Blank slate: How NewLaw competes with OldLaw

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Key takeaway points:

1. Use social media to market your firm and win new work

2. Give both clients and lawyers financial transparency

3. Do not overcomplicate your business model

4. Do not follow the recruitment rulebook

5. Embrace flexible working an empower your teams

6. Make added value part of your value proposition

7. Never stop evolving or you will be left behind

 

Having spent many years working in-house and in private practice, a number of things became clear to my business partner and Halebury co-founder, Denise Nurse, and me: there was a gap between the changing needs of in-house legal teams, the career expectations of many lawyers (both in-house and in private practice) and the delivery of services to corporate clients.

From a client's perspective, there were constant pressures on in-house teams to do more for less; budgets were getting squeezed, but regulatory and commercial pressures were constantly increasing. Eight years ago, it seemed that in-house teams had limited options:

• they could approach the locum market (which at that time was not very developed); or

• they could approach traditional law firms (which was an incredibly expensive and inflexible option).

The growth of in-house teams was also a clear signal that traditional law firms alone were not addressing clients' needs; they were bringing the service in-house because external support was too expensive and not commercial enough.

There was always the option of interim lawyers but, at that time, this was a much less developed market. Quality control was not necessarily consistent or obvious to clients and, for lawyers, the interim path was more of an unknown for their careers; the objectives of both parties were not aligned.

We therefore wanted to create a senior service which provided highly experienced in-house lawyers on a flexible and affordable basis and, at the same time, a credible alternative career path for senior lawyers that ensured greater rewards for their efforts. We wanted to give lawyers a unique opportunity to achieve their personalised vision of career success.

A new model

The business model we developed out of this vision was simple and streamlined. When our lawyers are working for clients, they focus on their client work rather than on where their next project is coming from. Instead, this process is led by our head of client resourcing. Our internal team focuses on the regulatory issues and, at the same time, supports the relationship between clients and lawyers, managing the projects to ensure clients have continuity
of relationship and the team have
continuity of projects.

On an individual basis, each lawyer is required to prepare a business plan. This plan sets out their career goals and covers everything from what their remuneration aims are to which contacts/clients they would like to work with. Our management team, led by our head of business development and marketing, work with each of our lawyers on a one-to-one basis to help them to achieve their business plan, providing coaching and training as needed.

This means that each lawyer's business development and marketing strategy is unique and tailored to fit their experience, sector and location. We work to each lawyer's strengths and within their comfort zone, with appreciation for how they like
to market their services and develop
new business.

We feel this model offers clear advantages for both our lawyers and clients. Clients have access to senior, exceptionally experienced in-house lawyers as a flexible, continuous resource at competitive pricing. Our lawyers are all ex in-house lawyers who want to continue to work in an in-house environment, but for a variety of clients. They also want continuity of relationships and assistance with managing their projects so that they are not always alone in searching for their next project or finding ways to increase their remuneration.

Clients want certainty and we give it to them. Therefore, the majority of our billing is undertaken on a fixed fee, discounted bulk hours or daily-rate basis. We do not share profits, we share income; lawyers are remunerated based on set percentages which vary according to their 'ownership' of the client. This means that lawyers who spend time on business development and marketing are fairly rewarded for their efforts but, if business development is not for them, that is fine as well.

However, there are certain disadvantages to our model. For clients, the disadvantage is that we are not a full-service law firm. We provide senior commercial, corporate and employment in-house lawyers within the TMT, sports and financial services sectors. Due to our in-house experience, we are able to project-manage litigation, transactions and projects in most areas, but we do not advise in all areas.

The main disadvantage for our lawyers is that there is no place to hide! The transparency in pricing and structure means that lawyers who are not able to perform at this level are quickly seen. We support our team a huge amount, but they have to be confident in their skills and abilities, and they also have to play well as part of the team and go the extra mile for clients. Being parachuted into a different business, culture and deal is challenging, but this type of scenario is an everyday experience for our lawyers.

Differentiation strategy

The alternative legal services market is becoming increasingly competitive. We are often asked about the difference between Halebury and the other alternative or NewLaw players in the market. Although there are many differences (for example,
we do not have junior lawyers and we are
a fully-regulated law firm), there are two
key differences.

For clients, they have access to senior in-house lawyers on a flexible long-term basis. In contrast to other flexible resourcing businesses which focus more on interim placements only, our team remain available following a placement for follow-up and ad hoc advisory work. This gives each client continuity of support from someone who understands their business.

It also gives each of our lawyers the opportunity to create genuine value for the in-house teams they work with. They can help to develop processes and strategies to create greater efficiencies, based on their experience of working within each team and their knowledge of how other in-house teams operate.

We are very proud of the fact that, in an increasingly competitive market, we are a well regarded and significant player amongst alternative or NewLaw businesses. Given our size and lack of backing of either a law firm or institutional investor (unlike many of our competitors), this means a lot to us. We have managed this by remaining focused on quality. We work with true sector specialists in the TMT, sports and financial services sectors.

Our clients often comment on the seniority and experience of our team as what sets us apart. For our lawyers, no other business offers them the opportunity to be truly entrepreneurial, develop their network and build a long-term career that is more than back-to-back placements. Our lawyers develop their own client relationships, work on strategy with clients and, most importantly, work together as a team.

Overcoming challenges

It is always hard to sell a new concept and this is exacerbated in a traditional market. We found the lack of funding and any ability to obtain coverage in the marketplace really hard. We also set up just before the financial downturn, which meant that many traditional options for funding or support were closed.

When we started in 2007, we were selling a completely new model in a new marketplace, on limited funding and in an exceptionally competitive market. This meant marketing and business development was tough and sponsoring large events or paying for expensive recruitment campaigns was next to impossible. We had to think creatively to increase awareness of our services and to make an impact.

Ultimately, social media has been our lifeline. We connect and network primarily on social media; LinkedIn and Twitter are our main platforms. Our head of BD and marketing is a social media guru and has trained our management team and lawyers.

As the business has grown and, since my move from London to Los Angeles, social media has become our primary marketing tool. I cannot attend many full-day conferences or evening networking social events because I have a business to run, in addition to having three young children to raise. Social media enables me to keep in touch with our contacts and to remain in the loop with issues our contacts are addressing. It really is an invaluable tool.

Irrespective of how good your product or service is, you need the ability to reach prospective clients. We were struggling to reach ours within our highly competitive, protective market - at least at first. In addition, the tough times meant that many clients were more sceptical of new approaches and only the more forward-thinking ones were ready to embrace change. But, the global recession forced many businesses to look again at how things are done and to make major changes. Eight years later, we are starting to see the tide turn and a real interest in new approaches
to legal services from all client sectors.

We put a large emphasis on corporate BD and marketing to develop key client relationships, which result in ongoing work and placements for our team of in-house lawyers. This enables each of our lawyers to tailor their careers and to make the most of their networks and relationships.

We focused on building our brand
and IT infrastructure at the outset when cash was limited. This has allowed us to punch above our weight in terms of standing shoulder-to-shoulder with more established firms when pitching for projects. It has also enabled our team to work flexibly and sustainably from the outset.

We then dedicated resources to attracting senior talent for marketing, BD, recruitment, client relationships and finance. Ensuring that we have an experienced, creative and enthusiastic office team who are empowered to make decisions has paid real dividends for us. We have seen our business grow significantly, in direct alignment with those investments.

Overall, we created the Halebury model from a blank slate. We essentially drew a roadmap of what most parties in a legal transaction want from their ideal scenario, from the clients to the lawyer to the firm as a business. Then we worked backwards to create our business model - from pricing and remuneration to how our legal team works with clients and what their specific career aspirations would be.

We strongly believe that developing the right legal, financial and operational model leads to attracting the right lawyers. If you want to attract truly entrepreneurial lawyers, you need a model that is entrepreneurial and that rewards entrepreneurship. If you want transparency in pricing, you need transparency in remuneration. And, if you want lawyers to be commercial, you need a model that incentivises them to be commercial. It's the basic rule of science and life, the opposite and equal reaction.

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10 LESSONS LEARNT FROM LAUNCHING A NEWLAW FIRM

1. Use social media effectively. Social media is an efficient and effective tool for marketing and business development.

2. Give clients financial transparency. Clients have fixed budgets and are constantly under pricing pressure. They want financial transparency from their legal providers. If we say we can do and have done similar projects, that we are experts in our field, then we should be able to provide them with clear pricing solutions.

3. Focus on sales. You have to develop new ways to reach your market, however closed that market may be. Sales are what keeps your business afloat and drives growth.

4. Develop your team. Many law firms talk about developing their teams, but it is important to know exactly what your team’s goals are, if they mirror the firm’s goals and, if so, they can be realistically achieved.

5. Invest in IT. When you set up a new firm, do so with the best technology available or you will be 10 steps behind before you even start.

6. Do not overcomplicate your model. Business models should not be complicated. The more complicated the model, the harder it is to sell.

7. Do not follow the recruitment rulebook. Look at your recruitment process from all angles, from your lawyers’ career goals to your client contracts to your performance incentives. The right model will attract the right team.

8. Embrace flexible working. More than 80 per cent of the legal profession are looking for greater flexibility, according to a recent survey. Many of our team members work flexibly in terms of hours and location. But, flexibility is not a given, it is very much earned. A team which focuses on outputs, not hours spent, should be able to work flexibly.

9. Make added value part of your value proposition. Many in-house legal budgets are still being squeezed annually. Meanwhile, general counsel are being asked to get involved in more projects and business decisions. The only way to genuinely assist your clients is to find new ways to support them. Don’t just do the deal – help with implementation and with making the next deal more efficient and effective.

10. Never stop evolving. The legal market is changing at a rapid pace. If you want to stay relevant, never stop evolving.

Growth plans

We are now in our eighth year of continued growth. Last year, our turnover increased by 47 per cent, our team grew by 63 per cent and our listed corporate clients increased by 48 per cent. But, we do not take this growth for granted. We are in a competitive, aggressive and innovative marketplace. Our team works hard to achieve this continued growth and we hugely appreciate the faith our clients have put in us.

We are continuing to expand our service range, focused on high quality and sustained growth. Last year, we launched three service lines - Halebury Advisory, Halebury Resourcing and Halebury Consulting - which formalised the work of our teams.

We are developing each service line as well as continuing to grow our team of lawyers to meet client demands. We are not looking to recruit hundreds of lawyers as we are not in the numbers game - it is all about experience and quality. We currently have 30 lawyers and we are looking to have approximately 50 lawyers over the coming two years.

Janvi Patel is chair and co-founder
of NewLaw firm Halebury
(www.halebury.com)