Value Pricing for your Business

Value-based Pricing (“VBP”) shifts billing from the traditional hourly fee model to a new value-based approach, where the fees are based on the value provided, not the time spent.

Value-based Pricing (“VBP”) is better for both the client and the attorney. VBP gives clients the peace-of-mind of not getting an unexpectedly large bill at the end of the month. It gives attorneys the ability to be compensated for value as opposed to a sometimes arbitrary amount of time it takes to complete the project. We believe the hourly billing model is antiquated because incentivizes slowness and doesn’t allow clients to budget as they start or grow their business.

VBP is determined by weighing a variety of factors such as project complexity, length, resources required, and value provided to the client. Because every project is unique, there may be projects that require additional time or services outside the scope of the original engagement. In these situations, an additional fee may be due. But don’t worry, unlike the traditional (and out-dated) hourly billing model, we always discuss the additional work required with you before we charge you any more for your project.

As you probably know, the future is very hard to predict. Lawyers stuck in the hourly-billing model don’t really care about the future, because they are just focusing on doing the work and billing the client for the time they spend on a matter. Did a lawyer zone out for 10 minutes while working on your matter? We are human, so we would be lying if we said we are always 100% laser focused and impervious to distractions. Nonetheless, you will never know, but you will probably pay for the time spent re-focusing and picking up where that lawyer left off.

With fixed-fee and value-based pricing, we have agreed on a price ahead of time and the future is fairly certain (subject to certain issues that we uncover that may be outside the initial engagement). That means, if we get distracted or zone out, you don’t pay for that, we do. It means we are now incentivized to be efficient and make sure we deliver on what is promised.

Might you end up paying more with fixed fees, possibly, but you have to weigh the advantage of predictability and aligned incentives versus being billed for a matter where the end cost could be 5x what you budgeted.

If something is “outside of the scope” of our original engagement, it means that the project we agreed to work on when you first engaged did not include or cover the issue that we are discussing that is outside the scope. For example, if we are engaged to structure your corporation and you did not inform us of a few agreements you had negotiated with other parties, such matters could throw a wrench in the structuring and require considerable more time on our part.

We strive to be as transparent as possible with our clients. However, issues arise with deals that create an additional level of complexity. When this happens, we do have to charge for the additional services required to address such issues.