I’m a partner at a national firm, but have just been offered a great opportunity to move to a US firm and build a practice from scratch. The only problem is that it will mean the pressure is all on me to succeed.
What should I do to keep my existing client base happy and move with a following, without getting into difficulties with restrictive covenants? And what is the best way of building a new practice?
You must ascertain if you really do have a following. Ask a few key and trusted clients how they would feel if you moved on and test your choice of destination with them. Assuming they are positive about the change (if not, reconsider your options), you will have brought them into your confidence and they are even more likely to support you when you move.
If you have signed a contract/partnership agreement that includes restrictive covenants, they are binding apart from in unusual circumstances. You can only extricate yourself via negotiation. You will have a chance of success if you can bring commercial pressure on your current firm. Try to marshal your clients to indicate to your current firm that it has a greater chance of continuing to be instructed by them if they release you from your covenants.
Nick Woolf is a partner at Sainty Hird & Partners
In relation to your existing client base, you need to understand fully the types of covenants you have. It may be that you are prohibited from approaching clients for a certain period of time and you will need to adhere to this.
Of course, depending on the wording of the covenants and assuming you do have a personal relationship, it may be that they can approach you with instructions.
Building a new practice is likely to be challenging but an established US firm may have a bigger profile than your current firm and you can use this to help win new pitches and raise your own profile. Furthermore, it is likely that, if your practice area is one that the firm wants to develop, it may already have existing clients to advise and again this will help you build the new practice.
Alberto Giovino is a consultant at Shilton Sharpe Quarry
You’re right, the pressure will be on you as your new firm will, not unreasonably, expect you to bring in new clients and to bill those clients by a decent multiple of what you’re earning.
If you have restrictive covenants, they will be enforceable but if you leave your current place amicably and the new firm is a very different proposition, you may be able to negotiate a deal on the clients that everyone agrees are ‘yours’.
The key to assuring that your clients will instruct you in your new place is to make sure your value proposition is identical or better to the one you are leaving, so your business plan should include your growth plan for the team as well as all the financials. Your business plan will be key in assisting you to build a new practice, so spend a good amount of time on it and get the help of an experienced recruiter to do it.
Mark Brandon is a partner at recruitment consultancy First Counsel