Dr George Beaton reports exclusively for LawFuel on the ReInvent Law conference in New York last weekend.
Hot on the heels of the recent story in LawFuel featuring George Beaton and NewLaw New Rules, his new book on trends in the legal services industry, he has sent this exclusive report to LawFuel from the February 7th ReInvent Law conference in New York.
Two significant legal industry events created a buzz among the 800+ delegates at the conference. While not directly related, the collapse on February 5 of Heenan Blaikie, a venerable Canadian BigLaw firm, and the announcement on February 7 of British Telecom’s appointment of Axiom Law, a NewLaw firm, to handle commercial and anti-trust matters whet the delegates’ appetites.
Heenan Blaikie was a 500 attorney, 40 year-old firm with former prime ministers and judges as partners. Falling profits, tensions between offices, leadership difficulties and an never-ending adverse environment for law firms, resulted in monumental flight of partner and an abrupt dissolution.
In contrast, Axiom Law is a 12-year old firm serving many of the Fortune 100 from offices across the world. Axiom has won BT work related to commercial contracts and anti-trust in the UK, US and Asia.
Tough reading for BigLaw
The concurrent announcements must make tough reading for BigLaw firms (a business model description) and provide inspiration for NewLaw businesses (also a business model description).
BigLaw is still very profitable industry.
The thousands of BigLaw firms around the world are resilient and clever and their owners have a big stake in ensuring the continued prosperity of their firms. Continued prosperity will require substantial transformation of their business model to meet clients’ changing demands.
ReInvent Law speakers were divided on the prospects for BigLaw’s appetite and capacity to reinvent themselves. In my opinion some will very successfully adapt, but many won’t.
Inevitably and regrettably this mean more Heenan Blaikie-style collapses. But the majority of firms will not fail; they will simply compete away their super-profits in the struggle to retain market share.
The NewLaw child is very healthy
Private equity-backed NewLaw entrepreneurs are racing to build many types of legal service delivery platforms. NewLaw is still in its infancy, but RL showed the child is very healthy.
Axiom was an early mover and is the leader of the NewLaw pack, but no one at ReInvent Law was suggesting the demise of BigLaw firms.
The ReInvent conference did, however, agree that NewLaw firms will increasingly take large slices of commoditised work types of all kinds from large and small BigLaw firms. And it doesn’t take much imagination to see the future for most of BigLaw.
Dr George Beaton is a director of Beaton Capital and Beaton Research + Consulting, adviser and consultants to the legal profession.
Twitter: @grbeaton_law. Email: firstname.lastname@example.org.
Dr Beaton’s most recent book NewLaw New Rules is available on Amazon.
NewLaw New Rules – A conversation about the future of the legal services industry