Technology firms: RPP reveals all

On the surface, Bird & Bird and FFW seem to be shooting ahead of the pack, with TwoBirds having added 23.7 per cent to turnover this year, FFW 30 per cent.

With the results in from around 40 firms now, it’s becoming possible to compare firms in their peer groups.

For example, you can take the five largest firms with a significant focus on the technology industry: Bird & Bird, Field Fisher Waterhouse (FFW), Olswang, Osborne Clarke and Taylor Wessing.

Top of the PEPs Revenue PEP Table

On the surface, Bird & Bird and FFW seem to be shooting ahead of the pack, with TwoBirds having added 23.7 per cent to turnover this year, FFW 30 per cent.

Further, FFW, the only one to have figured out its profits yet, has also seen its average profit per equity (PEP) shoot up 27.5 per cent to £750k.

Olswang and Taylor Wessing, by contrast, were both up about 11 per cent on turnover, while OC was up 15.

But a little peek behind the figures reveals a need to compare like with like.

FFW set itself off on a three-year plan in November 2004 aimed at boosting revenue to £75m.

In that first year, profit was boosted by a 19 per cent from £325,000 to £390,000, prompting one partner to boast (hilariously, in retrospect): “This is genuine growth and isn’t a result of shrinking the equity.”

And at the time, that was true. Since then, however, the proportion of equity partners has sunk from 51 per cent to just 30.

In fact the firm has four fewer equity partners than it did back in 2005, but some 44 more partners in total. So the growth’s not so genuine now.

Similarly, Bird & Bird’s equity/non-equity proportion has also shifted, from 42 per cent in 2005 to around a third today.

At Olswang, Osborne Clarke and Taylor Wessing in the same period, however, the ratio has hovered around the 50/50 mark consistently.

So in the eternal search for a leveller, and given the lack of a profit figure for most of them so far, here’s the same firms ranked by revenue per partner:

1. Olswang £1.09m (up 1 per cent on last year)

2. Bird & Bird £905,000 (up 8.8 per cent)

3. Osborne Clarke £826,000 (up 3.8 per cent)

4. FFW £721,000 (down 4 per cent)

5. Taylor Wessing £642,000 (zero change)

Which paints a slightly different picture…

What was that phrase about damn lies and statistics?

Previous blogs:

27-June-2008, Walker Morris: Turn down the volume

27-June-2008, Hill Dickinson: A tale of two cities

20-June-2008, LG: “frustrating and disappointing”

13-June-2008, Trowers & Hamlins: set back, or de-railed?

12-June-2008, Stephenson Hardwood: joining the club

11-June-2008, Ward Hadaway, Leeds and Hoyle: the long game

10-June-2008, Lewis Silkin: credit where due?

09-June-2008, Freshfields: equity cull pays off

06-June-2008, Martineau Johnson: mission accomplished?

05-June-2008, Addleshaw Goddard: babies and bathwater

04-June-2008, Technology firms: RPP reveals all

02-June-2008, The magic circle – a new ring leader to emerge?

30-May-2008, Berwin Leighton Paisner: could do better

29-May-2008, Links to take CC’s crown?

28-May-2008, FFW: surprise performer

22-May-2008, Herbert Smith lays down the gauntlet

19-May-2008, Second tier is out to impress