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Many of you know we interview corporate defense law firm leaders
Partners General Counsel's and legal consultants you are listening to episode number 11 of the law firm leadership podcast
Broadcasting from Kansas City, this is the law firm leadership
Podcast in each episode you'll receive actionable ideas and hear personal leadership
stories of the top corporate defense law firms from around the United States
Enjoy a front-row seat with law firm leaders their partners and legal consultants as we discuss life and the leadership
Welcome to the law firm leadership podcast. I'm your host Chris Batz with the line group today
I have the pleasure of speaking with Elliott Portnoy global CEO of Dentons
Which is the largest law firm in the world as global CEO Elliot is responsible for management of the firm which includes over?
8,000 lawyers and numerous support staff in 66 countries and 153 locations
Elliot was key to the formation of Denton's during March 2013
from the combination of SNR Denton Canada's Fraser milliner Cass green and Europe's
Alan's and since then have been in the middle of several other combinations and growth which we'll get to
Prior to Newtons Elliot you took the helm and was the youngest chairman of the Sun and shine Nath Rosenthal at 41 years old
Since the firm's founding at 1906 in during September 2010
Elliot helped lead the merger of Sun and shine with UK's Denton wild SAP to create SNR Denton, Elliott
You received your JD from Harvard a PhD from Oxford being a Rhodes Scholar and your undergrad from Syracuse?
You're active in community service particularly on boards of nonprofits and with keen welcome Eliot's at a law firm leadership podcast
It's a pleasure to have you on the show. Thanks very much Chris very happy to join you, so let's just jump right in I've
Really enjoyed. I don't know many people have just been watching the
astronomic growth that's happened with in Denton's and the progression of all the different combinations took place and
Knowing that you were 41 when you took over as the youngest chairman at Sun and shine I'd love to just touch on some
immediate advice
Knowing what you know now?
What advice would you give yourself?
If you were to take on and start kind of start that whole process over again with Sun and shine at 40 one
Interesting question and one that I actually think about a lot is I feel very lucky that over these last
ten years
I've been able to do something that many law firm leaders. Don't get to do
Which is to be part of the?
Transformation and really remaking of not just one firm, but but multiple firms
And it started with Sun and shine a firm with a rich history and wonderful people and tremendous values
But we've been able to continue to remake the firm
but when I look back on the first set of combinations and really the starting point for our growth I
Remember then some commitments that I made to myself that I still feel like I am maintaining
Around the importance of staying very focused on family I have three young kids and actually not so young anymore
but
three kids has to be very intensely focused on the community and
Perhaps most importantly to ensure that I could build a team that
had the same passion for
What we were doing
because it's the sort of endeavor that one can't do singularly, but it really has to be part of a
Yeah, so it sounds like you wouldn't necessarily give yourself much advice or indifferent bytes
You just really have stuck to your values for 10 years. Well. The world is dramatically different
Today for law firms than it was 10 years ago
But we had the good fortune some might say vision, but for these purposes
We'll just say that the good fortune to look over the horizon and see a set of trends developing in the marketplace
To have a set of conversations with our clients and to be a step ahead of
What was happening in the profession and the result is that 10 years ago?
I feel like we embarked on
Exactly the right course to be able to create a a better stronger future
Not just for all of my partners, but frankly for the next generation of people who call Denton's home
Just asking the probably the not so simple question
Why did the firm become the largest firm in the world?
Was this something you just woke up and realized this is what needs to happen now
We didn't set out to become the world's largest law firm in
2010 when we did the first
significant combination
Which was the combination between Sun and shine and Denton while shaft we did so because we realized that our
firm full of some really outstanding
lawyers was largely indistinguishable
from about 3 dozen other law firms in the US legal market and our
Combination target Denton wild SAP felt the same way about their position in their market
And we wanted to create a very different kind of law firm, but principally a firm that could more effectively
compete for clients and talent
Than others in the marketplace
So that was the first step at that time we did not plan
Nor could we have imagined that we would become the world's largest law firm
We were simply ensuring that we were taking the action steps to be responsive to our clients and a set of industry trends
The success of that first combination led to others and over time we became
The world's largest law firm, but it was never our objective or our goal
We intend to be the world's leading law firm
Not the world's largest law firm, so I had a conversation with a legal consultant last year
And he had mentioned the combinations that Denton's have undergone and has noted other large
global law firms eyeing this
Would you say Elliott that there's a race to ten thousand lawyers? Oh?
I I don't think so to the extent. It is a race. We'll win
But we're not in it to get to a particular number there really is no magic number
It's about ensuring you can meet the needs of your clients in all of the
geographies the practice areas and industries that matter
And what we've learned over the course of the last several years of pretty material growth
But is that
There is no limit. There's no magic number and rather that we need to just be
slavish in our response to what our clients need and our
Clients have indicated that they want a very different kind of law firm a firm that has a different strategy a different philosophy
a different approach, but in particular
They want lawyers
Who are in and of the community and all of the markets that matter to them around the world and?
Today even as the world's largest law firm
There are a number of markets where we either don't have a presence or we don't have a strong enough presence
And we intend to continue growing
So let's just do a little review for listeners to hear all that you and your team have been up to
So you mentioned that the September 2010?
merger that formed SNR Denton
With the US firm sunshine in the UK firm denton wild and the next one that you guys have done was march
2013 which created Denton's, and it was three firms
Nerd Denton Canada's Fraser Milner, and then Europe's, Alan's and then after that it looked like January 2015
Which I think was kind of the one for the word of shock?
But it really sent shockwaves was the combination with China's largest law firm
And it's is it da Chang is that how you say it that that Chong that touch on wreck okay?
And then I know there was still ongoing conversations with McKenney long, Aldridge, and that was wrapped up in June 2015
And then you had a combination with a Singapore firm in
2016 April and then also in May
2016 you combined with a Columbia firm and a Mexico firm and for sake of not butchering their names
I won't say their names, but all that information will be in the podcast what an incredible ride. I have to ask Elliott
What were some of your takeaways?
Through all of that combination activity well I would first note that
What while trying not to?
be anything other than humble in that same period we also
grew in Italy in
Luxembourg and Hungary and South Africa and since then in Brazil and Amsterdam and Peru and Scotland
We're very fortunate that
We've got an extraordinary team
Combinations like this are actually pretty rare in the legal profession
And while Denton's has done more than any law firm has ever done the reality is that about
98 or 99 of hundred conversations never actually lead to fruition these are complicated
transactions you need to find a high level of strategic and cultural and economic fit so most of the
Conversations we have actually don't lead to a deal
but we're very fortunate that the
Combinations you've identified
The large ones and some of the the more modest in size
All had similar features which was a high level of strategic alignment
and
Were infused by our clients identifying a market
Practice a sector that they believed were critically important to them
but perhaps most importantly
all of the
Combinations have been very good to our fundamental
Economics in every part of the firm this growth has led to our ability to serve clients. We couldn't serve previously
To retain clients that we may have been in jeopardy of losing
And to attract and retain talent
That we might not have been able to attract and retain but for the growth so for us
It's really been not just an extraordinary
Journey, but it's been the fulfillment of our clients desires
And it's allowed us in a period of exceptional competition and turbulence to create a far brighter economic
Future for all of our people Eliot, I can't help but wonder if most conversations never come to fruition
What kind of deal team are you using? Are you working with it internally or externally to manage those numerous conversations?
How do you guys handle the volume well it's an internal deal team it is a dynamic
exceptionally diverse and talented team
Based in a number of markets around the world
And that team really deserves all the credit for what we've been able to accomplish
while my colleague Joe, Andrew and I
Often get the credit the real praise goes to our team our team of
Of what we call our global Chiefs?
Individuals who are responsible for some of our key functions?
our core deal teams and our regional CEOs
Who work very closely with us to be able to advance these opportunities?
And having done as many transactions as we've done. We've gotten pretty good at it, and we're able to make
early decisions about when we think the
cultural or strategic fit may not be be present and
Withdraw from a conversation, but importantly what maybe we're most proud of Chris
Isn't the number of deals or even the results but that they don't leak?
We keep them very private. There are literally
Hundreds of law firms over the last
Five years with whom we've had conversations around the world and in some instances those
Conversations have been quite advanced even gotten nearly to the point of a vote
Where we or they have decided or maybe mutually decided not to proceed and there's not been a leak
That's critical. We need to be able to maintain
With complete confidence and discretion these opportunities and unlike so many
transactions that fail
Because word gets out to the media
Our deals don't and that's made of really material difference to our ability to be able to advance
Those combinations, which we've approved to closure yeah, that's huge. Yeah, it's definitely commendable because
In today's age that tends to happen quite a bit. Well. There are a number of firms
I'm sure you know them that are on their seventh or eighth
publicly reported merger conversation and the sad truth
For some of those firms is that they may never be able to complete a deal because the market simply won't have confidence
Firms won't have confidence having a conversation with the leadership team
Because they don't believe it can be done
Confidentially and with real discretion if that's vitally important to actually getting a deal done
when it involves lawyers yeah, yeah
I get that you mentioned Joe Andrews
I'd love for you to just tell me tell us a little bit about your relationship and friendship with Joe over the years
Sure, Joe, and I were were friends before we became partners
I was able to successfully recruit Joe to join me at the old southern shine firm
And he and I as friends and colleagues in leadership
That developed the approach the strategy and then executed on it
over these last seven years since the combination with
southern China and Denton while sacked
It's unusual because most law firms
Have a singular leader and that leader very often has to look over his or her
shoulder and
worry about
Who might be and moving up behind them or in front of them
And it's often very difficult in the law firm context to be able to build a team
and be able to execute on an aggressive strategy as a
single person and Joe and I formed a team we like to talk about it as the power of two and
We are able to together
Advance the opportunities it used to be we do everything together. It's a little harder these days with
66 countries to cover so we divide and conquer perhaps a little more than we otherwise used to but having two people
with complementary skills who come at issues and problems a little differently
frankly allows us to make better decisions and we are a
Unified team which is very different than most law firms that just have a one person
typically
One chairman or one CEO, and that's it. We've done
It differently and we think actually it's the best practice and one that really has helped us achieve our objectives
That's excellent. That's tremendous
Elliot let me have you step into the?
the shoes of others if you were a managing partner of a
Firm say a thousand or less even down to a hundred attorneys what advice would you give a managing partner?
Exploring a merge or a combination looks like your top two or three
anecdote advice for them I
Think if the firm is already considering a merger combination
Then perhaps the most important advice has already been followed
I think for those firms that
Are not looking at opportunities to grow and follow their clients in the markets that may matter to them they may be at a disadvantage
But for those managing partners who are already doing so I think the most important?
Priorities would be first to find a firm that you can have discussions with who will treat
Everything as entirely confidential so there can be no leaks nothing can be more damaging as we talked about then those
premature leaks to the media that
really can tear apart a partnership
the second would be to look for a a
Potential combination or merger partner that's got some experience getting deals done as noted earlier in our conversation
These are complicated deals
partnerships are not the same as
corporate
M&A
transactions and so
Having a combination partner who knows?
how to integrate how to get a deal done how to get the necessary votes
Can be really important then the third thing. I think would be not to double down on your existing challenges
We see a lot of merger activity a lot of combinations between firms
that seem to have the same attributes and the same challenges and that's
Perhaps a short-term way to avoid the challenge, but in the long term
We think or I think what's probably most effective is to find a firm that brings you something you do not already have
whether it's geographic reach particular talent or
Different industry expertise, but doubling down on your existing
Complement of attributes usually is not the strategy for long-term success
That's great advice and I appreciate your sharing that Elliot
Let's shift to your competition now when you're the biggest out there
You may discover you of competitors you didn't realize that were there
I'd love to just ask you in this competitive environment now with a firm like yours
who are your competitors well in truth our competitors are both law firms and
Non law firms so in the the law firm world. We've got a set of global law firm competitors
Those larger firms that are able to offer
integrated client service across multiple countries and geographies
That's always been part of our competition
We also compete with the elite law firms some of them smaller firms in every marketplace
But often what we're competing against will be
legal networks, which are themselves
Not integrated. It's multiple firms coming together under the banner of a network to try to vie for work
but increasingly
In markets outside the US our competition is the big four where as you probably know?
There are no restrictions on the ability of the big four to practice law in most jurisdictions
around the world so will compete for
litigation or M&A work from PwC or
KPMG Reny in a number of geographies and
in the last few years
We found even more
competition from technology companies
Companies that are increasingly bringing artificial intelligence and other
innovation to the practice of law
Such that the competitive marketplace
Looks a whole lot different today certainly than it did in
2010 when Sun and shine and Denton wild SAP first came together to create us and our identity yeah
Yeah, yeah, thank you for that
I had a feeling that there would be more than simply law firms out there to hear the the public accounting firms competing
And then the technology firms Elliot, so you kind of gave us a high-level perspective on competition?
Let's go a little higher and let's talk about the entire legal industry as a whole
So 50,000 feet what changes do you see coming to the legal industry?
Give us like a five to twenty year Spann. What should we be expecting?
First I think I know one of the the hallmarks of the the legal profession in industry is that there can be?
different firms in the same marketplace
whether in Washington DC where I'm sitting today or Kansas City or
London or Toronto
Following very different strategies, and they all will have some measure of success the the particular strategy
We've employed has been very successful for us
But we don't suggest it's that the right one for everyone, but it's against the backdrop of the set of trends in the industry
that are inexorable and
moving faster and faster
There is in the profession not just in the US, but around the world
stagnant demand
And if it's not stagnant that it's declining client simply don't need lawyers the way they used to
clients are
Not as loyal to a law firm as perhaps. They used to be
They're using formal procurement processes panel reviews and the like which results in
clients consolidating and using fewer law firms than they ever have
legal project management is
very much a
That will reshape the way business is done
All at the same time you've got these new law firm
Competitors that I mentioned earlier like the big four
cloud-based law firms
You've got artificial intelligence. That is reshaping
The profession such that their estimates that as much as thirty three or even a higher
percentage of work done by
associates today
Won't be done by associates in ten years what we've done by machines or computers
And when you put all of those pieces together?
at the same time
It's a serious threat to the way in which many law firms futures
may May
unkind of
Unveil themselves such that for us the action steps, we've taken
Position us for growth and success going forward, but those law firms that are standing still
That are hoping that the market will return to the way it once was I think are going to be in a very
Shaky shape and may well not make it
Because all of those trends are moving faster and faster
And those are just the trends. We know about as is always the case. There'll be some unexpected twists and turns
But the result is that a law firm that isn't innovating that is an agile
That isn't following its clients to where the clients need it to be will be in real danger
Yeah, thank you for that. I know there's been a
Lots of changes in consolidation coming to the legal industry let me flip it
Let me invert it. I want to invoke Charlie Munger and this question and to quote Jeff Bezos
What's not going to change in the next 10 years 10 20 years for legal industry?
well I
believe that the
the fundamental
quality and
reliance on lawyers
For a particular set of services won't change 10 years from now 20 years from now
That that focus on quality will remain unchanged there will still be a set of elite law firms in every
marketplace that will continue to be successful so that whether it's the
New York elite firms or the magic circle in the UK or the
Proverbial Seven Sisters firms in Canada those firms will still be in existence
They will still be successful
That will be I think a feature of the marketplace will still be
small all
boutique firms and jurisdictions all around the world and there will still be
Large global players like Denton's that continue to have the ability to handle that
high-value complex work that requires a multi-jurisdictional
Focus it's everything in between those that I think is very much at risk and in jeopardy
In this evolving landscape yeah, Thank You Elliot, let's pivot to another thing Denton's has launched in May 2015
Next law labs, and is that in legal tech accelerator business accelerator
It is we were the first law firm to build and develop our own
Accelerator we would refer to it as a collaboration platform it is
Wholly owned by Denton's and we do a number of things with next law labs
first and most importantly
We collaborate with our clients so our lawyers and our clients collaborate to develop our own technology
Solutions to problems that clients have in various industry and practice areas
That's the most important thing we do trying to bring innovation to help solve clients problems
But we also
make
investments in
various technology companies as you know there's been a
Explosion in the legal tech sector, and there are a number of solutions out there that rather than building it ourselves
We've invested in some of the leading companies
They're about a dozen companies last year that we made investments in which give us
Preferential access to the technology the software so that we can then test it and use it
with our
Clients and increasingly clients want a law firm that is innovative that can actually
Not just do what has always been done whether in litigation or in?
Transactional or regulatory work and next law Labs gives us the ability to bring something new and different
to our ongoing client relationships, you know that's truly exciting and I
Continue to see some firms
Fearful and steer away from the technology that's changing the industry and some of them. I say embracing them, and I think it's
Seems to be very important to me embracing it well our clients are very
focused on innovation
Our clients partner with us with neck salon labs, and that's what makes it a great success
We're able to use this collaboration platform to add real value to clients clients
It's often said clients want everything better faster cheaper
That's not necessarily the case they do want better service
They'd like to have greater value, but they're really looking for a law firm that wants to partner with them
Invest in them and bring best practices and innovation to the relationship and next law labs allows us to do just that
Yeah, that's very exciting. Let me ask you this question Elliot
What's life like being a global CEO of the largest law firm in the world I?
Am I'm very fortunate. I have what I believe is one of the best jobs
available in the legal profession the legal
Sector I'm able to help put together
A new firm a firm that doesn't always follow all the traditional rules
That pushes the boundaries
That really tries to be a little bit of a challenger brand
And to do so in collaboration with Korean, so I'm I'm very lucky
The travel is extensive as you might imagine
With a hundred and fifty three offices in 66 countries. I'm on the road virtually all the time
and that can certainly be
Draining at times, but it also is exhilarating when were able to
meet client needs in ways in places
We never could we're able to attract fabulous talent that might never have considered joining
The old sunshine or the old pressure millner cast grain or dentin wild SAP and that
That makes the long plane flight
pale
In comparison to the outside, it's the most interesting place. You've been to thus far
It would be difficult to point to a single
Place I've got
some favourites of
Places that I spend a lot of time all around the world
but I'm lucky I can in a in a week be in San Paulo and
Edinboro
And then head off to Sydney and end up in that Almaty Kazakhstan
And each of the the markets culturally is very very different
but what's
What I'm very lucky to experience is that in each of those markets
Were often either the only global law firm in the marketplace or sometimes the oldest and most
Rooted so I get the opportunity to see a place like
Singapore where we are literally the oldest law firm in Singapore through the eyes of a group of colleagues who have been there for generations
Who are deeply rooted the founders of our?
Firm in Singapore have street named after them and that's a very very different experience
In a place like Singapore in China where we have over 40 offices
Or in Canada where we have six offices or here in the US where we have nearly two dozen
Each markets a little bit different, but in all of them
We've got really exceptional lawyers and professionals
And I get the pleasure of traveling to meet with clients and meet with colleagues and try to help knit everything together
So I know that community service has been an important value for you
Talk to me about keen why keen why bring it from Oxford England to the u.s.
Cane is very important to me. It's a sports program for children with disabilities that I founded at Oxford
When I couldn't find a program like it here in the US
We built it here in the Greater, Washington area
But it's actually less about me, and maybe he says more about about my firm in that in
2006 when Sun and shine was preparing to celebrate its centennial
Rather than spending a lot of money on a movie or a coffee table book the firm
Came to me and gave me the seed funding to be able to establish
keen affiliates in New York in Chicago and Los Angeles and st
Louis and a number of markets around the the US and
Denton's continues to be one of the most active and generous supporters of Keene
because while I happen to
Place a really high premium on community service and community engagement
Denton's does as well
and that's been a wonderful ability to Mary my interest in community service with what I do for my day job and
Denton's has a long and rich history of pro bono and community service engagement
And Keene is just one example of how the firm really
Invests in the communities in which its lawyers live and work, that's excellent we talked earlier
And you had mentioned that you can n I can understand you may not have a lot of time to read
But here's another inversion question. I like to ask what books should be written Eliot that aren't written yet. Do you have any?
Book titles that you think should be written well of course
I hope someone will will write about the wonderful journey that that we've had in Denton's and the ability to
knit together these extraordinary law firms I
Can't say that that I can identify a
Book that needs to be written candidly in my case. I need to find more time to be able to to read I
just had a little bit of time off and
Was able to begin to make a dent
In the pile of books that not only is on my bedside table, but fills up the drawers
of that table
But it just made my way through hillbilly ology, which has had been at the top of the list that
Books that I wanted to read in part because I grew up in West Virginia
But in part because I had heard so much critical acclaim all of which I think was warranted. It was a
wonderful read particularly at a time people in the US are
Wondering why certain voting patterns developed the way they did in this most recent election
I know our time is kind of coming to a close so
Let me ask you this question being that it's our last question. What's the kindest thing anyone has ever done from you Elliott?
I
Think maybe the most important, and I suppose it was was kind of certainly felt that way to me
Was the decision of the road scholarship selection committee to give me the opportunity to spend three years
studying and doing my PhD at Oxford
For me it
firmly
established
My outlook as a globalist as someone who believes that we are better when we are inclusive
when we don't have borders and for me it was very much a life-changing opportunity it happens to be also where I
Had the opportunity to establish Keene so so many of my current passions and interests
Come together and but for the kindness of that group that
saw fit to give me the opportunity to have a scholarship to study at Oxford I
Might be on a very different path right now Chris
It's certainly an honor and it's tremendous that you were you're given that opportunity
And I can see where that would be such a kind of thing well Elliot. It's been a pleasure. Thank you for your time. I
Was thrilled to know that you would be willing to do this
I know you have an extremely busy schedule and just appreciate all the story you were able to share with us
And it's exciting to watch what Denton's is doing well
I enjoyed it Chris and hope to continue the conversation and the coming months
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