Most of the time when people call my law firm they are calling because they are in a jam. While I prefer to work with clients to prevent those jams from occurring in the first place, I have come to accept the fact that most of you only want to talk to a lawyer when absolutely necessary.

Several months ago I had a conversation with a friend/client, who for lack of a better term is a management consultant. She goes into small businesses and helps them determine how to strategically grow their businesses, both through adopting the right systems and hiring the right people.

At the end of the conversation, we both agreed that it was time for her to make the switch from being a sole proprietor to a LLC. We talked about the costs of doing so and agreed that it was probably smartest for her to save up money for a couple of months before making the switch so that the change would have the least impact on her day-to-day cash flow.

About a month after our conversation, she called in a panic. She had been preparing for weeks for a big proposal with a new potential client. The business owner interrupted her proposal early on and had asked her if she was a LLC.

She told him that she was not, and he said that it was his policy to only work with people who took their businesses seriously. Which to him meant they were doing business either as LLCs or corporations. She mentioned that she had discussed this with her attorney and that she was “in the process of forming a LLC.” He told her that she could continue her proposal once she was a LLC.

She walked out of their offices and called me to ask what it would take to get her a LLC ASAP. I explained how the expedited process works and the fees associated with it. She told me to go for it and read off her credit card number. The following day we had a LLC for her. She called the company back up, set up a new appointment, finished her proposal, and her LLC won the contract for the job.

Now, we can debate if this is the kind of client she should be working with, but that’s another discussion for another day. The simple fact was, that a LLC was required for the job. It was off-limits to her unless she was a LLC.

The simple fact was, that a LLC was required for the job.

Last week we had coffee and I asked her how things were going and if she thought that forming the LLC in a rush was worth it. She took a few moments to think and answered yes. After talking it out with her, I walked away with the impression that it was worth it, not because she landed that particular job but because becoming a LLC changed her own perception of her business.

She mentioned a couple times that having to write the LLCs name into contracts or signing on behalf of the LLC was at first scary but then motivated her to live up to her mental image of what a LLC business owner was like. She also mentioned that her revenues had grown more than 50% since the switch. We talked about the tangible and intangible things that might have contributed to this growth, including her new outlook on her business.

She also mentioned that her revenues had grown more than 50% since the switch.

Now, you should not become a LLC just for a shift in how you think of your business. That would be reckless and ill-advised. But if all other signs point to the fact that you are ready to make the switch, then I think that this intangible shift can propel your business to growth.

**Because she is a client of my law firm, I’ve changed some details so that she (and her client) cannot be identified. But the underlying story remains the same.**