Writing in the American Lawyer this week, Keith Fall and Ross Weil argue for law firms to consider amplifying their existing private equity practice in a piece entitled “For Law Firms, a Deep Dive Into Private Equity Can Be Lucrative.” As dry powder and valuations continue to skyrocket, and, as noted in the Financial Times last week US PE deals “hit highest level since 2007,” it would appear to be a profitable time for law firms to invest time and capital into this practice.
Per Fall and Weil, these practices should begin to grow relationships and “target up-and-coming fund managers in the lower middle market.” The article continues to expand on a point that the Source has often made for intermediaries – by targeting boutique, or newer to market advisors (or in this case, equity funds), you can be one of the first to do business with a firm that may be starting off with smaller deals with the intent of growing and increasing their portfolio overtime. As the authors opine, “law firms seeking new sources of revenue would do well to follow suit.”
The middle to lower middle market is where the bulk of transactions trade in this market. As a law firm trying to grow your corporate, finance, or private equity practice, the SPS Portal is the business development tool built with your practice’s strategy in mind. In 2018, there were more than 4,530 unique attorneys that advised on at least one transaction, representing more than 635 law practices. Moreover, when reviewing a legal advisor league table, 68% of law firms advised on one-to-three deals in 2018. That’s a lot of competition to confront in a formidable market.
To help manage and grow a law firm’s private equity practice, several firms have instituted business development and marketing teams to focus on building these practices and new relationship sources. As we’ve noted before, these professionals have a peculiar task focused on supporting partners to grow business, as well as their position in the market, in a quasi-sales position. For these professionals to add value for partners, they need access to actionable data.
Combining the power of private equity and M&A transaction data within the SPS Portal with existing internal and personal relationships empowers legal advisors and business development professionals to leverage their business network in a more robust manner. Querying SPS transaction data, using different filters and target criteria, can transform M&A business development by directing you to those newer funds entering into the market that can help grow your practice. People prefer to do business with colleagues they know and trust, or those who are in their network. Relationships cultivated through an advisor’s historical transactions is an untapped data-set that could lead to your next transaction, and a new source of revenue. To learn more about how the SPS Portal can help your law practice source new revenue sources, or to see a demo, contact us!
Last week’s deals todayJanuary 8 – 11, 2019 ~163 deals closed
Deal of the weekVista Equity Partners completed its acquisition of Apptio Inc. last week for $1.94 billion. Qatalyst Partners acted as the sell-side advisor for this transaction. The Bellevue, Washington based Apptio is a developer of technology business management software designed to assess and communicate the cost of IT services for planning, budgeting, and forecasting purposes.
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