Hedge Funds and In-House Counsel
April 20, 2007 | Filed Under Private Equity, Law Firm Trends
The New York Times profiles an increase in deal flow for law firms related to private equity.
Also noted is the need for GCs and corporate counsel with these new and growing companies:
The “demand for general counsel is multiples higher than it was only three or four years ago,” said Alan D. Hilliker, a partner with the executive search firm Egon Zander in New York. Brian Davis, a recruiter with Major, Lindsey & Africa in New York, said, “Until three years ago, we never did a hedge fund search, and now we have had dozens and dozens.”
The draw is both the work and the compensation, which, for senior associates, typically ranges from $400,000 to $600,000 at hedge funds with $2 billion to $3 billion under management, according to Laurie Becker, the president of E. P. Dine, an executive search firm in New York. Partners, she added, can command even more.
Mr. Davis said: “The hedge fund business is diversifying, and they feel like they need lawyers for all the businesses they’re getting into. Funds are looking for transactional lawyers to help to do the deals, and there’s also a big demand for compliance lawyers.”
The liquidity in these markets is touching a lot of people right now. It is one thing to buy businesses; it is another to build them and run them right.
Who gets the work?
April 13, 2007 | Filed Under Law Firm Trends, Managing
The Connecticut Law Tribune provides an interesting glimpse into the world of how GCs select law firms.
A good summary of the process:
Farming out legal work, a survey of 41 companies based in New England and subsequent interviews with their general counsel revealed, is a delicate balance of personal and professional relationships, budget management and hunting for first-class legal expertise. Though legal work often flows to the largest law firms, the survey found there’s room for solo practitioners to carve a niche, even with some big-name businesses.
I have had some very good results with solos who have big-firm experience and a focused area of expertise. It can really be the best of both worlds for a GC, and a good counterpoint to the large firms that are part of the outside counsel roster.
A concise summary of the process comes from Clayton Holdings GC Steven Cohen:
“You get a lot more out of developing relationships rather than parsing out work or creating competition for work, and pitting one firm against another,” Cohen said. “We build up a few very good relationships with firms interested in supporting our growth. We want the firm to get familiar with our business and grow with us. We want the firm to be excited to take our [telephone] calls.”
Any firm that’s not excited to take a client’s telephone calls may find an eerie quiet developing over time.
From OffShore to OnRamp
April 6, 2007 | Filed Under Law Firm Trends, Law 2.0, New Services
Last time, I looked at major companies that are showing an increasing interest in sourcing their work globally.
Today, a gaze into the rearview mirror on a stateside initiative that is gaining traction: Legal OnRamp. More than just a website, Legal OnRamp is a online hub that brings together corporate legal departments and leading law firms. Content, always a staple of law for business, is a starting point. But the brains behind Legal OnRamp understand a key fact about law in the 21st century: what really distinguishes lawyers is how they apply the law and drive business results.
That’s where the vein of value can be deep and rich and provide a common benefit.
To this end, the really interesting parts of Legal OnRamp, from my initial experience, are opportunities to work in a community and collaborate in ways that foster learning in new areas and lawyering in new ways.
The network created by Legal OnRamp is growing. Backed by Cisco and other leading law departments, it is helping ease the friction that can cause the gears of legal commerce to grind a bit.
My colleague in the law.com blog network, Bruce MacEwen, has a great overview of Legal OnRamp, including details on the law firms involved.
Further information is available by contacting Legal OnRamp here or me as well.
Technology is best when it is transparent to the user, so that the focus can be on solutions. Legal OnRamp is one example of how the law is moving forward. Which way are you headed?
Should Law Firms Listen to Students?
April 3, 2007 | Filed Under Law Firm Trends, Legal Ed
The WSJ Law Blog provides an interesting link to a new group of law students, Law Students Building a Better Legal Profession. They raise some valid concerns in their Cluetrain-like manifesto entitiled “Principles For a Renewed Legal Profession.”
It will be interesting to see how this group takes hold. Thus far all members appear anonymous as far as I can tell. Far be it for me to criticize that…
The students offer the suggestion that firms should “link partnership with working hard, not working long…” Actually, partnership, especially equity partnership, is also linked to working on getting and keeping clients. I know when I was in law school I presumed clients sort of grew on trees; certainly there was nothing in the course catalog on legal marketing or client service.
In addition, the group offers that a target of 3,000 hours at some firms (!!) should be reduced to 2,200.
I hope the students continue to do research on this; 2,200 billable (and collected) hours is no small feat, unless you have a year of block-billing-friendly M&A deals or major litigation.
The group seems to understand that you can’t get max pay without max work at a max rate when it notes that members are “…willing to accept reduced salaries in exchange for better working lives.” But when that offer letter arrives with a $150,000 starting salary, it’s really an interesting decision.
The more law students head into their first job with eyes wide open instead of shut, the better. There are initiatives underway to make legal service delivery more productive for firms and clients. I’ll take a look at one of these on Thursday.
Law Firm Listens to Associates
April 1, 2007 | Filed Under Law Firm Trends, Managing
According to legalweek.com, the UK Freshfields law firm walks the talk and actually asks “how high?” when the associates say “jump!”
Freshfields Bruckhaus Deringer was so keen to show it cared about what its associates had to say at an away-day last week that it replaced the firm’s reception carpet within hours of complaints about its colour.
More than 200 associates met with the City giant’s management to discuss issues affecting associates, such as remuneration, appraisals and career development last Friday (23 March).
Following a number of complaints about the carpet, which some described as “80s chic”, Freshfields’ management called in workmen to replace it on the same day, with a “more muted” style.
(ed note: unlike in prior years, this is not an April Fool’s Day joke. Reality beats fiction every time. And the Wired GC is all about “70s chic”, such as this little shag number known as “Flamingo Road”).
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