$700/hr for legal advice vs. $100/hr for a top software engineer – why?
I'm currently working with a really great iOS developer. He is charging me $100/hr, which seems like a lot, but the hours he quoted for the full project were very reasonable. However, need some contractual work for the same company and have a friend who is a partner at a major law firm in the Valley & he charges close to $700/hr. He is very bright and hard working, but can anything justify $700/hr. What am I missing?
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[ 1.7 ms ] story [ 193 ms ] thread[1] With the exception of a few states where one can still "read law" under a judge or attorney and take the bar.
One big difference is people brag about a high paid attorney (it's considered a good thing to pay a lot for legal advice) but never brag about how much they pay their developers (it's considered a good thing to pay less for developers).
Moreover the "new grads without jobs" is a fairly recent development.* Recent grads with jobs are certainly not billing $700 an hour, so I'm not really sure what that has to do with the original question.
* Given the recent decline in LSAT registrations it is clear that this supply surplus is temporary and is not the new normal.
developer auction offers I'm getting is 85k to 130k so far, for someone with close to 10 year experience in the valley! wtf
If you want general legal advice for startups, talk to startup-friendly law firms. Many have packages where you give up 1-2 thousand bucks only for X number of hours + turning your startup into an INC or LLC or whatever + a small equity stake. For other law firms, you'll just have to talk to them and figure out what their rates are. Most are more in the 50-100 dollar range. Don't skimp on legal expenses, if you get sued for a few million dollars, you'll regret skimping on paying a better lawyer a few thousand bucks more.
https://en.wikipedia.org/wiki/Life-critical_system#Software_...
Are you willing to take a risk with your health or getting into legal trouble?
So the price of the best people just keeps going up and up.
With developers, there is more of a concept of "good enough". As long as you find someone that can build the thing and it works, that's good enough.
Are you going to employ him at the $700/hr rate? If so, you would have justified it. Unless the $700/hr were just a ploy to start a pricing negotiation, rather than what he typically bills, the cost is being justified by the people keeping him in business.
That aside, if he works for a big firm, it'd be fairer to compare his rate to that of what a consulting firm bills out its developers (which is very far north of $100/hr).
I've never hired a lawyer and I've never directly contracted myself out so I am by no means an expert on this topic. Great question though.
Lawyers are licensed and specialized - the costs associated are passed through to the customers into their rate.
2. I think you're paying $700/hr because you 1) went straight for a partner and 2) you went straight for a major law firm in the valley. It's also a mindset difference. I think lawyers charge based on the value they add, not the hours they work, whereas developers typically think about hours. A developer who writes a piece of code that saves you $1M should charge $100k for it, and a lawyer probably would. On the other hand, your developer would probably charge you 1.5 hrs * $100 / hr. :) * Full disclosure: I'm a developer and I have lawyer friends, but
2. The quantity of workload they provide per job is less, thus pricing is more dense (i.e. companies realize programmers work thousands of hours for a project and that the project viability would collapse at $700/hr)
3. In many cases you have no choice but to hire a lawyer, while more often you can say no to a programmer should the economics not support the project.
4. A lawyer has to go to school for approx. 6 to 8 years (at least in Canada) while programmers have a wide variety of education levels.
I'm sure I could list more...
There is something magical that happens in the 100 pennies between 99 per hour and 100 per hour, a mental chasm that is in reality no different than 98/hr vs 99/hr but we make it into a big deal. Why he chose that number, and why people choose any number for an hourly rate is always a curious thing to me. We pick numbers that we think are palatable with no real regard for the same rigor we put into other processes. Has he tested his rate?
But the idea of hourly rates is accepting of the premise incorrectly...
My guess is that if he is truly great he could make some lawyers jealous. Charging $700/hr may seem far fetched for a developer but making 700/hr is a very different thing. 70K bill to a client for something that took 100 hours to make is a much more salient strategy if you give them what they want.
Americans can't hire lawyers from the Czech Republic.
Regardless, I wouldn't worry about it because software engineers will be automating away lawyers soon anyway. ;)
http://www.lawyerclock.com
* I coded this during lawyer meetings.
Alongside the shortage, the cost of living in the Bay Area was rising which increased when there was an exodus of lawyers from law firms going to the Bay Area for in-house opportunities at startups. As a result to combat this, Law firms in SF/LA increased their associates pay which was then being matched throughout the rest of the country.
Once this happened it resulted in the increased wages leading to the prices at the level they are because:
- Noone wants to cut their wages - companies also do anything they can to prevent wage cuts even if that means reducing headcount.
- Law firms prestige are linked to money - in order to attract the best talent they compete on price by paying the highest starting salaries and bonuses. Likewise in order to keep the rest of the employees motivated they pay the same salaries across departments. Thus they then had to tackle the issue of the increase overheads so law firms increased their rates to manage increased overheads and to increase profitability of the firm ensuring they keep their best talent around.
However, with that said the reason lawyers are expensive despite the "oversupply" of them is because if you require a law firm with experience that is able to handle complex litigation, transactions etc and is able to allocate a significant amount of man-hours at your case then you're going to have to compensate them in order to do so.
So to answer the question are lawyers expensive, they're not. You can find one to handle basic paper work inexpensively however, if you require an experienced lawyer who can handle complex litigation, complex litigation, transactions etc and is able to allocate a significant amount of man-hours at your case then you're going to have to compensate them in order to do so.
You've hired an independent developer, at a reasonable rate.
Hiring a lawyer from a law firm, comes at the rate of the firm. He bring to the table the resources of a large law firm, and along with the cost of operating a law firm. In addition to his nice salary.
If you had hired an tech consulting firm you'd be looking a similar hourly rate if you brought in a partner.
Hire the $2600/hr guy and be done in ten minutes because of his fifteen years experience and deep knowledge of the system; spend $433 very quickly. Pick the $50/hr rent-an-intern and you're down for a day while they're googling the fixes. Spend about the same amount, but avoid the losses from 7+ extra hours of downtime.
Time is money, after all.
Same thing with an after-hours/emergency call to a plumber. Yes, you'll spend twice as much - but that's nothing compared to what it will cost to repair the structural damage to your house because your toilet overflowed and you ended up with three inches of standing water soaking into your everything.
* legal work is more likely to be boring, so you have to pay people more to do it (this is related to the first point above)
* if an app has a bug, it's usually easy to spot - if a contract has a bug, you may never know about it until it bites you. so you pay for the best attorney you can get, in the hopes of getting fewer bugs
* lawyers are more at the beck and call of their clients - really need something done overnight or over the weekend? they'll do it (though they'll resent you for it)
I'm sure there are as many lawyers who love or hate their job as there are developers that do... some people (like myself) love doing the work but I have many colleagues who find it tedius and boring. I would say also not an excuse.
Security or data integrity flaws are no more apparent than contract holes, and often are equally as disruptive.
Developers aren't at the beck and call? Lol I would say that's a misconception. Late nights and weekends are NO stranger to developers. Especially in actual companies (vs independent) where deadlines are approaching its very common to be strongly encouraged (read: required) to work weekends.
It's more likely that the combination of cheap alternatives (outsourcing, developer living in a carboard box in san diego, etc) are numerous and you don't need indepth knowledge to click buttons on your program to see it works like you wanted it to but you do need all that knowledge to look at a contract and confirm its legitimacy.
and as someone who's been both a developer and a lawyer, lawyers are much more at the beck and call of clients. software engineers generally know when they have deadlines approaching. lawyers get informed Friday night of a deadline they have Monday morning (transactional lawyers, that is).
your last sentence is precisely the point i was making re bugs.
Sweeping floors and cleaning toilets is also pretty boring, but I don't see anyone paying janitors more because of it.