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Co-operative Legal Services sees turnover and profit soar - Legal Futures
Co-operative Legal Services (CLS) – one of the original alternative business structures – has recorded a 29% increase in turnover in its last financial year as it consolidates its position as the country’s largest probate provider.

Its recently published results showed that, in the year to 5 January 2019, CLS saw turnover rise from £22m to £28.3m, with profits up 54% to £2m.

The business has recovered steadily since reporting a £9m operating loss in 2013. Turnover – which reached a high of £33m in 2012 – hit a low of £18m in 2015.

Most of the revenue growth last year came from CLS’s probate practice, up 40% to £18.8m. That followed its acquisition in late March 2018 of Simplify Probate, then the UK’s second largest provider of probate, from the group that owns QualitySolicitors.

The accounts reveal that CLS paid £1.7m and took on net liabilities of £2.6m to secure the deal.

CLS has been moved into the Co-operative Group’s funeral and life-planning business in recent times to encourage cross-selling.

Personal injury is CLS’s other big practice area, although its revenue only increased marginally to just over £5m.

Income from will-writing was up 44% to nearly £2m, claims handling up slightly to £2m, and family law increased 42% to a little over £1m.

Staff numbers at the end of the period were 360, up from 321 a year earlier. The highest-paid director received £339,000.
access  innovation  clementi 
28 days ago by JordanFurlong
Law firms are investing in innovation through venture capital services
Home Daily News Law firms are investing in innovation through…
PRACTICE TECHNOLOGY
Law firms are investing in innovation through venture capital services
BY ARI KAPLAN

JUNE 21, 2019, 6:30 AM CDT

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Ari Kaplan.

Ari Kaplan spoke with Alex Nwaka, a principal with Touchdown Ventures, which provides venture capital services on behalf of leading corporations.

Ari Kaplan: Tell us about your background and your role at Touchdown Ventures.

Alex Nwaka: I started my career as an investment banker at Morgan Stanley and UBS in New York City covering the energy industry, went to Columbia Business School and then spent some time at Virgin Management, Richard Branson’s family office, performing a combination of venture capital, private equity and corporate development work. After Virgin, I worked as a private equity consultant at Estee Lauder Cos. on their new business development team, helping to reorganize their M&A strategy. I joined Touchdown four and a half years ago as the first full-time hire. In the last year and a half to two years, I have focused on enterprise software and the future of professional services. Legal tech is among the categories on which I spend my time.

Ari Kaplan: How does the company’s model of providing venture capital as a service work?

Alex Nwaka: We believe in strong collaboration with our corporate partners, where each party brings a valuable perspective. Touchdown brings the venture capital expertise, which includes sourcing, diligence, deal execution, deal management, including board representation and commercial relationships, through an exit. We also handle some of the reporting and monitoring of the portfolio as well. Our corporate partners bring deep industry expertise from their vertical or the category in which they operate. Together, we make a complete team combining the VC and operating knowledge.

Ari Kaplan: What are the advantages?

Alex Nwaka: We collectively can bring significant strategic value to our portfolio companies either as customers, channel partners or as a general sounding board for go-to-market strategy and even product development in the broadest sense. We are more than just a check to the founders and entrepreneurs that we invest in. We really try to bring strategic value.

Ari Kaplan: What types of organizations are investing in legal tech?

Alex Nwaka: We are finding most often that law firms are one of the key constituencies investing in legal tech. Corporate legal departments and GCs within Fortune 500 corporations are also investing in legal tech. And, to a much lesser extent, institutional venture funds are playing around in the ecosystem as well.
innovation  firms  clementi 
july 2019 by JordanFurlong
Exclusive: Unregulated virtual firm granted SRA waiver - Legal Futures
One of AGL’s selling points to lawyers is that it says they keep a greater share of the fees they generate – up to 90% – than any of the equivalent firms, of which there is a growing number, such as listed law firm Keystone Law, gunnercooke and Carbon Law Partners.

At the moment, solicitors working for unregulated businesses have to call themselves non-practising, but the AGL waiver means that any solicitor working at the firm can operate under their title without having to seek an individual waiver.

Founder Lindsay Healy is a former Norton Rose solicitor and latterly a general counsel at technology company Xchanging.

He set up AGL last year to offer a wide range of commercial law services. It started with him and two clients and now has 15 lawyers and 80 clients.

Mr Healy outlined major ambitions for the firm, which he said would have 19 lawyers by the end of June and could reach 75-100 by the end of the year.

Every lawyer at AGL can work flexibly and everyone – including Mr Healy – is paid in the same way and receives an equal share in the profits. “Nobody takes profit from anyone else’s work,” he said.

Lawyers retain an initial 85% of what they bill; the remaining 15% goes towards AGL’s overheads, but whatever is left after that is distributed back to the lawyers as profit – in proportion to the hours they have billed – less 5% donated to charity, which is currently Great Ormond Street Hospital.
clementi  newlaw 
july 2019 by JordanFurlong
Mayson spells out hard choices in reforming legal regulation - Legal Futures
He restated his belief that professional titles were a “limiting factor in the development of regulation” and said that it “might be sensible” to move away from them, to a future where all ‘lawyers’ were regulated by activity.

However, he said that how far it might be possible to shift away from titles remained an “open question”.

The academic – who is undertaking the review with the support of University College London – said one of the problems with activity-based regulation was how to define the activities and he referred to Scotland’s independent review of legal services regulation, which found that this could actually increase the number of regulators.

“You could end up with more regulators than we have now, each regulating a different activity. It’s still a complex mosaic whichever way you cut the cake.”

The Law Society strongly defended title-based regulation in its response to the Mayson review in March this year and called for the public to be better educated about professional titles.

Professor Mayson said he agreed with the conclusions of the Competition and Market Authority’s study of the legal services market in describing the current framework as unsustainable and saying the justification for some reserved activities was stronger than for others.
regulation  clementi 
june 2019 by JordanFurlong
Plexus chief: PE investment is "entirely different" this time - Legal Futures
The recent cash injection into Plexus Law is “an entirely different deal in entirely different circumstances” from its failed first foray into private equity backing, its chief executive has told Legal Futures.

Fiona Scott also said Plexus aimed to be the leading national defendant law firm, filling a “huge gap” in the market left by many of the big insurance law firms focusing on their international practices.

Earlier this month, Plexus announced a £15m investment from Origin Equity. Back in 2012, the Parabis Group – of which Plexus was part – was the first law firm to be bought by a private equity business, Duke Street.

But the group was broken up in a pre-pack sale in November 2015, with Plexus returning to the ownership of its founders.
clementi 
april 2019 by JordanFurlong
Co-op sees legal services turnover and profit soar - Legal Futures
The Co-operative – now the largest provider of probate services in the UK – recorded a 37% rise in turnover from legal services in 2018, and a 53% jump in profit.

The legal services business – which is part of the Co-op’s life planning division – saw its income reach £34.9m in 2018, up from £25.5m the previous year, with profit increasing from £1.5m to £2.3m.

The results reflect the acquisition a year ago of Simplify Probate, then the UK’s second largest probate provider, whose 170 staff took the total staff number at CLS to just over 600.

Like-for-like revenue taking out the acquisition of Simplify was up 12% last year.

The Co-op’s annual results said Simplify Probate has been “successfully” integrated: “Our clients are already benefiting from faster distribution of estate proceeds. In 2019 we’ll continue to offer probate services as part of our funeral support to families.”
wills  clementi  competition 
april 2019 by JordanFurlong
Why law firms can’t compete | Canadian Lawyer Mag
While fixing law firm capital structures is entirely within a firm’s control, extending ownership to non-legal talent is not. The list of potential key players is long: business and HR executives, technology professionals, project managers, accountants, business process specialists, design-thinkers and administrative professionals, to name a few. Our competitors are winning the battle for this talent because they can attract, retain and align key talent (irrespective of specialty or background) around a common goal through ownership in the enterprise. Unfortunately, law firms do not currently have this option. Even if we can set aside our egos and admit that non-lawyers play a meaningful role in firm success, we are prevented by regulation from opening our capital structures to attract and retain this talent. Without this important tool, we are giving our competition a head-start in the race towards improved access to legal services and better client service — the foundations of our professional mandate.
clementi  governance 
february 2019 by JordanFurlong
DWF unveils plan for blockbuster stock market listing - Legal Futures
The blockbuster listing – likely to value the firm at around £600m – would make at least 25% of the firm’s shares available to investors. Though no figures have been released yet, DWF is thought to be looking to raise £50-100m.

The selling partner shareholders would hold a majority of the shares after admission.

DWF has 27 offices in 14 jurisdictions and employs 3,100 people focusing on insurance, financial services and real estate. It has a connected services division made up of 12 businesses offering other services around the legal advice.

In a ‘potential intention to float’ notice published today, the firm said it saw “a large consolidation opportunity… in a highly fragmented global market for legal and connected services”.

It said the acquisition growth strategy would focus on international expansion and accelerated development of the connected services division.

On the latter, it said: “Acquisition priorities are to: (i) acquire new product, software and technology capabilities, (ii) improve the geographical coverage of existing service lines, (iii) gain additional complementary services and solutions for DWF’s practice areas and specialisms and (iv) build out DWF’s current consulting capabilities within the connected services market to take advantage of the sizeable market opportunity.”
clementi  innovation  newlaw 
january 2019 by JordanFurlong
Reed Smith Eyes US Merger and Plans ABS Conversion | The American Lawyer
Reed Smith is aiming to move its Europe and Middle East arm to an alternative business structure, or ABS, by early next year, as the Pittsburgh-based firm also considers a domestic merger to bolster its coverage in the United States.
The American Lawyer affiliate Legal Week revealed last year that the global firm was considering converting its Europe and Middle East arm to the ABS structure in order to “future-proof” its operations.

Europe and Middle East head Tamara Box has told Legal Week that the firm is “absolutely planning” to move to the structure with the goal of completing the process in the final quarter of this year or the first quarter of 2019.
“We want to use that structure as an agility tool to ensure we are nimble enough to service our clients in the future,” Box said. “We operate as a global profit pool, so we have had to manage regulatory issues within different jurisdictions to clearly preserve that.”

An ABS conversion allows law firms to bring nonlawyers into its equity and share profits, and Reed Smith, which ranks 25th in the Am Law 100 and 32nd in the Global 100 with $1.1 billion in revenue, is attracted by the potential of closer integration with teams or businesses run by nonlawyers who could offer something different to its clients. The ability to share profits would help Reed Smith attract and retain senior staff on the consulting side.

Meanwhile, the firm—which lost a large group of lawyers from its Philadelphia office earlier this year—is also considering where it wants to bolster its U.S. operations and how best to do so.

One London Reed Smith partner said they felt the firm was “trying to gear us up for a possible merger” at the firm’s partner conference held in Orlando earlier this year. The partner said that while nothing specific was discussed, partners were given “soft messaging” about opportunities.
clementi  merger 
october 2018 by JordanFurlong
Tensions in Legal Services Act coming to fore, says review - Legal Futures
“The world that existed in 2004 simply does not exist in the same way now, and the inherent tensions in the 2007 Act are becoming increasingly apparent.”

The paper went through these in detail, from the “inflexibility” of the Act – concerns over the move away from self-regulation that it entailed meant “much prescriptive and protected detail was ‘hard-wired’” into it – to the “competing and possibly inappropriate regulatory objectives” that are at the Act’s core.

“For example, the objective to protect and promote the public interest does not always sit easily with another to protect and promote the interests of consumers, or with yet another to promote competition in the provision of legal services.”

Reflecting work Professor Mayson carried out in 2010, he said the “pivotal” and limited set of reserved activities were “anachronistic and do not necessarily include all activities that ought to be regulated”.

Further, title-based authorisation of lawyers resulted in additional burden and cost in relation to some activities being regulated that do not need to be – even though Parliament has decided that only the reserved activities have to be regulated, as soon as someone is authorised as a solicitor or barrister, “their regulator will then assume jurisdiction over all of the activities carried out by that person, both reserved and non-reserved”.

It has also led to multiple regulators overseeing the same activity in different ways, as well as a regulatory gap that exposes consumers to potential harm from unregulated providers “and puts qualified practitioners at a competitive disadvantage”.

Other problems were “an incomplete separation of regulation and representation” at the Law Society, Bar Council and others, and “the potentially misconceived ‘mission’ basis of regulation and regulators”.
regulation  governance  clementi 
october 2018 by JordanFurlong
LawNext Episode 9: Bill Henderson on Changing the Non-Lawyer Ownership Rules | LawSites
Should legal ethics rules be changed to allow non-lawyer ownership of legal services providers? So controversial is the question that it was major news in July when the State Bar of California voted to appoint a task force to study and make recommendations on the issue. What spurred the bar to take this action was the Legal Market Landscape Report it commissioned from William D. Henderson, professor at Indiana University Maurer School of Law. Henderson is my guest on today’s episode to discuss his findings and recommendations.
regulation  governance  clementi  ethics 
september 2018 by JordanFurlong
The Law Firm Disrupted: Outside Ownership of a Law Firm Alert! | Law.com
Silicon Valley startup Atrium Legal Technology Services Inc. receiving $65 million in funding from some big-name investors. Plink asked what I thought about Atrium, and I had to be honest: I’d been on vacation most of last week and since returning had been too tied up with other deadlines to look at the news.

So here is the news if you’ve not read about it already: Atrium, in the span of about a year, has provided flat-fee legal advice to 250 startups that collectively have raised more than $500 million. It has hired about 115 people. The company is half law firm, half software developer; the software developed being used by the law firm to automate simple tasks. Got it? O.K.

The $65 million investment is exciting. For a number of reasons. For one, it’s about $30 million shy of the annual gross revenue of the No. 200 firm on The American Lawyer’s annual Second Hundred list.

But most germane to Big Law, in my mind, is that it’s another way to get outside money into a law firm, which I’ve been writing about a lot lately. I continue to believe outside investors are one of the most effective ways to overcome barriers to innovation inherent in the partnership model. Mostly because they allow law firms to think long term.

After reading about Atrium, I find myself asking: Why can’t other law firms do this?
clementi  innovation  startup 
september 2018 by JordanFurlong
Simpson Millar unveils £50m plan to become leading consumer legal brand - Legal Futures
Cox: Firms need scale

Simpson Millar has unveiled a five-year £50m growth strategy to become one of a handful of consumer legal brands, starting with the acquisition of Liverpool practice EAD Solicitors.

The announcements are a major statement of intent by the firm, after it suffered under the ownership of Fairpoint Group PLC, which delisted and collapsed in August 2017, and had to cut 20% of staff last year as a result.

Simpson Millar has bought EAD through an administrator, but chief executive Greg Cox told Legal Futures that “the core EAD is actually very sound” – work such as personal injury (PI), clinical negligence, trade union and employment.
clementi  access  innovation 
september 2018 by JordanFurlong
Co-op: We're now the UK's largest probate provider - Legal Futures
CLS: Sales are continuing to increase

The Co-op has declared itself the largest provider of probate services in the UK as its financials continue to improve.

The group’s interim results today show that revenues at Co-operative Legal Services (CLS) in the first half of 2018 jumped 31% to £16.1m, compared to £12.3m in the same period last year – which was itself a significant improvement on the year before.

Profit for the six months quadrupled to £800,000 when compared with 2017.

Earlier this year, the Co-op acquired Simplify Probate, the UK’s second largest provider of probate, whose 170 staff took the total staff number at CLS to just over 600.

Simplify Probate was part of the Simplify Group, which also includes QualitySolicitors and residential property services company Move With Us.
clementi  wills  access 
september 2018 by JordanFurlong
Comment: Law firm IPOs still don’t make much sense (but soon could)
‘Who would possibly invest in a law firm?’ asks one leader this month, reflecting a common view. Yet the current vogue for floating law firms suggests momentum is indeed building, more than a decade after the introduction of the Legal Services Act.

In recent weeks, DWF has turned heads with talk of a £1bn float this year. While the price – not officially attributed to the firm – looks fanciful, even a standard £400m-£600m valuation would be by some way the largest legal float yet seen. The last 12 months have seen a series of offerings, with Knights in June raising £50m and others recently braving the market, including Rosenblatt, Gordon Dadds and Keystone Law. And while larger commercial law firms publicly play down the prospects of raising outside capital, there is no doubt it is now getting more active consideration.
Yet for institutional lawyers, the basic tension in attracting outside shareholders remains. Large law firms generate plenty of capital and have the advantage of an owner/manager structure that closely aligns to the business’ needs and interests. It has never been that clear how the very different incentives of outside investors can be aligned with partners, beyond giving a payout to older partners, a poor outcome for the business as a going concern. Law firms are built on ‘elevator assets’, partners bred to expect huge autonomy make a lousy bet for outside shareholders.
clementi  newlaw 
august 2018 by JordanFurlong
DWF weighing up £600m listing on stock exchange - Legal Futures
Stock exchange: DWF would be sixth firm to list

Top-25 practice DWF is considering whether to become by far the largest law firm to list on the London Stock Exchange, it emerged today.

The move would galvanise interest in law firms going public, and based on valuations of those that have made the move to date, the firm would be valued at about £600m, although some reports have put it at £1bn.

There are currently four law firms on the market – Gateley, Gordon Dadds, Keystone Law and Rosenblatt – with Knights set to become the fifth.

The Lawyer lists DWF as the 23rd biggest law firm in the country, with revenues in 2017 of £201m. Profits in its last couple of financial years have been around the £45m mark.

In a statement released today, DWF said: “To enable us to deliver on our strategy and for us to better serve our clients through an increasingly international and differentiated offering, we have plans to increase our investment in information technology and Connected Services.”

Connected Services is a standalone company that the firm has described as forming “an umbrella over a range of complementary specialist business solutions, as well as consultative services and products, that sit alongside DWF’s core legal offering”.
clementi 
june 2018 by JordanFurlong
Turnover up at Co-op Legal as it unveils Simplify Probate acquisition - Legal Futures
The Co-op has acquired Simplify Probate, the UK’s second largest provider of probate, as it bids to become the dominant player in the market.

It has also unveiled a 13.6% increase in legal services turnover for 2017.

Simplify Probate was part of the Simplify Group, which also includes QualitySolicitors and residential property services company Move With Us.

Simplify Probate has 170 staff, taking the total staff number at Co-op Legal Services to just over 600. The price is undisclosed, even though it is likely to appear in the Co-op’s accounts next year.

As part of the deal, Co-op Legal will work in a strategic partnership with Move With Us, and its sister businesses DC Law and JS Law, to handle the property and conveyancing requirements arising from estate administration work.

It will replace the three firms on Co-op Legal’s conveyancing panel.

Last year, the Co-op brought its legal services operation together with its much larger funerals business to create a Life Planning division. It handled 16,342 legal matters last year, up 321 on 2016.
access  clementi  wills 
april 2018 by JordanFurlong
What can we learn from the English ABS experience after five years? – Slaw
What appears to be clear is that not much has happened in England as a result of ABS liberalization. The conclusion of the 2017 LSB Report is essentially that existing practices have not had to innovate because they have not faced strong competition particularly from new entrants. But the report does not address why relatively easy entry into the legal services market and the fact of unreserved areas of practice have not led to increased competition.

It may be that the emergence of new entrants simply takes time. It may also be that existing legal practices are reasonably well suited to the work that they do and that there isn’t substantial profit to be made serving existing reserved legal markets though new forms of practice.

So the implication of the first five years of ABS liberalization in England is that it has not led to much accessing of external capital nor to much innovation. At the same time, it does not appear that ABS liberalization has led to significant problems either. That said, spending substantial regulatory time and effort to enable a significant regulatory change of rather limited impact does not seem like a great use of resources.

Of course, things don’t necessarily stay the same. It is clear that technology continues to advance significantly. There is ample evidence that unlicensed direct-to-consumer legal services are being provided in Canada and that the volumes are likely to increase especially as technology evolves. It seems logically to follow that this will lead to competitive pressure on existing legal practitioners who will require access to external capital to respond effectively. There is a credible argument that limiting access to external capital will handicap existing practices against new entrants.

But it must be admitted that these credible arguments are not yet supported by market evidence in the very significant and competitive English market. The dilemma is that there isn’t cogent current evidence for regulatory reform while our ability to respond nimbly if and when required is doubtful. In resolving this dilemma, my inclination is to watch and wait given the advantage of having the English “experiment” to guide our thinking.
clementi 
march 2018 by JordanFurlong
ABSs top the 1,000 mark as research highlights changing face of legal market - Legal Futures
he wake of ABSs have proven to be unfounded.

“However, looking beyond these overall numbers, there has been some downsizing in many firms and the dropping of under-performing practice areas.”

The report said the “flip side” of larger law firm closures was the emergence of new boutique and virtual firms, with the result that the total number of law firms had stabilised at 10,408 – an increase of 0.5% on the previous year.

The report found that the proportion of law firms made up of incorporated companies rose from 37% to 44% since January 2016, increasing from 3,859 to 4,580.

This figure excludes LLPs, which made up another 15% of the total, leaving traditional partnerships, “for a long time the dominant model in the legal sector”, with a share of only 17%.

Growth in the legal services sector as a whole bounced back in 2017, after a 2.2% dip the previous year, with a 3.8% increase in total revenue, taking it to £32.7bn.

With the exception of 2016, the report outlined a pattern of strong growth for legal services since 2010, with increases in turnover ranging from 1.6% (2012) to 10.6% (2013).

The report forecast growth of 4.2% for this year, rising to 5% in 2019 and 5.8% by 2020.

“By 2021, the turnover of legal services companies is expected to reach over £40bn, representing growth of 22.7% from 2017 to 2021.”
clementi 
february 2018 by JordanFurlong

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