How does law firm partnership happen?
failed in london 11 May 22 06:45
Reply |

Are you identified early on and given little hints along the way and then "asked" to put your case? Or is it up to you to push the agenda? If you were a perfect associate but never mentioned it, would it just never happen? Do people ever get compelled to take it even if they DGAF?

Do you have to behave like a partner in waiting or is that a bit gauche? Can you recover your position in the race if you start off shit and a bit naive?

Is it really about anything more than being liked by the right people on quite subjective criteria?

I'm in-house 4life so no stake in it all, just curious.

 

early days people dont mention it - if you survive long enough people start to talk about your "next steps" and "building a following" - if you are still there around the 6 - 8 mark at slaughters or 8+ elsewhere they start talking specifically about the "track" and how it works.

basically multiple rounds of interviews, presentations, can be a business plan you have to put together for your department etc. can take 6 months to a year - then they say "oh not this year smithson, theres not the space on the bench, but next year will be your year" ad infinitium until it actually happens - if they are serious about making you up, they give you a big chunky bonus or salary increase to make you stomach another year of show round. 

if they think nah no revenue there or w/e. they just say not this year and it will have been so horrible that you probably leave if you dont get the sweetener. 

Some dont get the message and hang around until like 15 year PQE and sometimes, just sometimes, they feel sorry enough for them they make them up when an equity hogg retires and they can adopt their book of work. DOBBY WAS GOOD SENIOR COUNSEL YES YES? 

Yep I’ve been seeing a few of those partners Billy mentions getting made up recently - the ones who no one ever thought would make partner but get made up in their late 40s.

It’s one of the most bizarre processes in the world of work. Basically it’s a ‘does their face fit’ model from the moment someone is about 7yrs PQE. Plenty drop by the wayside to have kids, go Yank or create their own coffee blend. At that point it’s theoretically about new business potential but the reality is most junior partners in my old shop were simply given clients by the very senior/retiring partners. So they actually had to win nothing themselves despite the fact that that’s meant to be key. Which goes back to a ‘does their face fit’ question. 

Much easier to be a lateral hire partner later on, make up a client following and not have to go through the bullshit. 

Friend of mine just went through it:  he was a lateral hire, and partnership track was part of the hiring discussion.  The question then was (a) what type of partnership and (b) if and when due to the voting requirements.  Senior mentors and champions, the growth trajectory of your business as well as the firm strategy were key!  In a nutshell, if senior people do not bring it up in informal discussions well ahead of time, forget about it! 

In-house the signs are more difficult to read: 'we will take care of you', 'you are one of the people we absolutely want to keep', 'let's talk about your next step' are some of the indicators. But most of the time people will not say openly that 'you are on the fast-track'. 

 

 

Fast track to what?

Most in house roles don't have a partnership to join. Surely into work at you just wait until someone dies or retires then shuffle up a notch. 

there are quite a few fast-tracks in the more commercial roles.  In the support functions, there are also some fast-tracks to more senior roles but not as many.... 

Yes you basically have to walk the walk long before you get it 

But you are beholden to those (older whiter straighter men) above you actually putting you forward. From my experience the knock back comes long before the actual interviews and applications and stuff, it's more informal. 

By the time you are sitting in the interview they have already decided 

10-14 pqe sounds about right these days. Although I have a feeling it's also done on age (albeit not expressly....) So hardly anyone gets it at non MC/yank firms before 35.

The skies darken, the shroud over the photocopier is rent in two, people carry their children to safety, a great eggy fart smell descends over all the land and a bead of light appears over you and you alone, and while you spazz about in panic looking for then source of all this, a little fat man in a gimp suit clambers out of the bottom drawer of the filing cabinet and everyone shrieks, then there is silence as he passes you a pair of pants woven from a mix of wire wool and ginger pubes, and you are bidden to put them on, which you do and the crowd murmers ‘all hail Pubert’ and then the little fat man takes a knife and cuts off one of your tits and tells you that you have to buy it back with the souls of those who now work for you. Then Angela from accounts asks for your bank details. 

Think of it like a childhood penicillin v tonsillitis dream in an office setting and it all makes sense. 
 

 

sort of.

My favourite part is that Angela keeps needing your account details.  And only Angela is ever able to know what drawings are due and when.

FD never does. And wanders the corridors muttering darkly about HMRC never getting the codes right.  Only to be seen at partners retreats armed with a powerpoint where all are exhorted to "be more like Giles" only to find Giles has been charging like a wounded rhino and padding like the Bed of Ware with unpaid bills aplenty and a minor self-reporting to the SRA.

And no-one can ever find Angela unless it's in response to an email re account details.

They were sending me "balancing cheques" three years after I had left the ruddy partnership.

Be more like Giles and get arrested by HMRC and the Vice Squad in a dual raid at the Nottingham Travelodge during the Tax department offsite. Last seen being bundled into a van with jangling chains attached to a precarious skull and crossbones Prince Albert shouting ‘tell Darren to torch the lock-up’

With equity, do you have to actually stump up the cash, or do they in effect lend you the money to buy in which you then repay out of drawings?

You get a loan from a bank which you pay interest on, but also get paid interest on (and last time I checked it was slightly in my favour).

Depends on firm + practice area. Kirkland corporate and debt teams will make confident 6/7 peekers up who can blozz precedent SPAs and debt docs for 2.5k hrs with half a smile on their face (docs don’t even have to be that great). 

In other places, unless you’re an anointed one as others have noted above or at an MC firm with shedloads of volume, you have to generate serious biz. Nobody below 12-14pqe is generating a mill plus of work these days as partners are refusing to retire...

In some places you dont put anything in and dont take anything out (eg CC). In others you have to acquire a significant slice of capital on arrival in the partnership and contribute annually thereafter plus a sum relating to the self l-insured part of the PI  liability stack. For this you can take the firm’s bank’s loan and your interest payments are deducted from your partner draw. But you can set off interest payments against tax each year and, as subterfuge notes,  the interest paid on the loan and the growth of the capital can be in your favour. This all depends on how the business is growing versus interest rates offered by the bank in question. Quite a difficult range of variables to predict. 

Jack, it's Jeff.  And well spotted.

Prob - too many people taking equity do so blind.  One advantage of going in on a lateral is there is usually an expectation of have a look at the accounts properly (unless reported and even then against the management set).  Have previously avoided going somewhere shiny having been warned off by my accountant chap. Didn't end well for some.

Have a look at Ince for example - creditor position is a mess as between bank and partners and ex partners. Never ceases to amaze me the p1sspoor way law firms are managed (esp on the finance side).

I would defo want to scrutinise the accounts before buying in at my shop. I don’t have a huge amount of confidence that the EPs are actually making more than I am as a salaried partner.

The drawbridge is certainly being pulled up that's for sure.

No wonder so many people leave the profession. Years of slogging it out to be told 'maybe next year'.

Only ever happens if there is a big enough client pull / leverage. Otherwise, you can be merrily grinding away, year after year, and find that the firm brings in laterals on the basis that they have half a client following and will take the half that you had hoped to inherit. Then it turns out that the half they said existed didn’t, but by then they’re established. The difference is that the firm knows you haven’t got enough of a hold over the clients that you could lure a material number of them away, so they can tell you to fook off if you don’t like it, whereas they are easily deceived by the lateral’s false claims.

Predatory marketing works sometimes. If you work at firm A and you spot that firm B has a very large client that is solely dependent on one senior partner who keeps all the work, is due to retire soon, and has made no real succession plans.

You stick a good partner and a couple of very good senior associates on it.

You win the work and the senior associates become partners.

No actual firm names in this post, but it went on (I orchestrated it) and probably still does.

You can do it in reverse chambers - ie spot an opening at another firm and step in to fill it knowing you will inherit the whole lot when the senior person goes.

A lot of firms (even big ones) are always trying to bolt on particular specialisms or sectors so there is loads of scope for movement 

There was a bit of pushback to that plan. From people like Ducks. 'You can't take a chap's clients, its unethical, there'll be hell to pay down the club' etc.

Didn't stop us, and yes Davos you can do it in reverse but more difficult.

tbf to Chambo, he only orchestrated the client raid and lucky SA's promotion after confirming that said SA was a decent chap and knew his rugby.

The SA (now newly-minted partner) made sure to buy Chambo a pint down the Drummond as a thank you.