Taking shares as fees could pay dividends

In the week in which Dixons' Freeserve became the first big new media

flotation in the UK, having a stake in an IT company appeared to offer the

promise of huge profits to come.

Whether those who are surfing the stockmarket as well as the web will see

those profits in the short term, of course remains to be seen. Freeserve,

after all, has yet to show a profit.

The news that Field Fisher Waterhouse is taking shares in IT companies as

payment for its services may seem a clever move. It enables the firm to

work for start-up IT operations which cannot normally afford top legal

advice, and to be in at the heart of the latest developments in IT and

on-line law.

The IT lawyer who tells The Lawyer that he prefers to be paid by his

clients in good old-fashioned cash has a point, but small IT start-ups

often lack the cash necessary to buy advice in the traditional way.

Of course, Ffw is hoping that the IT companies it has worked for will

become the runaway successes of Silicon Valley legend. If they do, they may

find the profits from their advice far outstrip anything they may have

received by cheque.

But, of course, the gamble is just that.

As the adverts warn, shares can decrease in value. Not every IT company

has been a success. Not every new media idea has made its inventor a

millionaire.

But not every firm is in the position of being offered or able to take

shares as payment, and the relationship that FFW is establishing with its

IT clients mirrors the new flexible economy and relationships that the

electronic economy is setting in motion.

FFW has spotted that firms can have a closer and longer relationship with

clients than just the lead up to the signing of contracts.

They have opened up the possibility for firms to think creatively about

how they are rewarded, who they choose to get involved with and,

ultimately, how they conduct their business.