Client concentration risk?
In my first year solo, starting to take stock of how the business has run this year. One thing that stood out is my largest client is 44% of my total revenue, and the top 5 around 80% total.

Does anyone have any insight on how much client concentration risk is too much? Any guidance or insight from those who’ve managed their own operations longer? Note most of my clients are commercial type, with reoccurring litigation

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That’s entirely normal. I left magic circle firms to start my own law firm and it’s the support from the one big client that encourages you and feeds you. Here in the UK the professional indemnity insurers do ask you to list any client which comprises more than 40% of turnover, the theory being that if you are disproportionately exposed to one client you might be tempted to push beyond legal boundaries for that client (I don’t see this myself because a mature relationship with a client does not allow this to happen). So I’d say 40% for any one client but also don’t worry about it. As the years go by and you recruit new clients and staff join you with their own followers, the percentage is likely to reduce.

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80/20 is one of the best principles I learned as a business owner! Also, I recommend picking up a copy of Dave Master's "Managing the Professional Service Firm." Most may be too advanced for where your business is now, but definitely read the section on what business operations increase revenue.

Ideally, no single client is more than 15% of your book of business. But I have the same situation. This time of year is a great time to take stock and update the marketing plan for next year to grow referrals for your firm.

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