Lawyerist Podcast The Hidden Cost of Bad Clients, with Jeff Krause
Dec 18, 2025
Not all clients benefit a law firm equally. Poor-quality clients can drain resources and lower profits significantly. Jeff Krause reveals a Moneyball-inspired profit formula that emphasizes the importance of client selection. He discusses the hidden costs of discount-seeking clients and the need for clear expectations. Balancing profitability with access to justice is explored, along with actionable steps for law firms to improve decision-making using data. Discover how to enhance your firm's performance by understanding client dynamics.
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Moneyball Scene Shows How To Fire Quickly
- Stephanie recalls the Moneyball scene where Jonah Hill awkwardly fires a player and Brad Pitt guides him to be quick and direct.
- She says being concise and empathetic makes firing easier for everyone involved.
Simple Profit Formula Reveals Levers
- Jeff Krause presents a simple profit formula: leads × conversion = clients; clients × transactions × dollars per transaction = revenue; revenue × margin = profit.
- Plugging real numbers into the formula reveals where growth or decline actually comes from and which levers matter most.
Client Quality Impacts The Whole Formula
- Client quality affects every element of the profit formula: leads, conversion, repeat work, price paid, and margin.
- Better clients refer better clients and streamline operations; poor clients compound negative effects across the firm.