Greg McKeown:
Welcome. I’m your host, Greg McKeown, and I am here with you on this journey to learn as fast and deeply as we possibly can. Have you ever felt that a monotonous life cannot possibly be an essential life? Have you ever found at the same time that sometimes in what appears to be a monotonous experience, you find something deeply meaningful?
Today, I have a fascinating conversation with Kyle Westaway. He’s an entrepreneur and a lawyer who works with entrepreneurs, but as we got into our conversation, we veered almost immediately, completely off what our intended conversation had been, which is about how he used Essentialism and Effortless principles to upend and create a completely new law office, something I’ve never seen anyone else do, and certainly not as smoothly as clearly, and really as brilliantly, let’s get to this.
As you’re listening today, think of one person who could benefit from one idea from this conversation and share it with them that will benefit them, but also it will deepen your understanding and increase your ability to put into action the things that we talk about.
If you were designing your business or your life from scratch using Essentialist and Effortless principles, what would you do? Today, you will learn how to do that from someone who has actually done it. His name is Kyle Westaway. I was introduced to Kyle by Banks Benitez, who himself used Essentialism to lead his organization into a four-day work week back in episode 23. If you want to go back and listen. Banks said of Kyle, I only introduce you to one out of a hundred humans, but Kyle might be one in 10,000. Kyle runs Westaway, his law firm that is entirely built on Essentialism principles and practices. There’s no hourly billing. There’s fixed rates published on his website and Effortless systems, so go and check out his website to get an idea of what we’re talking about here. In his spare time, he is the genius mind behind the Weekend Briefing with a hundred thousand plus subscribers. I’m subscribed to that and really enjoy it. Kyle Westaway, welcome to the podcast.
Kyle Westaway:
Greg, it’s great to be here. I was so, so excited when we decided to have this conversation because I have been reading your work for many years, and it’s been the foundation of how I’ve built my business and how I’ve built my life, so really appreciate the work that you’ve done and I feel like I am a beneficiary of it.
Greg McKeown:
Yeah, that’s so nice, Kyle. We spoke just yesterday, and we were meant to get to how you had designed your new business based on Essentialism and Effortless principles, but we got sidetracked, although we’re not sure it really was a sidetrack onto talking about your personal life, your children, your family, and so on. I’m glad we did that, but now I want to hear the other side of the story. What led you to build Westaway based on essentialist principles? Why did you do that?
Kyle Westaway:
Well, I was a founder before I was a lawyer and I had a lot of pain points when I was interacting with lawyers when I was on the founder side. The traditional law firm is set up in such a way that the experience is slow, it’s opaque. You don’t really get direct answers. There’s a lot of, it depends, especially for early-stage companies, there’s a lot of over-lawyering, meaning the amount of risk tolerance of a Fortune 500 company is placed on a struggling startup, and it just takes a lot of resources to get to that level of risk tolerance. So there’s no, it felt like a one size fits all approach, a sledgehammer approach to working with very early-stage startups, and it felt like that could be a user experience that could be improved. As I was a founder, I’d also just finished law school, so I thought maybe I could build a firm that would address some of this, these issues and maybe potentially make a very founder-friendly firm.
Greg McKeown:
What you just told me is that these law firms were not fit for purpose for a founder environment. They’re too expensive, too hard to work with, too ambiguous, too risk-averse to be nimble enough to do what it is that you needed them to do.
Kyle Westaway:
That’s right.
Greg McKeown:
Yeah. And so, at some point, you decided to be a founder still, but of a law firm. Are you familiar with other people who have done this? This seems quite radical within an industry that almost always seems to work the same way.
Kyle Westaway:
Radical is one word, stupid is another word. I was very young in my practice, Greg. I was a year out of law school. I had a really clear vision for what I felt should be done and I went for it. I don’t necessarily recommend everybody does that. It could have and should have, for so many reasons, ended up in disaster. But if you’re asking, do a lot of lawyers go this route? And the answer is no. We’re an industry that’s known for risk aversion and known for hedging and making sure that we remove risk from the situation. So because of that, there aren’t a ton of us that are really entrepreneurial, and I think what I’ve learned about myself over the years is I’m an entrepreneur that happens to be a lawyer. I just enjoy the risk and strategy involved in building something from scratch.
Greg McKeown:
In what way is Westaway, your law firm, different than a traditional law firm?
Kyle Westaway:
I think it boils down to who we serve and how we do it. So who we serve. We focus on a very specific niche. We want to work with folks that are just getting their business off the ground until the first, whatever, we’ll say, first hundred employees, so very early-stage companies. I love that those folks, like I, get very energized by working with founders at that stage, and they have a unique set of issues that later-stage companies don’t. We’re not a firm that is built for big companies that kind of shoehorns their way into working with early-stage companies. We just build the firm around this essential client, right, this one client that is an early-stage founder, so it’s who we’re serving, and then that dictates how we serve. Right?
Greg McKeown:
Okay, but that’s important, right? So what you’re saying is that the first thing you did is you got really clear on the priority customer. So you weren’t just saying, we want to work with anyone who wants our services. You said we know who we are going after and who we’re not going after, and that was one decision that made a thousand.
Kyle Westaway:
Absolutely. And if anybody starting any business or leading a business, if that’s not clear, I don’t know how you succeed. To me, it feels like it’s hard enough to serve one client really well. One type of client will say really well, and if you’re trying to be everything to everybody, it just seems like mediocrity is the result.
Greg McKeown:
Why?
Kyle Westaway:
I think mastery requires repetition around certain contexts, doing the same things over and over again, and getting building up judgment and knowledge that is just so much easier to do If you’re only doing that with one, we’ll say customer set or client persona
Greg McKeown:
You are saying that the speed to competency is far greater if you narrow your focus in the first place.
Kyle Westaway:
Competency, then mastery. Yeah.
Greg McKeown:
Yes. Competency then mastery because you are interested in not just being basically competent at looking after the legal needs of a founder. You are interested in being absolutely the best law firm, let’s say, in the world at doing that thing. Is that right? Am I exaggerating?
Kyle Westaway:
No, it’s weniger aber besser. It’s less but better. You focus on less things so you can do them better.
Greg McKeown:
Yeah, less but better. How else did you apply? Less but better. We’ve said it to the customer. What other applications did you make?
Kyle Westaway:
Yep. So what is very common for successful law firms that are growing is to go into increasingly more complex work to work your way up the ladder from basic work to more and more complex work. We’ve made a conscious decision not to do that. Made a conscious decision to say, let’s do the basic work and continue to improve how we deliver that better and better. Saying no to the types of work is another way that we’re doing less but better. We want to be super clear on our circle of competence and what’s inside that and what’s outside of it. I had a call an hour ago, and on a lot of my intro calls with potential clients, the phrase that comes out of my mouth is, here’s where I think we can help you, what we’re good at, what’s in our wheelhouse, here’s where we’re not. And trying to be super clear on that. I find it takes a lot of pressure off of the service provider, whether you’re a management consultant or whether you’re a lawyer or whatever you’re doing, to not try to fake it till you make it, to just actually stick to your competency. And then it also sets really good expectations with the client so that you don’t have to worry about the failure that happens when you are faking it until you make it.
Greg McKeown:
Yeah, I really love this. Let’s go back to it for a second. Basic work versus more and more complex work. What is basic work for you?
Kyle Westaway:
Yeah, we do incorporations, we do funding, we do employment stuff, and we do contract negotiation. That’s the basic work. That’s the bread and butter that we do.
Greg McKeown:
What don’t you do?
Kyle Westaway:
We don’t do complex M&As. We don’t do funding rounds beyond series B. We don’t try to do international structuring. We don’t think about creating tax structures in Ireland and the Netherlands. That’s not the stuff we do.
Greg McKeown:
So very few of the people listening to this are going to found their own law firm, although sure, I’m sure that we do have at least a few that either are or will based upon this conversation. But for everybody that’s in this conversation right now, they have an opportunity to learn from what you just described, to identify your circle of competence, what it is, what the essential basic work is that you are going to provide to the world. And the really empowering point you’re making is you can say no to the other stuff. You can educate upfront, this is what we are good at. What was the phrase, here’s what we’re good at, here’s what we’re not. How did you feel as you said that to them today?
Kyle Westaway:
It feels great now. It was terrifying, Greg. It was terrifying years ago, whenever I was first starting the firm, it was, we can talk about how precarious it was to try to build this thing from the ground up, but it was so scary to walk away from potential money. It’s just there is a huge fight or flight reaction to having somebody, well, first of all, you’ve probably done a ton of BizDev to just get the person on the call, right? And then they’re asking you to do something that’s slightly outside that circle of competence. And so you feel that money is right around the corner. That is maybe incredibly essential for you to, for instance, pay your rent this month. But you have to say no. It was really terrifying and I was not good at doing it. I was not good in my early years at saying no and saying, I don’t know. It’s incredibly freeing to do so now.
Greg McKeown:
So what you’re saying is that essentialism almost ruined your life.
Kyle Westaway:
It could have.
Greg McKeown:
So looking back, do you think you should have been more open at first and then become more selective over time? Or, looking back, do you think it was really hard for me, but actually being as rigid about it was key to the success that’s followed?
Kyle Westaway:
There was enough for me to learn within this circle of, at that point in time, I was trying to become competent in that. I actually think it was really helpful. It’s not the best financial strategy, I don’t think like the best financial strategy is to say yes to everything that comes in the door until you have enough money to be able to say no. It was really helpful from a building my craft perspective because I just got a ton of reps on this stuff that I now do day in, day out. Yeah, I think it, I guess I do think it was a good move, but I can only say that because I was able to survive, right?
Greg McKeown:
Yeah. So there’s, it’s like a, it’s revenue versus craft. That was the trade-off you’re describing there. And so that’s right. Somebody listening to this, they can make their own adjustments to that based upon their needs for revenue and their desire for craft. What’s the primary skill that you’ve learned along the way?
Kyle Westaway:
There’s a couple of different answers to that. I think for me, one is client management is probably the most important skill in client services, whether you’re in consulting or if you’re doing anything that touches clients, client management really makes or breaks client experience, right? All of our joy or sadness in life is measured by what we expect walking into a certain circumstance, right? So if the expectation is at a certain point and that’s exceeded, then you feel very happy. If it’s below, then you feel very sad, right?
My personality when I was younger would be to promise the moon and hope that I could deliver that. And I think a part of my maturing process has been to be really clear and probably on the downward side of expectation in initial conversations and hopefully really exceed that bar. So I don’t think that’s particularly like novel to me. The feedback from making that switch has been great. People, founders love working with us because their experience is, is better than they had hoped it would be. So that’s key. And then the second skill is all about just like more around your work around Effortless, how to build systems that deliver at high frequency with high levels of quality. So those are the two biggest lessons I’ve learned.
Greg McKeown:
Can you unpack more of what you mean by making your organization effortless? A law firm does not produce in one’s mind an effortless culture, and that’s what I just heard coming out of your mouth. So explain that for us.
Kyle Westaway:
This is the message I’ve been trying to tell to all my fellow lawyers that a law firm could be effortless. Of course, there’s hard work to make things effortless, but I, where I believe my industry, and this is true for any most client service industries, has gone wrong, is the incentive structure is not set up for effortless. It is set up right to, it’s just, it’s not, it’s set up for the exact opposite. It is set up to clock as many hours as the client will allow you to get away with, and that’s where your revenue and profitability like comes from. The more buts you get in seats, and the more hours you get the billing, the more profitability you have as a company.
Greg McKeown:
What problems does that produce? Before you go to an improvement? What problems does that produce?
Kyle Westaway:
Well, it ties into the pain points I talked about earlier, which is that why if you could finish something in a half hour or two hours and you make four times the amount of money for finishing it in two hours, why wouldn’t you do that? If you could be quote, extra thorough, and put four times the amount of work into something that only needs a half hour’s worth of work, you would actually not be a smart person. It would be against your interest to do that, and it would be against your interest personally because you were ranked within the firm and your bonus is all, is all dictated by hours billed. It would be against the overall firm’s interest as well because that’s where their revenues and profitability come from. It creates slowness, it creates over-lawyering in times when that’s not really necessary. It creates a lot of friction in a system.
So what’s one of the biggest frustrations I have with my industry is when I’m interacting with other lawyers, there’s two days of back and forth to schedule a call whereby we have, they have seven lawyers on their side on the call, and I’ve got myself on the call, and we spend a half hour or an hour talking through things, and we don’t really accomplish anything except for the fact that they’re able to bill seven hours in that one call and it ends up being like, cool, we’ll read that and follow up over email. So it creates this really slow, inefficient, and opaque processes that are probably suited for some companies. That’s probably what you need for a Fortune 50 or a Fortune 100 company. You probably need that level of service. Maybe not, actually, but let’s assume that that’s a really good fit for that level. But that model permeates through the entire industry, no matter who the client is. And it doesn’t make any sense to me.
Greg McKeown:
This idea of hourly billing seems like it is bad for the customer, but it’s also bad for the lawyer, for the employee because it incentivizes super long hours. And if you’re on some major case, then you can expect to be there for almost all night long. I know one lawyer that was drinking Red Bulls literally all night long, and when I spent the time with them the next day, they were almost like a different person to who they normally are because of that kind of thing, but they’re incentivized to do that. And so, of course, they’re incentivized to work more hours, bill more hours, increase the hourly rate that they’re charging you because, again, this is the only way for them to be more profitable, and so on. So you are saying at the core design of the legal firm, there’s a bad incentive. So what have you replaced it with?
Kyle Westaway:
That’s exactly right. And even going further than that, there is a sense an identity within many people in client service that my time is my value, that literally the hours I’m clocking is how valuable I am, and that’s what they’re patted on the back for. That’s what they’re incentivized for. So it’s all about time in as opposed to quality results, and I’m no genius, but it seems like what clients care about is quality results. So it is bad for the attorney, and I think it’s bad because it requires a lifestyle that means I need to be billing at 10 o’clock at night. I put my kids to bed, and then I need to be like logging back in and billing at 10 o’clock and 11 o’clock, and 12 o’clock. I was talking to a buddy of mine that has a big firm, and his partner, who’s whatever in his sixties, is pulling all-nighters frequently, and I’m just like, man, is that the life that you had envisioned for yourself? Is that where you wanted to be at 60, pulling all-nighters to like rack up your hours?
I think it’s really bad for the attorney and what it does. So the billable hour, incentivizes, hours logged. If you switch off of that, it’s a completely different mindset. So if you go to some sort of flat fee or fixed fee mindset, then you’re in the world of everybody that’s not in client service, right? You’re in the world of any product manufacturer whereby here is the price that I have, here are the cogs going into that. How can I reduce the cogs amount so that I can increase my profitability? Then you start to ask yourself questions like, huh, I did that thing in two hours. Now, if I spent an extra hour to make some templates, automations, or SOPs, could I do it next time in half the time, nobody in their right mind on the billable hour system would invest that extra hour to reduce future time spent because it would be insane. It would be actually a silly thing to do. But when you’re on a flat fee structure, when you decouple value from time and you start to ask, is the value in what I’m delivering, then you can get really efficient, and efficiency is a bad word in the billable hour world. In our world, it is like the holy grail. The holy grail is how can we get 1% better, 1% more efficient on that piece of work?
Greg McKeown:
Yeah. What you are saying again, which I think is so true, is that if you have time equals value, then you are going to produce a burnout culture. It’s inevitable, actually inevitable, and so then you have this additional nefarious thing happen where it becomes intergenerationally, culturally supported, so that you say to the person who’s coming up the ranks, yes, you’ve got to pull the all-nighter. That’s what we do as if that’s what’s driving success, and secretly, sneakily does this incentive system, this way of doing business that is unquestioned. It’s the same everywhere. That is really at the nexus of this way of doing business. By decoupling value from time, you have completely transformed an industry, okay, for people listening right now, so what? What does this have to do with them? What is the news for the people listening to this conversation?
Kyle Westaway:
I think there’s direct application if you are in any sort of client service industry, and the question that I would be asking if I were in your shoes, is there a way to move from an hourly services-based business to a flat fee productized business or at least products within your business whereby you could find efficiencies and deliver at high-profit margins? So that’s like the directly applicable thing if you are in client services. Now, if you are not in that world, if you’re not in the billable hour world, maybe the question that I’d be asking is, what is the incentive structure in my world, and is that actually tied to something other than quality outcomes? And if so, is there a way I can question the status quo or try to take a small bet on trying something different that would more accurately align value with quality outcomes?
Greg McKeown:
Thank you. Really, thank you for listening, for being part of this conversation, for helping to make this a movement. I hope you felt that this was time well spent. What is one idea, though, that particularly stands out to you? Why does that matter so much to you? And who is one person that you can share that insight with so that you can make a contribution to them, but also so that your own understanding deepens and your own follow-through increases?
Speaking of follow-through, I’m creating these tools. I’m creating them for you. The One-minute Wednesday newsletter that’s for you at gregmckeown.com/podcast. You can get all of the transcripts, the notes, questions, and additional materials to be able to help you reinforce the lessons in this investment that you’re making to be here, and really thank you for listening, for being part of this conversation. I’ll see you next time.
