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Partner aspirants and digital assets: New worlds to succeed in
There’s a Roman quote about Alexander the Great weeping when he found out he had no new worlds to conquer. It’s a strategic thought provoker for partner aspirants and partners working on expansion – defining the market you want to be successful in the long term and whether that matches your aspirations, writes Liam Hennessy.
Liam Hennessy
First, partners are made in one of three ways: a) an established partner underwrites a special counsel’s or senior associate’s business case, promising a share of revenue until they can command a full practice; b) the firm needs a specialist skill set because of client demand; c) the special counsel or senior associate builds it themselves. There is noise around this process, but ultimately it becomes a case of whether you consider you can execute in one of these three arenas. Partnership is changing itself as our markets and sophisticated legal purchasers change – if you are not values-driven to be empowered to help your clients and the firm, you will falter sooner or later. The other incentives are poor drivers alone.
Third, partnership is based on commercial need and whether your chosen market or sub-market can support a practice of a particular size. If you have figured out the first two steps above, but your market is contracting, it’s a hard business case for management to approve. For example, the market is subject to sharp price competition or is relatively small or subject to legal panels your firm hasn’t won. But you have control over where you direct your energies. Many current partners created their practices, initially, based on a defining shift in the market.
Take the global phenomenon of digital assets. The products, such as tokens, are financialising rapidly, and the infrastructure, for example blockchain, is being adopted rapidly for non-financial purposes, including information storage.
Speaking as a financial services regulatory lawyer, who specialises in this space, it is: a) very broad and large – 10 per cent of the private funds market will be “tokenised”, which means converted to digital crypto tokens by 2030, according to UK Finance; b) new, technical, and highly globalised. The associated risk means there is a significant outlay in terms of years of personal and team upskilling – but that also means it’s a differentiator for those who have truly invested in this space; c) challenging, interesting and meaningful. It is an area where lawyers can make a real difference in helping clients with their knottiest problems.
Commercial litigators who understand how blockchain works, insolvency lawyers who can apply asset tracing laws across blockchain products and jurisdictions, regulatory lawyers who can design compliant tokenised financial products – these are very real opportunities to serve clients. If not, market share will be lost to global competitors who’ve invested in this area given the simultaneous explosion of digital assets work in their jurisdictions; for example, in the US, “learning on the job” will lead to problems for clients and practitioners, and it might be a missed opportunity for many special counsel or senior associates looking to take the next step.
Particularly for those in mid to large firms – the growth strategy of our global practice group relies on cross-practice capability (spanning insurance claims, litigation, and contentious regulatory partners with digital assets experience, for example), servicing clients across offices, and pooling associate teams and thought leadership. Offering to run point in connecting teams, offices or independent firms overseas is always a winner for special counsel and senior associates. It’s good to service the domestic market; servicing the domestic and international market, as the world globalises, is an even better strategy.
Partnership rests on a stable practice of clients who give you their trust. It comes back to that fiduciary relationship. Adopting the rubric of: what’s my path to partnership in this firm? (and what real evidence do I have of that!); why will clients trust me with work over others?; and, does my market or sub-market support a large practice? will hopefully help you create that practice.
For those looking for that inflection point, and knowing that others will be searching for that capability (most large practices have active multi-partner strategies) – it is right in front of you.
Liam Hennessy is a partner at Clyde & Co and an adjunct professor of law at Griffith University.
