Law.com’s Post

Transcript

Law firm result season is here and so far the figures have confounded all expectations. We've had firms like Stephenson Harwood, Osborne Clarke, Fieldfisher, Kennedys and now HFW all turn around double digit growth, some as high as 19%. So what explains this? How is this possible given ubiquitous terms last year like ���high inflationary environment��� and ���skyrocketing interest rates���? Well, the first movers always tend to post quite strong results. These are firms that want the good press. They don't want their stellar figures lost in the haystack of the big law billions that will get reported in the coming few weeks. So what's happening? What explains this double digit growth? One possibility is the benefits of operating in the mid market. Now these firms are all mainstays of the 2nd 100 of the Global 200. Firms that tend not to act on the biggest transactions, nor for the world's bluechips. But they do act for rapidly growing companies, ones that might operate in the AIM market rather than the main market. When last year the deal market quietened, investors hit the pause button on multibillion dollar transactions and instead looked to invest elsewhere and was often mid sized companies that benefited from this. Companies that operate in growth sectors like life sciences and technology and healthcare. Another possibility is international expansion. Now, these are all firms with expansion on the mind. Kennedys, for instance, attributes much of its 17% revenue growth to its US expansion strategy. Osborne Clarke opened its third US office in Miami last year. Fieldfisher continues to make strides in Europe, while HFW said that 60% of its revenue last year was generated outside of the UK. Another possibility is litigation. Now we're all familiar with the counter cyclical nature of litigation. When deal markets suffer, disputes abound. That might go some way to explaining how Fieldfisher, for instance, grew its disputes practice a whopping 17% last year. The big players are yet to move, and when they do, it'll be interesting to see what kind of results they turn around. But what's clear from these early signs is that it���s the mid table that benefited from what few spoils there were in 2023.