California’s Cooley, Facebook’s lawyers of choice, has its eyes on a London opening. Eventually.
Last week Cooley posted record financial results for the 2013 year, reporting a 9 per cent rise in revenue to its highest-ever total of $674m (3 February 2014).
Average profit per equity partner also rose, getting up above $1.5m for the first time.
Will these robust financials herald a more ambitious period for the California firm, best known over here as Facebook’s lawyers of choice, on the international stage? Cooley CEO Joe Conroy says it might.
“Our ambition is to be elite and global, and you’ll never achieve that unless you’re in London and western Europe,” says Conroy. “Our partners crossed that philosophical rubicon a few years ago but we’re at least as interested in not doing the wrong deal as doing the right deal.”
In other words Cooley is happy to wait, but there are signs that the long-awaited entry into the UK market might just be a touch closer than before.
Conroy admits that the strategic thinking that is likely to eventually see Cooley launch in the UK has been “ratcheted up”. In practice that means that he and his partners or others in the firm are having “more conversations” with groups and firms in the UK, “most of which never see the light of day”.
“The quality of the opportunities is improving,” adds Conroy. “The things that distinguish us are becoming more crystallised in minds of lawyers in London. Seven years ago or so no-one knew who Cooley was in London. We’ve really raised the visibility of the firm.”
Part of the process of raising the firm’s visibility has involved alliances with other firms, notably Olswang, a deal that ended in 2012. At one point these looked as if they might result in a merger but those days are over.
Now Cooley appears to be heading down the path of finding the right individuals to launch in London.
“We are talking about things like maybe 20-30 lawyers,” says Conroy of the firm’s ambition to grow in the UK and elsewhere. “Either groups that are right in the core of what we do and give us strength in our core. Or practices that are high-end, premier, that brings you a different dimension to serve your core client base.”
Last year Cooley made such as hire, bringing in 54 lawyers from Washington DC-based regulatory specialist Dow Lohnes. The deal, which went live on 1 January this year, took Cooley’s total number of lawyers in Washington to around 130.
Cooley’s differentiation as a technology player will believes Conroy, assist it in its ongoing search.
“The shake-out in the US market, by which I mean the bifurcation that’s happening between the tiers that can compete for the highest-value work and the firms that can’t is getting wider every year,” argues Conroy. “Back in 2007/08, people thought this would pass. It’s not going to happen. The bottom 50 firms will perform nowhere near as well as those in the top 50. And the lateral movement that is also happening will continue. What this bifurcation does for you is to make it possible to attract groups of lawyers who may be loose in the saddle at firms that maybe won’t win that battle.”
In short, Conroy believes that as far as firms are concerned, the rich will continue getting richer, and we all know what will happen to the poor. From Cooley’s perspective the focus on what Conroy describes as “an infinitely replicable set of emerging companies”, clients the firm aims to take from garage to IPO, is a core strength.
“It’s a spigot of clients that flows in every year,” adds Conroy. “And the time between when it’s a client in the garage and has become a big company is shortening every year.”
The firm’s ongoing healthy financials are likely to help too. Conroy says the firm is expecting another solid year, with an uptick in revenue post Dow Lohnes looking to be a certainty.
“None of the 2013 numbers include Dow Lohnes so for sure we’ll have a big bump in rev this year,” adds Conroy. “The 2014 budget isn’t set in stone but we’re budgeting for another up year in revenue and profits.”
And just maybe a spot of international expansion too.