Should You Lateral? Pt. 1: Capital Markets Associates
Since the explosion in SPAC IPOs (special purpose acquisition companies) in the last year or two, the need for experienced capital markets associates at BigLaw firms has been constant. Law firms cannot find enough associates who have experience advising companies and their financiers on how to raise capital from the public markets. This is especially true in the big transactional law markets like New York, Boston and the Bay Area as well as Texas and Chicago. At the same time, because of this talent shortage, it is not uncommon for BigLaw associates currently working in a busy capital markets practice to be on track for billing 2,500 hours or more this year (same as last year, and possibly for years before).
So if you're a capital markets BigLaw associate and you think about lateralling to another firm, how do you know it will be worth the move?
Here are some reasons to consider lateralling as a capital markets associate:
To move to a firm with a cap markets practice that has more attorney support. BigLaw firms are not equal when it comes to the number of associates working in certain practice groups, as well as the partner-to-associate ratio. When it comes to capital markets groups in particular, maybe the firm keeps the group lean and only staffed by attorneys with cap markets-specific experience. Other firms, will more easily allow for cross-staffing when cap markets deal flow is especially high, whether through adjacent corporate practice groups or other offices. Additionally, the number of attorneys working on the cap markets team is important. How many are there? Are there enough associates at the different experience levels? Are there partner and counsel who take an active role in helping to run the deals? If the support is not right at your current firm and you are consistently billing extraordinarily high hours, it may be time for a move.
To create better prospects for partnership. BigLaw firms are also not equal in their paths for partnership. Capital markets is one of the most profitable practices in any major law firm. The fees collected from a SPAC IPO or a major debt offering can be a big part of an entire firm's revenue and profits per partner. If you're an associate developing strong expertise in a profitable practice like cap markets, you want to make sure a path to partnership is viable. For some firms, this path is very clear with important landmarks and dates laid out clearly; for others, not as much - you may look at your current firm's recent partner classes and feel like you don't have transparency on how elevated cap markets partners got to where they are.
To create a stronger or different platform for going in-house. Of course, making partner is not for everybody. Like other corporate associates, you may be looking down the line to make an eventual in-house move. However, cap markets experience is not as easily transferrable to in-house jobs as you might think. If you're in New York City, the financial industry in-house possibilities are strong and if you're in the Bay Area, there are lots of companies in "growth mode" that could use the counsel of an experienced cap markets attorney. However, if you're in New York practicing cap markets and want to make a move to a large tech company, for example, your experience advising financial industry clients can sometimes be a hurdle. By lateralling to a firm that does more "company side" work in their cap markets practice, you can open up your in-house opportunities for later on.
To obtain more flexibility for working from home or remotely. The return to work policies for law firms continue to be in a state of flux. In addition, as timeframes start to settle in the new year for coming back to the office, a firm's openness to remote work for its associates will probably continue to depend on the office, the practice, the working group and the individual associate theirself. Because of the high demand for capital markets associates at this moment, now is a good time to consider opportunities at firms that will be on the more flexible end with regard to your working arrangement.
To relocate (even if your firm has an office in your new destination). A common reason to make a lateral move is to relocate. Even if your firm has an office in your new destination, will that office be right for your capital markets practice? Maybe the firm will allow you to relocate even if there are no cap markets attorneys in the new office, but maybe you would rather work with your team in person and on the ground. That means that you should make a lateral move. In Boston, for example, a lot of the capital markets practices are integrated into larger corporate M&A and private equity deal practices. If you're coming from New York, it may make sense to move to one of these firms that are on the ground in Boston which better reflect the nature of corporate work in that market.