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Adam Kaplan, Kristi Gamble Kaplan & Gamble, New York, N.Y. Entertainment law practice Two attorneys, founded in 2003 � Keep overhead to a minimum, especially if a firm is just starting out and does not have a lot of funding. To keep costs down, Kaplan & Gamble has bartered whenever possible. For example, trading help with intellectual property issues for computer networking and other services. “Before we started the firm, we met with several other entertainment lawyers and they all said the same thing: Keep your overhead down,” says Kaplan. “It’s important to save a dime when you can in the early stages of a firm’s life, until you know what your monthly income is likely to be and can plan accordingly.” � Don’t allow one client to become too large a portion of the firm’s business. “When that happens, your cash flow depends on the cash flow of the client and the demands of that client may not leave time to develop new business and cultivate new clients,” says Gamble. Her rule of thumb is to try to avoid having any one client represent more than 50 percent of the firm’s accounts receivable. � Manage firm growth carefully and have a contingency plan if cash flow is adversely affected. Alan Tippie SulmeyerKupetz Offices in Los Angeles and Menlo Park, Calif. Corporate law practice specializing in restructuring and bankruptcy 26 attorneys, founded in 1952 � Get partner support for cash flow management. Partners have to accept that their draw may be reduced and/or postponed if cash flow is tight. � Keep the cash reserve fully funded. SulmeyerKupetz maintains a cash reserve equal to 45 days of operating expenses and disperses any money in the account to the partners at the end of the year. “The challenge on January 1st is to build that reserve back up,” says Tippie. It helps that the firm pre-pays many of its largest expenses at year end, which eliminates some cash needs for the first few months of the year. Therefore, more of the revenue collected in January can go to re-fund the 45-day cash reserve. Timothy Szuhaj Shimberg & Szuhaj Westmont, N.J. General business practice Five attorneys Founded in 1993 as Charles Shimberg; changed name to Shimberg & Szuhaj in 2003 � Establish a bank line of credit but use it sparingly and only for equipment or capital improvements. � When adding to staff, calculate the return the new hire will generate then weigh the cost and cash flow impact of that new hire compared to the perceived and actual benefit that person will bring to the firm.

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