Highlights From the 2025 Legal Trends for Solo and Small Law Firms Report

Since 2016, Clio’s annual Authorized Tendencies Report has been a trusted useful resource for uncovering key developments within the authorized trade.

Acknowledged as probably the most in-depth evaluation accessible, the report brings collectively important information on regulation agency efficiency and sheds gentle on the forces driving change in authorized apply.

Now, we’re placing the highlight on solo and small corporations with the discharge of the 2025 Authorized Tendencies for Solo and Small Regulation Companies report. Tailor-made particularly for the distinctive wants of those corporations, the report dives into the most recent tendencies impacting their operations—from expertise adoption and fee flexibility to advertising and marketing methods and spending habits.

Beneath, we’ve highlighted just a few of probably the most compelling findings. Or, bounce straight to the total 2025 Authorized Tendencies for Solo and Small Regulation Companies report for deeper insights into how solo and small agency legal professionals are adapting to at the moment’s authorized panorama.

The place does the information come from?

The Authorized Tendencies for Solo and Small Regulation Companies report makes use of a spread of methodological approaches and information sources to ship the most effective insights in regards to the state of authorized apply and techniques for future development.

Clio information

We’ve analyzed aggregated and anonymized information from tens of 1000’s of authorized professionals within the U.S. This information gives essential insights about how expertise is presently being utilized by authorized professionals, in addition to its affect on agency efficiency.

Survey of authorized professionals

We surveyed 1,028 U.S. authorized professionals from June 5 to 23, 2024. The authorized professionals we surveyed included legal professionals in addition to assist workers—corresponding to paralegals and directors—who’re engaged within the administration facet of their apply. Moreover, we surveyed 1,437 Clio clients from April 15 to 25, 2024.

Survey of the final inhabitants 

We surveyed 1,003 adults within the U.S. normal inhabitants from June 28 to July 2, 2024. This survey was designed to gauge attitudes, opinions, preferences, and behaviors relating to the authorized occupation amongst people who’ve employed legal professionals previously or who might turn out to be potential authorized shoppers sooner or later. This pattern is consultant of the U.S. inhabitants by age, gender, area, revenue, and race/ethnicity based mostly on the newest U.S. census statistics.

Solo and small regulation corporations are lagging in AI adoption—however that would quickly change

Within the 2024 Authorized Tendencies for Solo and Small Regulation Companies report, we discovered that 19% of mid-sized and smaller regulation corporations have been utilizing AI of their apply. 

Whereas AI adoption has since surged throughout the authorized trade, solo and small corporations are apparently hesitant to combine AI into their practices. Traditionally, smaller corporations have been early adopters of authorized expertise, main the way in which in cloud-based apply administration software program and on-line funds adoption. Nevertheless, AI adoption has been a lot slower amongst them when in comparison with bigger corporations with many limiting their use or avoiding AI altogether. 

This hesitation could possibly be as a result of useful resource constraints. For instance, bigger corporations have the monetary and technical infrastructure to undertake AI at a extra superior degree. However, regardless of these challenges, solo and small corporations acknowledge AI’s potential: greater than 4 in 5 authorized professionals consider AI use will improve over the subsequent 12 months, suggesting that solo and small corporations might merely be ready to undertake AI. 

Amongst solo and small corporations which have embraced AI, solo and small corporations are inclined to prioritize instruments that tackle their distinctive wants. For instance, solo practitioners are extra doubtless to make use of digital receptionists, whereas small corporations gravitate in the direction of doc drafting and automation instruments. This focused method means that whereas solo and small corporations aren’t adopting AI at scale, they could be leveraging it strategically to maximise effectivity and fill operational gaps. 

Should-know statistics on solo and small regulation corporations’ AI use

72% of solo authorized professionals and 67% of small agency authorized professionals are utilizing AI in some capability of their apply. Nevertheless, solely 8% of solos and 4% of small corporations have adopted AI extensively or universally. 

Bigger corporations are considerably extra more likely to have adopted AI than smaller corporations: 85% of bigger corporations are utilizing AI in some capability of their apply, whereas 35% have adopted AI extensively or universally. 

Amongst solo and small corporations which have used AI, the preferred instruments embody generic non-legal AI instruments (for instance, ChatGPT) (57%/54%), authorized analysis platforms (54%/56%), digital receptionists (27%/16%), doc drafting or automation instruments (25%/30%), and eDiscovery options (20%/19%).
Over 4 in 5 authorized professionals in corporations of all sizes consider that the utilization of AI will improve within the subsequent 12 months. 
The highest advantages of AI, in line with solo and small corporations, are saving time and rising effectivity (61%/63%), saving cash (37%/34%), and bettering the standard of labor (36%/34%). 

Solo and small corporations are embracing flat charges, however the billable hour stays dominant

Solo and small regulation corporations are more and more incorporating flat charges into their billing practices. Whereas hourly charges stay the most typical technique of billing, flat charges are gaining traction as shoppers demand extra transparency and predictability in pricing. Solo corporations are barely extra inclined to supply flat charges for whole instances, whereas small corporations are barely extra inclined to use them to particular duties inside a case. This displays a broader development towards providing versatile pricing choices that cater to consumer preferences. 

Curiously, regardless of the rising reputation of flat charges, bigger corporations usually tend to experiment with different billing fashions, like subscriptions, underscoring the rising significance of providing predictable, clear pricing. As automation instruments like AI cut back the time spent on routine duties, the necessity for corporations to regulate their billing fashions turns into more and more essential. In reality, generative AI may put $27,000 in annual income per lawyer in danger in the event that they stick with the normal billable hour. 

For solo and small regulation corporations, adopting flat charges alongside conventional billing fashions requires strategic planning. These corporations should assess which companies or duties are finest suited to flat charges and take into account how AI may additional streamline their operations and enhance effectivity. As consumer expectations shift towards extra predictable and clear pricing, corporations that successfully combine flat charges into their enterprise fashions can have a aggressive edge. 

Key findings relating to agency billing fashions

75% of solos and 65% of small corporations report utilizing flat payment billing fashions, whereas 84% of solos and small corporations report utilizing hourly charges. 
Amongst solo and small regulation corporations providing flat charges as a fee possibility, 80% of solos and 72% of small corporations used flat charges for all the matter whereas 39% of solos and 43% of small corporations used flat charges for particular actions inside a matter. 

Referrals stay the strongest consumer acquisition device for solo and small corporations, however expertise can improve outcomes

Each solo and small regulation corporations agree: referrals are the highest supply of recent consumer leads. And, whereas solo and small corporations leverage numerous advertising and marketing channels—together with web sites, on-line critiques, social media, and search engine optimization—referrals proceed to ship the best return on funding. Nevertheless, corporations that strategically complement referrals with a robust on-line presence and consumer consumption expertise are seeing even better success. 

Many solo and small corporations function with restricted advertising and marketing budgets, making it difficult to spend money on a number of channels. In consequence, they have a tendency to give attention to cost-effective methods like phrase of mouth advertising and marketing and leveraging present networks. Regardless of this, corporations that incorporate expertise into their consumer consumption processes see tangible advantages, together with increased revenues, elevated consumer leads, and improved conversion charges. 

What to learn about improved consumer consumption efficiency

59% of solo and small corporations report that referrals are their highest supply of leads, whereas solely 27% of bigger corporations report the identical. 
Income: we noticed 53% increased income amongst solos and 28% increased income amongst small corporations utilizing e-signatures, on-line search adverts, on-line schedulers, on-line consumption kinds, and textual content messaging. 
Consumer leads: Solo corporations loved a 48% improve in consumer leads, whereas small corporations skilled a 6% improve in consumer leads, utilizing the identical options. 
Conversion charges: we noticed improved conversion charges amongst solo and small corporations utilizing e-signatures (10%/10%), textual content messaging (7%/3%), and on-line consumption kinds (2%/5%). 
Time to rent: we noticed shortened hiring time amongst corporations utilizing on-line search adverts (26%/31%), e-signatures (23%/24%), on-line schedulers (10%/7%), and on-line consumption kinds (9%/5%). 

Solo and small corporations cleared the path in cloud-based apply administration software program adoption, however solo corporations are investing much less in software program

For each solo and small regulation corporations, salaries (for each companions and workers) make up over one-third of their whole bills. Nevertheless, solos spend a considerably bigger proportion of their whole bills on accomplice salaries, whereas small corporations spend a considerably bigger proportion of their whole bills on workers salaries. 

Investments in software program {and professional} charges are the best regulation agency spending development areas, suggesting that corporations are focusing their consideration on these areas. The common regulation agency spends slightly below 2% of its total bills on software program (barely greater than the U.S. Census’s trade estimate), aligning with the spending habits of small corporations. Nevertheless, solos are spending half of that quantity and have the bottom software program spending of the cohorts we reviewed. 

For each solo and small regulation corporations, the preferred instruments embody cloud-based information storage, video conferencing, e-signatures, digital submitting, on-line and digital funds, and cloud-based apply administration software program. Moreover, solo and small regulation corporations are considerably extra doubtless to make use of cloud-based authorized apply administration software program and on-line or digital funds instruments in comparison with bigger corporations.

Our findings on mid-sized agency spending and adoption habits

The highest bills amongst solo and small corporations are accomplice salaries (19%/6%), workers salaries (18%/30%), workplace bills (11%/6%), advertising and marketing (9%/5%), and lease (7%/7%).  
The common small regulation agency spends 2% of its bills on software program—or the common U.S. Census trade estimate. Nevertheless, the common solo agency spends solely half the U.S. Census trade estimate on software program.
The most well-liked expertise amongst solo and small corporations embody cloud-based information storage instruments (81%/85%), video conferencing (80%/80%), cloud-based apply administration software program (79%/81%), on-line or digital fee instruments (76%/72%), and e-signature instruments (72%/78%). 
79% of solos and 81% of small corporations use cloud-based authorized apply administration software program, in comparison with solely 47% of bigger corporations. 

The ultimate phrase on the 2025 Authorized Tendencies for Solo and Small Regulation Companies report

Regardless of slower preliminary adoption, the way forward for AI in solo and small regulation corporations appears to be like promising. These corporations are clearly conscious of AI’s transformative potential, particularly in the case of rising effectivity, saving time, and bettering the standard of their work. Whereas they could not but be adopting AI on the identical scale as bigger corporations, the information means that many are taking a strategic, needs-based method—investing in instruments like digital receptionists, authorized analysis platforms, and doc automation that ship the best operational affect. As these instruments turn out to be extra accessible and user-friendly, we are able to anticipate to see a broader wave of AI adoption amongst solo and small regulation corporations. 

On the identical time, solo and small corporations are persevering with to adapt in different essential methods, from embracing flat charges to streamlining consumer consumption by means of expertise. These modifications not solely enhance the consumer expertise but additionally assist corporations stay aggressive in a quickly evolving authorized panorama. By investing in the appropriate applied sciences—AI included—and aligning pricing and consumption fashions with consumer expectations, solo and small corporations can proceed to punch above their weight, providing customized service with the effectivity and agility of bigger operations. The corporations that succeed shall be people who view expertise not as a burden, however as a essential accomplice in delivering higher authorized companies.

Able to dive into these subjects in additional element? Obtain the 2025 Authorized Tendencies for Solo and Small Regulation Companies report!

We printed this weblog put up in Might 2025. Final up to date: Might 15, 2025.

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Clio, Expertise