A virtual firm launched yesterday which hopes to attract 50 corporate and commercial lawyers billing a total of £15m a year by 2019.
Carbon Law Partners, whose chief executive is former City solicitor Michael Burne, aspires to the success of virtual law firms such as Keystone Law and Setfords.
Mr Burne said Carbon was “for ambitious, client-focused lawyers who want choice, control and freedom. It is for those who want the flexibility of running their own firm, but with the back-up and support of systems used by a top-50 firm wherever they are based”.
Mr Burne has worked variously as a solicitor at Allen & Overy, head of legal at wealth manager St James’s Place Capital plc, and as MD of Cardiff-based commercial law firm Paritas. He founded Carbon with banker Owain Saunders-Jones, who has held senior roles at Barclays and Lloyds.
With its public launch, the firm has now embarked on actively seeking out partners. Speaking to Legal Futures, Mr Burne said he had spoken to some 20 lawyers in target firms during 2013 as part of research for the project. There was already a “pipeline” of lawyers “at different stages of the decision-making process” who had expressed interest in joining.
He added that in terms of recruiting members, “lawyers don’t make snap decisions and frankly if they did, we probably wouldn’t want them”. He conceded it was likely some lawyers might wait until others ‘jumped’ first, but predicted that if Carbon could “achieve traction in the first six to 12 months”, it would create “a natural momentum”.
He said a key message Carbon needed to convey was “that in many ways we are the safe place to be”. Elaborating, he said: “We need to create a tribe of lawyers who think like we think; people who want to invest in themselves, and maybe want to create a firm that they control but without the risk of starting their own law firm, without any of the exit problems or successor insurance problems when they want to stop.”
Lawyers the firm was targeting included both younger “aspirers” to partnership and older “retirers” who wanted to escape traditional partnership both with their capital account intact and the risk of having “a joint and several liability call”. By choosing Carbon, they would “do the lifestyle thing and come and retire into one of our limited companies”, he said. They would also benefit from “a capital value in the client relationships” they had built up over decades.
Mr Burne said Carbon was “a law firm and a legal services platform” that created “the conditions that we think lawyers need to operate in”, backed by “state-of-the-art technology”. When they joined, lawyers would “be inside their own limited companies, so insulated from the negative side of joint and several liability, with no requirement to make a capital account contribution to our business”.
Carbon would provide, procured by contract with the individual limited companies, the “essentials that allow you to practice as a solicitor”, such as insurance, as well as voluntary “concierge” services, such as back office functions. As a “single entity law firm”, Carbon takes “all of the risk of the advice given by partners, who are named in the insurance policy”, he said. From a regulatory point of view, “the regulator is regulating Carbon and Carbon is responsible for the behaviour, conduct and advice of all of the lawyers within it”.
Carbon would take a percentage of lawyers’ earnings on a sliding scale. Those billing over £200,000 would receive “a minimum of 70% of what they bill” and the higher the billing, the smaller the percentage taken by the firm.
A Carbon “bond” would be a performance-related percentage of the firm’s profits, allocated according to a “quality multiplier” calculated according to “how compliant they are and how much they add to overall brand value”, Mr Burne said.