Case study: Mid Size Firm Combination

The challenge:

● Find and execute on optimal growth strategies

● Help to evolve the firm in line with current legal marketplace demands

● Maintain culture and client-value while staging for strategic growth

● Build consensus around market-based solutions to growth obstacles

Approach

EvolveLaw’s client was a market-dominant mid-sized firm — one of the few remaining larger, independent and foundational firms in its HQ city. Today’s market demands that firms in this position compete with an ever-growing list of national firms setting up shop in its market. The client wanted and needed to adapt and grow to meet this challenge.

After analyzing the firm’s operations and finances, EvolveLaw facilitated the firm’s next steps. EvolveLaw helped the firm assess its position in the market and agree on the firm’s strengths and the obstacles to continued growth and success. One of the biggest obstacles to law firm change is consensus and shared language. The foundation for that consensus is a shared understanding of who they are and where they want to go.

With that foundation, EvolveLaw assisted the firm to set and begin to execute goals to maximize its strengths and adapt to client demands, putting the firm in the best possible position to grow well. For example, EvolveLaw partnered with data scientists to use firm and market data to help the firm define its existing industry strengths, focus on growth industries in its markets, and launch internal industry groups to approach clients with deeper industry perspectives and more targeted services. The firm also changed its compensation structure to encourage teamwork, cross-selling, and industry- and teamwork-driven practice development.

With operational and practice goals in motion, EvolveLaw helped the firm to home in on specific strategies for growth. Every firm culture requires different steps and levels of inquiry to continue to build consensus on growth. This firm was no exception. Its culture and history demanded a measured approach, considering group acquisitions, then smaller firms. With help from a strategic recruiter, we examined more than 30 groups and firms. For each, we assessed basic financials, practice and industry mix, geographic reach, and culture — quickly dismissing groups and firms whose governance or compensation systems and cultures posed obstacles and engaging efficiently with those that could be a match.

At each step, EvolveLaw leveraged its connections and broad marketplace knowledge to introduce opportunities to expand the partners’ vision. Over time, the firm looked “upstream” at potential “mergers of equals” and larger firms whose bench, reach, and culture matched the firm’s goals and enhanced chances of significant client growth. Once there was consensus on that larger-firm strategy, we vetted 30+ firms encompassing a broad range of geographic markets, then prioritized and pursued more than 10 that met our selection criteria. After initial discussions and the exchange of high-level information, we narrowed the list to 3 primary targets and began to exchange information and meet with the right partners and other leadership to examine the possibilities deeply. After intense examination, we narrowed to one firm, analyzed the finances and demographics of the possible combined firm, and moved forward.

EvolveLaw’s client negotiated a mutually advantageous merger agreement, and the combination is well on its path to success.

Essential to this path was EvolveLaw’s partnership with Bill Horton, an experienced extremely talented financial executive whose product and strategic financial skill set allowed the client team to quantify and evaluate each of the growth alternatives presented throughout the process. This involved creation of financial models, profitability analyses, creation/comparison of key performance indicators (KPIs), and partner compensation comparatives. The combination of Bill’s expertise and EvolveLaw’s strategic analysis and approach allowed the client to select and vet the right path to successful growth.

At EvolveLaw, we understand that you can’t come into any situation with preconceived notions or a canned approach. We work with each client to meet them where they are and emphasize a collaborative, incremental approach that meets each client’s specific needs.

Impact

EvolveLaw’s client mapped its course and executed a growth strategy to maintain its unique culture and market dominance, expand its bench to meet client needs and grow client representation, and retain its key talent to catapult its practices into the future.

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