[1]Holdsworth: BGF leave us to run the firm
A law firm specialising only in contentious probate has secured £3.25m in private equity funding to boost expansion across the country.
IDR Law is the fifth law firm to receive backing from BGF over the past eight years.
Martin Holdsworth, founder and chief executive of IDR Law, told Legal Futures that he received three offers from private equity houses before choosing BGF, which takes only minority stakes in businesses and does not impose management changes on firms.
IDR Law is based in Harrogate, Yorkshire, with offices in Bristol and Manchester. Mr Holdsworth said his aim over the next year was to open at least one more office, in London or Birmingham, and increase the number of staff from 22 to about 30.
The opening of an office in the North-East was also being considered. “Where we choose will depend on where we find the talent.”
Mr Holdsworth said referrals from other law firms would continue to drive IDR Law’s growth.
Much of this came from the IDR Network, launched in February last year [2], which provides almost 700 subscriber lawyers and firms with an online referral and support service for contentious probate, extensive training and other resources.
“I recognise that each firm might refer to us only one or two cases a month, but if you’ve got hundreds of them doing it, then you’re going to be very busy. Our net is very wide. We’re getting calls from everywhere at the moment.”
The solicitor explained that he had approached a number of banks for loans, but they were “incredibly inflexible” in their approach and “not interested in a business with a turnover of less than £10m”.
Raising funds internally from staff was “not an option”, given the value of the business and the amount it needed to raise.
One of the other private equity offers was to purchase the firm and issue shares to him and other members of staff. The third asked for a higher percentage of shares than BGF as a minority stake.
“The BGF offer was best for the law firm and left us to run it with their support,” he said.
Mr Holdsworth said the amount of contentious probate work was increasing all the time, as more and more people depended on inheritances to fund their retirement.
However, the market for probate services was “very fractured”, with the exception of Co-operative Legal Services, and made more complicated by the presence of unregulated firms.
Mr Holdsworth said that, although the process was separate from the BGF, the law firm had been helped by the BGF’s talent division in selecting a new, non-executive chair, solicitor Charles Layfield, former director and head of legal at Minster Law and partner at Pannone.
Chris Boyes, who led the deal for BGF with Linda Nguyenova, commented: “Martin has taken an entrepreneurial and innovative approach to a traditional industry and have experienced excellent growth to date, while creating a great place to work.
“With fresh investment and BGF’s experience of adding value to businesses as they scale, IDR Law is perfectly placed to accelerate its expansion.”
In 2019, BGF made a “multi-million pound” investment [3] in Equilaw – which says it is the UK’s only law firm dedicated to equity release work – and residential conveyancer Thomas Legal. They are sister businesses with common owners.
BGF exited fee-share firm Setfords [4] in 2021, saying it had generated a “high return on capital” after injecting £3.75m into the firm [5] in late 2016.
Its first deal was less successful, with multi-office high street law firm McMillan Williams – in which it invested £7.7m from February 2015 – ending up being sold out of administration [6] in 2020 to Taylor-Rose.