The Colorado legal landscape is entering its most volatile era in a generation, according to legal industry veteran Gene Commander, and the state’s small and midsize law firms stand at the center of the upheaval.
Commander, a former Denver office managing shareholder of Polsinelli who now advises firms on growth strategies through Gene Commander, said small and midsize firms simultaneously face professional, demographic and technological pressures reshaping the market.
“We’re going to see more change in the next three to five years than we have throughout my entire career,” he said. “If firms aren’t willing to take a step back, learn, make mistakes, learn from their mistakes and grow, the disruption may get the best of them.”
The warning comes as Denver has become a national legal hub, drawing more than 65 large firms headquartered outside of Colorado, while solo practitioners continue to make up about a quarter of the state’s actively licensed attorneys. Those trends have left firms of roughly 10 to 50 practitioners, squeezed between two different firm models, needing their own “reset to outrun legacy thinking,” Commander said.
The Professional Crisis: Breaking the ‘Catch-and-Release’ Cycle
For decades, law firms of all sizes have treated talent acquisition “like a revolving door,” Commander said, with the current attrition rate at 50% within an associate’s first two to three years.
“It’s a catch-and-release business model that is extremely expensive and difficult to sustain, particularly for smaller firms,” he added.
The solution isn’t simply higher salaries. “It requires diagnosing why young lawyers are leaving,” he said. Commander’s research shows that modern talent walks away from rigid career tracks in search of culture, mentorship and a sense of belonging.
“We no longer have the opportunity to just throw people in the deep end and assume that they’ll figure it out over the course of two, three, four, five years while the clients pay for their learning experience,” he explained.
Instead, Commander urged firms to build “agile career paths” that allow attorneys to off-ramp and on-ramp without dropping professional standards. He said this could especially help women, who historically leave the field in larger numbers after becoming parents.
“Does it take a little more management? Maybe. Does it take a little more administration? Maybe. But when you think of the cost of that additional management versus the cost of having someone walk out the door, you’ve got a 50/50 chance of losing their successor, too, if you don’t do any better job,” he said.
The Demographic Shift: Cultivating an ‘Owner’s Mentality’
Another lens is the demographic shift: Attorneys are holding onto leadership positions at unprecedented rates.
“There are twice as many lawyers 65 and older practicing in law than there is in any other industry,” Commander said.
A bottleneck at the top can stifle the mobility of younger partners, precisely at a time when the incoming legal talent pool includes more women and people of color than it did even 40 years ago, he said. Yet legacy firm structures can result in disproportionately high attrition rates.
Another factor leading young attorneys away from the private law firm model is the many nontraditional options law school graduates have to utilize their law degrees.
In response, firms can help themselves by demystifying the “business of law,” thereby cultivating an “owner’s mentality” among junior associates. Commander said, “The business of law has got to become more transparent from top to bottom. Young people have got to be given opportunities to participate at a much earlier stage. Introduce them to simple things: How do you engage with new clients? How do you deal with retainers, timekeeping, write-offs, write-downs and accounts receivable? How does the firm actually make money based on the revenue you generate?”
The Technological Catalyst: Punching Above with AI
While demographic and professional pressures have been building for years, the ultimate disruptor arrived in 2022 with the public launch of ChatGPT.
“It’s going to turn our service delivery models upside down, it’s going to turn our pricing upside down, and it’s going to turn our talent development and career advancement upside down,” Commander said.
However, he views the technological disruption not as a death knell for small and mid-market firms but as a competitive equalizer.
“This is a tremendous opportunity for midsize and smaller firms to level up their resources with technology,” he said. “If they’re proficient at it, they can compete at high levels with firms and on projects that they couldn’t compete with before because they couldn’t match up from a staffing standpoint. It allows them to truly punch above their weight.”
Commander predicted that firms’ pricing will be driven primarily by value, rather than by effort and hours, in the future.
The Bottom Line Argument
For senior leaders reluctant to abandon the legacy systems that made them successful, Commander offers a blunt economic counterargument.
“I’m not making the argument that you should do these things because it’s the right thing to do,” he said. “I’m making a dollars-and-cents argument. You are throwing a lot of money down the drain by doing it the old-fashioned way.”
For example, by cutting a 50% attrition rate in half, firms can instantly save massive amounts of administrative and recruiting resources. “That goes right to the bottom line, and then it frees up the time for people to do things that are building value,” he said.
Now is the time to make change, he added: “When there is disruption, it’s easier to make tough decisions and take direct action out of a greater sense of urgency, a greater sense of necessity. If we can get ahead of this, we can do some wonderful things.”
Editor’s Note: This article is the first in a multi-part series exploring the shifting business models of Colorado law firms. In future installments, Law Week Colorado will sit down with Gene Commander to look closer at specific actionable solutions for midmarket leadership.