West Coast technology firm Venture Law Group (VLG) has been forced to close its San Francisco office just as it received a $3m (£1.9m) windfall from one of its early stage investments
VLG director Donald Keller confirmed that the firm closed the office - which had enough room for 40 lawyers but only housed 12 - four weeks ago, after deciding it no longer needed the excess space. All 12 lawyers have relocated to the firm's Menlo Park branch. VLG signed a 10-year lease on the office in 2000, just as the dotcom boom was beginning to wane. Keller declined to discuss the cost of buying the firm out of the 10-year lease. However, because the commercial real estate market in northern San Francisco, where the office was based, has not been hit as badly as the Southern Bay area, it may have been easier to strike a deal with the landlord. The Southern Bay area has an estimated 50 per cent of its commercial space vacant after the decline in the area's technology-focused businesses. The decision to close the branch coincides with a substantial payout from internet payment group PayPal, which was recently purchased by online auction company eBay. VLG, which sports the motto 'From tiny acorns, mighty oaks grow', initially invested $25,000 (£16,000) in common stock in PayPal, but hit the $3m jackpot when the company floated in February. But, as is common with most flotations, VLG was subject to a six-month lock-in after the initial public offering to prevent the share price cratering, with shareholders looking to offload their investments quickly. As a West Coast firm, VLG has been hit by the worst of the economic slowdown and in response has cut back on staff numbers. Late last year the firm also slashed its associate salaries by 30 per cent. More recently, the firm lost partners Craig Sherman and Mark Handfelt to Wilson Sonsini Goodrich & Rosati.