She said the advent of virtual law firm Hive Legal changed the legal landscape and clients are now picking and choosing lawyers for different projects rather than hiring all-service firms.

From day one she had work: a client approached her with litigation work she could take on because they were not a Gaden's client.

Since then she has been getting her work through referrals from solicitors and barristers and through her connections in the aged care and retirement sector.

She said working solo meant she did not incur the additional cost of multiple lawyers working on the same matter.

"For the kind of work that I do, which involves high-level advisory, it's not necessary for me to have high overheads through extra fees. At large law firms, duplication may contribute to additional costs and it may be difficult to turn work around quickly," she said.


Niche the way to go

Phillip James Briffa, who set up his own wills and estates practice in July 2013 after 2½ years of practising at Swaab Attorneys, said the days of generalist, "suburban" lawyers are over.

The 29-year-old said as general legal information becomes more widely available, practitioners will need to become an expert in a field so they can get work through referrals.

"We tend to be ultra-specialised and just really focus on one niche. It's basically about making a name for yourself in an area so you can attract work from other lawyers," he said.

"[Suburban lawyers] will definitely struggle, because the general public will be doing a lot more research online and there are a lot of cheaper alternatives out there. If it's not a warm lead, clients are much more price sensitive." he added that a significant number of his clients come through referrals from professionals.

Unlike Ms Kinny, Mr Briffa set up the firm with no client base, which meant he had to spend the first six months networking with other lawyers, accountants, financial planners and mortgage brokers. On an average week, he would attend at least two networking events and follow them up with multiple meetings during the day.

"Being a people person is an absolutely essential ingredient," he said, without which "you will struggle".

Mr Briffa said working alone means he can keep overheads low and meet clients outside business hours. It also means clients can deal with him directly from start to finish.


More lucrative career path

He said a solo practitioner could earn as much as senior associates who work at the big end of town on a salary up to $140,000, if not more, and offers a more lucrative career path than at a big law firm.

"You're quite restricted in the larger firms in terms of the pathway to partnership. The carrot is getting dangled further and further away. It used to be 10 years until partnership, and now it's 15, 20 years.

"So a lot of lawyers are now saying, 'You know what? It's just not worth it'. With technology, you can go and set up your own business, make a name for yourself and do financially better."