Understand Your Rights. Solve Your Legal Problems
The legal industry is competitive in many ways including recruiting top talent. Law firms have to compete with each other on a range of factors to ensure the best come to them. Differences in salary between the top firms differ very little if at all, however, it has changed over the years to keep up with the market as in 2022 for the first year the salary was 205,000. In 2023 this has jumped up to 215,00 for a first-year salary.
The Top Paying Law Firms of 2023. Here are five of the top law firms and the salary they offer.
| Law firm | First year salary | Second year salary |
| Akin Gump | $215000 | $225000 |
| Latham & Watkins | $215000 | $225000 |
| Kirkland and Ellis | $215000 | $225000 |
| Herbert Smith Freehills | $215000 | $225000 |
| DLA Piper | $215000 | $225000 |
This chart is based on Chamber-Associate’s 2023 salary survey.
All five of these law firms are paying their lawyers an exceptional rate, but what else about them is appealing?
Akin Gump was founded in 1945 by Robert S. Strauss and Richard Gump having returned from the war needing jobs. They started their law firm in Dallas progressing rapidly as by 1970 they were opening their Washington DC office expanding their reach. They were already a well-established law firm and continually looking to the future.
“Future-focused and dedicated to excellence, Akin is an elite law firm that helps clients anticipate what is next and navigate a path to success.”
This law firm has always been involved in high-value projects and it started long ago in 1963 when Irving Goldberg, within Akin Gump, advised Lyndon B Johnson to take the oath of office. This is a key moment in the firm’s history and one they are proud of.
Akin Gump is now a global law firm with over 900 lawyers and advisors and 18 offices worldwide, Akin has grown in under a decade to become one of the largest law firms in the US. The London office is the hub of Akin’s international practice and is the firm’s third largest office.
They are renowned for numerous market-leading practices; their strengths are in complex transactions, financings and restructurings, high-stakes litigation, public policy, and regulatory matters; and the unyielding pro bono commitment. Their headquarters are based in Washington D.C. and with a third of their offices outside of the US they have an extraordinary global reach with 40 languages being spoken.
Founded in 1934 and based in LA they are a global law firm with offices in the world’s major financial, business, and regulatory centres. Latham & Watkins have offices in 14 different locations with the largest office in New York and 60 languages being spoken.
Law360 has stated that Latham & Watkins LLP was deemed the most social media savvy BigLaw firm in the U.S. this year by an annual analysis.
Not only are they among one of the highest paying law firms but they also pride themselves on their sustainability commitments and their Women Enriching Business Committee (WEB). They place a focus on the challenges within the business unique to women and address these for employees and clients.
In 2023 alone, Latham & Watkins made 34 new partners and 34 new counsel and among these, 5 partners have been named 2023 MVP of the year by Law360.
Opportunities at Latham and Watkins include juniors with first year and lateral associates being allocated resources to facilitate networking and other mentorship activities.
Latham & Watkins have a high number of high-profile projects including their success from their London finance team advising Permira and Blackstone on their “landmark private credit loan financing for a voluntary tender offer to acquire all outstanding ordinary Class A shares in Adevinta ASA.” Latham & Watkins are proud to announce that this is one of the largest European buyouts in 2023.
The Financial Times recognized Kirkland & Ellis as the “Most Innovative Firm in Digital Solutions” as part of its 2023 North America Innovative Lawyers Report. They were also named a standout firm in the Technology category by the Financial Times. They are following the legal trends of 2023 and successfully competing in more categories other than being one of the highest paying firms.
Founded in 1909, in Chicago, they have grown exponentially now having 3,500 attorneys in offices in 20 separate locations around the world. They are an international law firm serving a range of clients around the world in private equity, M&A, litigation, white collar, and government disputes restructuring and intellectual property matters.
“Each year, our Firm dedicates over 100,000 hours, investing substantial energy, talent and resources to pro bono initiatives across many significant areas.”
Kirkland is committed to taking on cases of immigration, LGBTQ+, veterans, incarcerated individuals and civil rights cases supporting those who need it most. Investing in cases like these gives the law firm a rewarding system of success.
With over 100 years of history, a 24-office global network and a record for best-in class tech and innovative legal operations, Herbert Smith Freehills are known for more than their high salaries.
In 2023, they were the winners of the Lawyer Award for energy and infrastructure team of the year along with real estate team of the year.
The Legal Cheek stated that juniors have commended them on their quality training programme and their mentorship. At the point of qualification, the law firm keeps on average 27 out of 29 trainees. They also report that the Work/life balance at HSF is better than the average law firm with encouragement to attend important life events and log off if the work is non-urgent.
Being one of the highest paying law firms and one that values their employee’s time they are a large competitor for other law firms recruiting top talent.
Compared to the previously mentioned firms, DLA Piper is relatively new as it is the outcome of a 2005 merger between one British and two US firms. However, being fairly new on the scene has not slowed them down as they are now third place among the world’s largest law firms by revenue. The firm operates in fourteen industries ranging from life sciences to construction.
Following legal trends of the time, DLA Piper is invested in supporting sustainability goals for the future. Giving importance to their pro-bono work, including providing free advice to nonprofits, UN agencies intergovernmental organisations and social enterprises. DLA Piper believe it is important to allow them to focus on their missions and objectives and taking out any legal fuss frees up their time to do so.
Their work to create a sustainable future has been recognised and in 2023 they were awarded the Terra Carta Seal from the Sustainable Markets Initiative. This award recognised DLA Piper’s active work to create a positive impact on the environment.
There are four dog breeds that have been banned in the UK since the 1991 Dangerous Dog Act was passed, criminalising ownership of these breeds. This act allows the Police to become involved if a dog is suspected of being dangerous.
The Dangerous Dog Act (DDA) of 1991 was put into place after a rise of attacks on people resulting in serious injury or fatality. The act is split into sections; Sections 1 prohibits the ownership of certain types of dogs, unless exempted which is intended to have a preventative effect. Prosecutions can be brought before a court based on the physical appearance of the dog. Section 3 states that it is a criminal offence to allow any dog to be out of control or behaving dangerously in a public place. Legal action can be taken against the owner or the person in charge of the dog at the time, if the dog does injure a person.
These dogs share similar traits of strength and large size making them popular with the illegal dog fighting trade leading to their ban in the UK and various other countries. Dog breeds are banned by the government to prevent illegal activity such as dog fighting as well as to prevent attacks on humans. The ban in 1991 came into fruition after a series of dog attacks with 11 serious attacks just that year.
What were the four dogs banned in 1991?
Pit Bull Terrier – These dogs were developed in the 19th century from a bulldog and a terrier for hunting, capturing and restraining feral livestock. Due to the Pit Bulls body and jaw strength they were often used as fighting dogs being treated poorly in order to induce an aggressive temperament. Metro News states that these dogs are banned in various countries including Australia, France, Israel, Hong Kong, many states in the US and cities in Canada.
Japanese Tosa – The Tosa was bred in the 1800’s with breeds such as the Bulldog and Mastiff to produce this heavy, agile and powerful dog. In the mid-19th century they were being bred as a fighting dog and so were quickly banned in the UK despite a small number being in the country.
Dogo Argentino – Developed in Argentina in the 1920s as a working dog. The Independent reports that this dog was produced for pack-hunting and big-game hunting coming from several dog breeds including an old fighting dog of Cordoba, the Viejo Perro de Pelea Cordobes, a dog which was nearly extinct at the time. The breed was banned in the UK due to them being imported into the country for illegal dog fighting.
Fila Brasileiro – More commonly known as the Brazilian Mastiff which is known in Brazil for its loyalty, Purina states. This dog is very strong and intelligent, originally used as a working dog and would catch their prey and hold it until the hunter arrived. This breed was also banned as a preventative measure due to dog being imported for illegal dog fighting.
On September 15th 2023, Rishi Sunak announced the plans to ban American Bully XLs in the UK. The UK government have set requirements and restrictions in place for the breed and owners of the breed to follow. From 31st December 2023 it will be against the law to sell, breed or rehome an XL bully breed. From 1 February 2024 it will be illegal to own an XL Bully in England and Wales unless your dog has a valid Certificate of Exemption. If you are found with a banned dog without a valid certificate of exemption you face an unlimited fine or up to 6 months in prison. The dog in possession will be taken away and in the absence of certification the dog will be destroyed.
There are legal requirements that must be followed by owners to ensure the safety of these dogs.
What are the next steps?
In regards to breeding, it will be illegal to do so. However, if the dog has already conceived them it will not be illegal for the puppies to be brought to full term. Although, it will be illegal to rehome or sell these puppies if they are born after 31 December. The government is allowing a 9-week period until this ban comes into force allowing puppies which were bred before this legislation was introduced to be legally sold. This allows for the puppies at the correct age of 8 weeks to be given a chance to find a home.
The XL bully is the first dog to be banned since the 1991 act due to a rise in attacks, as the Guardian reports that at least three of the seven attacks this year were linked to XL Bullies. As the breed is not officially recognised by the Royal Kennel Club there is no certainty of how many XL Bullies there are in the UK. The Bully Watch, a group which campaigned for the ban of the breed stated that they account for less than 1% of all owned dogs across the country.
The effectiveness of a ban is uncertain as data from the Metropolitan Police shows from 2015-16 which was 25 years after the DDA was introduced, pit bull terriers were responsible for 19% of dog attacks across London. The legislation will reduce the number but not eliminate the breed entirely and the concern of many is that a new breed will be introduced in the coming years.
Carraro Finance SA, Luxembourg entity belonging to Carrrao SpA, a global player in the development and manufacturing of transmission systems for professional off-highway applications, issued a senior unsecured bond for an amount of 120 million euros. Carraro Finance was assisted by Target for legal aspects and by Your Tacs, with Federico Franzina and Alessandro Cusumano for Luxembourg tax aspects.
Reflecting on 2023 helps us to highlight the trends that will follow us into the new year and those we can leave behind. The legal industry is ever moving and demands you to adapt if you want to guarantee success. The industry is heavily impacted by the social and political circumstances of the time as it serves society and the demands of clients. The legal landscape for 2024 brings growth to many sectors along with certain concerns seeping in too.
The way lawyers will have to work could be drastically changed with the billable hour being pushed out by client demands. The presence and growth of AI in law will follow us into 2024 with an even bigger emphasis on utilising these new tools. Law firms are losing revenue and 2024 will be detrimental to trying to make a switch for the better. The need to prioritise their own ESG concerns and law firms will be increasingly taking on more climate cases and will be under pressure from climate activists observing their goals and decisions too. Law firms will have to be ready for all of these and more in 2024.
Just a few of the trends that we predict for 2024…
With increasing pressure from clients for efficiency and corporations trying to manage costs the billable hours could become outdated. The Law Society Gazette reported that in 2023 nearly half of all external legal spending took place through alternative fee arrangements including flat or fixed rate rather than billable hours. This shift is likely to continue in 2024 as these appeal to clients managing their legal costs due to the cost-of-living crisis affecting businesses. PWC states that billable hours for full equity partners in the UK’s largest firms fell by 8.3% throughout 2023. This turn away from the billable hour leaves lawyers to introduce fixed rates for a project which clients believe will improve productivity. Rather than focusing on how much time lawyers spend on a project, they will focus on getting it done without delay as they will no longer be receiving more money the longer the project goes on.
BCL legal report that 63% of firms stated a difficulty in determining a profitable pricing system which prevents them from implementing AFA’s. However, in 2024 we could see a decrease in the billable hour as law firms have begun to utilise data analytics to determine their pricings and clients are appeased.
The rise of AI is hitting most industries and the question of whether AI can replace lawyers has been inducing fear for quite some time. The fear is fading as lawyers learn AI cannot emulate them perfectly and now the industry is getting on board and introducing new tech into the business as a support aid.
2023 has seen innovative ways to use AI including Allen and Overy launching ‘Harvey’ an AI-based chatbot to help draft contracts. Harvey has the ability to understand 43 different languages and generate and access legal content with unmatched efficiency, quality and intelligence. The technology was brought into the firm as a way to support more than 3,500 of Allen and Overy’s lawyers.
It is clear there will be an increase in the use of AI and tech as an increasing number of firms see its potential and Garter expects legal departments to triple their spend on legal tech by 2025.
In 2023 the legal sector saw a 6% growth, however, in 2024 it is predicted there will only be a +2% growth showing a decline reported by LexisNexis. Due to the economic situation, there has been a fall in demand in the legal sector as businesses strive to keep costs down and keep it internal.
Citigroup found that in the first nine months of 2023, revenues grew 4.8% but client demand declined by 0.7%. The time it took for clients to pay their bills lengthened by 5% whilst lawyer billing rates increased by 8.2%.
If law firms wish to increase their revenue for 2024 then using AFA’s or AI support could be the way forward.
With the concerns for the environment growing each year, 2024 will be no different and the legal sector is continually under observation of their actions towards ESG. Law firms will have to be honest about their own ESG goals as well as their client’s ESG commitments to avoid being in the spotlight.
A report from Columbia University states that the number of climate cases has more than doubled in the last five years, and litigation is expected to continually increase. The legal industry will see a continual rise in cases linked to ESG and climate change to create a positive impact. Climate litigation is being seen as an integral way to secure action and justice.
Cases not only include basic climate rights but also; Corporate liability and responsibility, keeping fossil fuels and carbon sinks in the ground, domestic enforcement of international climate change commitments and climate disclosures and greenwashing. Law firms will have to work to appease society’s climate anxiety and to preserve their status.
If you are reading this then you probably already know that being a lawyer is definitely not easy and may even be thinking about a switch. You aren’t the first and you won’t be the last. If your job in the legal industry has brought you too much stress and no time for yourself then you’re not alone and those who have gone before you can guide the way.
As the stress of working in the legal industry becomes too overbearing or the lack of a home life starts to take its toll, many look for an alternative career. Reported on the Singapore Law Society, in a study of international lawyers, 54% of them were likely to leave the profession by 2027. The hope for a better working environment and improved mental health overrides the ambition that draws them to the legal industry.
How to plan your break up with law
Leaving a career that you studied and worked in for years dedicating your time and effort to succeeding in is no easy feat. The worry that leaving what you know could result in failure or disappointment can get to even the most confident of people.
Accept a potential change in your budget - Many struggle to find a job which has the same financial benefits as working in the legal industry. Learn to accept that you may take a hit in your wage but decide whether your reasons for wanting a new job are worth leaving the money behind for. Learning new ways to make your money go further could be useful, but who knows, you could find something you love and still live comfortably. Going out less often and cooking at home is not an awful price to pay for a job that will give you that work-life balance we all crave.
Take time to review - Many take to travel, something you would never have time to do properly whilst having a demanding job with deadlines looming over you and clients badgering you non-stop. Taking in what the world has to offer provides many with a clear idea of where they want to go next and what they want to try. Finding something else you will be passionate about might seem daunting but trying new things is the only way to know. Take some time to figure out what you want to do next and prepare to start at the beginning. This is your excuse to take that trip you’ve been putting off and not have a single thought of regulations, meetings and bosses.
List your keywords - Think about what you do like about your current job and if these traits are what you want to find in the next. These could be good points for job searching and figuring out what field you want to enter. If finding something you like about your current job is too difficult then there’s no question, you should read on further.
What does life after law look like and can you repeat the success?
Lawyers can be anything – here’s proof
Don’t be worried about what you can do next, below are some examples of people just like you who needed a change. The most random passion you have could be your next full-time job if you let it, if you like juggling then go on the stage and if you like reading then start talking about it to strangers online, that seems to work for others.
Whether it’s teaching others on the same legal journey and showing students the ropes of being a lawyer or switching it up to work in a primary school, teaching seems to be a common choice. This can become a very rewarding career and much more fun in many cases as working with children could never be boring. Teaching provides people with a way to be more creative and still use their academic brains to help the young. Although it still has its stressful factors, teaching is a way to break away from the toxic corporate lifestyle.
The Legal Nomad blog interviewed Alvin Starkman who has now transformed his life after 18 years in the legal industry. His days now consist of teaching people about the culture of mezcal, agave, and fermented pre-Hispanic beverages such as pulque and their producers. Having worked as a litigator practising family law, Starkman has found his new life much more rewarding and fulfilling. Finding a place to live in the mountains, and discovering a passion in something which brings him happiness, Starkman may have found what many are looking for. Leaving the legal industry has brought a positive impact on his life and is a great example that leaving your career could turn into a lifestyle change you won’t regret.
Returning to a passion after pursuing a career in law is not going backwards but rather realising what you prefer. The Legal Nomad blog also took a dive into Andrew Comrie-Picard’s career change after a few years in the legal industry he ditched the shirt and tie and went full time into his motorsport passion. Andrew has now won multiple races, has a show on the Discovery channel called, ‘Car Saviours’ and has worked as a stunt coordinator on Top Gear USA even being a stunt driver for films and TV shows. Andrew didn’t want to be the one to represent the performers and the thrill seekers, he wanted to be the one enjoying the ride.
There are an endless amount of people who change their careers and you could join them, ever thought of being a baker? Well, many lawyers apparently would rather pick up a rolling pin than the gavel. Starting up your food blog could become a great success as it did for former Lawyer, Gesine Bullock-Prado. Gesine has now been on cooking shows and hosts baking classes at Sugar Glider Kitchen for those wanting to learn the skill. Since leaving law, Gesine has had a huge amount of success in her new field and her blog strongly implies she couldn’t be happier.
Those who can turn a hobby into their career are the lucky ones and this can happen for you too. Rob Freidman became known as ‘Pitching Ninja’ when he began tweeting about Baseball and this turned into something much more than a hobby for him. Now Freidman has worked on multiple TV networks as a pitching analyst including MLB’s channels. Freidman was a lawyer and began his baseball journey when he started coaching his son’s team, no time is too late to start something you may love.
Success looks different to everyone and when starting a new chapter it might be useful to think about what success is to you. Is it how much money you make? Is it the creative pieces you can produce? Is it how many people you can help?
Life after law can be a success for you as it was for those mentioned above, whenever you’re ready just take that first step.
Let us know what your dream life after law looks like, no matter how out of the box it may be, at info@lawyer-monthly.com
Georgiev & Kolev advised Vitosha Venture Partners in the investment deal from TokWise.
TokWise is a software providing the ability for renewable energy players to become active participants in the market and provides support in accurate decisions being made. This advanced platform bridges the gap between physical assets and complex electricity markets, helping to centralise renewable portfolio management. TokWise pride themselves on their improved accuracy reducing forecasting error and their reliability. Founded in 2018 with the mission to accelerate the digital transition in the energy industry with their built in AI-powered SaaS to optimise market decisions and manage renewable portfolios.
TokWise allows power producers such as, Encavis to link their assets directly to the power exchanges which enables them to take control of the purchase and sale of electricity. In turn this reduces the risk in today’s volatile energy market.
Encavis investing in TokWise will open new opportunities with access to new markets and expanding their exposure in the EU.
The EUR 3 million equity investment in TokWise included Vitosha Venture partners being advised by Georgiev & Kolev.
Q&A with Vanina Popova, head of the Venture capital team of Georgiev & Kolev
Could you provide further details regarding your professional responsibilities and involvement in this project?
Before I answer your question, allow me to clarify that the team of Georgiev & Kolev has a solid background in the field of Venture Capital (VC) as well as in other legal fields. Over the years we have had the opportunity to gain significant experience as we provided legal services to two alternative investment funds for venture capital (AIFs) - Vitosha Venture Partners and Morningside Hill. Currently, the VC team of Georgiev & Kolev is responsible for the full legal service of both Alternative Investment Fund Managers (AIFMs) regarding all matters related to the investment activity of the Alternative Investment Funds (AIFs) managed by them. The total resource of both AIFS amounts to appr. EUR 70 million and consists of public financing provided by the Fund of Funds in Bulgaria and additional private funding provided by the fund managers and independent private investors. We first started working with these companies in 2021 when our team was hired by them to provide legal guidance and to assist them in the process of the establishment of their VC Funds which required the successful award of a public procurement and the approval of their applications by the Fund of Funds. After that, we consulted the companies on matters in connection with the incorporation of the Funds and Fund Managers, as well as the registration of the latter before the Financial Supervision Commission. During this long process we developed a close professional relationship which led our clients to trust us to continue to consult them on a broad spectrum of legal matters– from their internal structure to their investment activities.
The investment round led by Encavis AG is the second investment round in which Vitosha Venture Partners (the first one was led by Vitosha) has actively participated by acquiring shares in the company’s capital. The VC team of Georgiev & Kolev, led by me, provided legal assistance to Vitosha Venture Parnters (VVP) with respect to both investments. Each equity or quasi-equity investment requires the preparation of around 100 documents which need to be drafted, checked, signed, and negotiated, and the follow-up investment in TokWise Ltd. was no exception. Our Venture Capital team, which I am head of, was responsible for the preparation of all the documents required for the approval of the investment by the Fund of Funds, the preparation of an in-depth due diligence report, and the carrying out of the necessary check-ups which ensure that the enterprise is compliant with the eligibility requirements set forth in the European regulations and the Regimes for state aid.
My colleagues, Maria-Magdalena Stoilkova and Preslava Petrova, and I represented the Fund in the negotiations in connection with the Investment and Shareholders’ Agreement in which more than 15 parties participated. Our Venture Capital team was first introduced to TokWise Ltd. and its Founders in 2021 when we drafted the Investment Agreement for VVP’s first investment. Our professional relationship with them has developed over the years and we are happy to witness the success in the development of TokWise Ltd. and their product as more investors are taking interest in the company.
How were your teams’ skills and capabilities best suited to this project and how were they all utilised for this project?
G&K’s VC team consists of 6 qualified professionals with extensive experience not only in the area of venture capital, but also in corporate law, commercial law, M&A, and IP rights. VC Funds usually invest in companies at an early development stage (start-ups) which are considered the so-called ‘SMEs’ in accordance with the Small and Medium Enterprises Act so we specialize in that area as well. We also consult our clients on the legal aspects in connection with the management of the portfolio companies of the Funds - follow-up investments (such as the one in TokWise Ltd.), new investment rounds, capital restructuring, reorganisation, share swaps etc. I believe all this gives us an extra ability to look at the big picture and be helpful to our clients in more areas. Since we often have to offer complex and broad legal services, our law firm values teamwork above all else. Working closely together and utilizing everyone’s specific knowledge and area of expertise, allows us to provide the best possible solutions for the client’s needs.
Our Managing Partner Georgi Valentinov Georgiev and we at Georgiev & Kolev like to say that law is a sort of societal physics, charged with settling the ever more complex relations in today’s society – not a self-contained regulator interfering with business operations.
Sticking to this motto, for the last two years, our VC team closed over 125 equity and quasi-equity investments totalling more than EUR 50 million. Many of these investments gave us the opportunity to work and become familiar with a variety of companies with different corporate structures and legal forms, including foreign legal entities for which there is no analogue in Bulgaria; others introduced us to entirely new businesses, projects, products, and market expansions. All these factors brought together helped us develop our invaluable know-how and business-oriented approach that I think set us apart from other firms. The members of our team devote their full and undivided time and attention to the clients’ specific needs and business objectives.
The investment round in TokWise Ltd. gave me and my colleagues, Maria-Magdalena Stoilkova and Preslava Petrova, the opportunity to utilise precisely those skills due to the fact that the company had developed since VVP’s first investment and had therefore entered into more business and legal relationships. With TokWise that was definitely the case as the company had grown from a pre-seed stage company to a start-up with a complex capital structure and a broad range of business partners.
During this project, were there any obstacles or challenges you faced, and how did you overcome them to ensure a successful outcome?
When more and more investors and business angels are showing interest in a company in which a Fund is already a shareholder, our biggest responsibility as lawyers is ensuring that the respective client’s rights are protected. Our understanding of the modern legal profession is that our service should not be limited to a simple interpretation of the law – we strive to create the optimal legal structure for solving clients’ problems using our creativity and taking into consideration both their needs and the legal options available.
Since more than a few parties participated in the negotiation process, it was important for us to be flexible and to take note of the business side of things, but to never compromise our client’s best interest. Our team prides itself on its creativity and ability to employ an individual approach to each client and we believe that this is one of the reasons why we were entrusted by such clients as VVP. Since most VC Funds in Bulgaria operate with EU funds, their activity should be compliant with the Public Procurement Act, State Aid rules, Regulations on ESI Funding, and many others. Because of this they are subject to many restrictions and therefore need to comply with a lot more requirements than the private funds do. This is a great example of a specific need of our clients that we always take note of as lawyers when protecting their interest, especially when it comes to negotiations with private investors who do not wish to comply with so many requirements so we always explain what the mandatory standards for the VC Fund are and what the responsibilities of the Fund Manager require it to include in all investment and shareholders’ agreements.
In the course of the latest investment round in TokWise Ltd. we were responsible for making sure all parties were familiar with the applicable EU Regulation and the Operational Agreement for the establishment and management of the Fund made by and between Vitosha Venture Partners OOD and the Fund of Funds pursuant to the awarded public procurement. Thankfully, we were lucky enough to be working on the TokWise Ltd. deal with other skilled professionals – the DGKV team (Partner Omourtag Petkov and Senior Associate Ivan Punev) who possess deep knowledge of the VC industry in Bulgaria and in the European Union, and together we were able to secure the successful execution of the agreement on fair and favourable terms without experiencing major difficulties in the negotiation process.
Could you walk us through the due diligence process conducted by your law firm to assess the potential legal risks associated with the investment in TokWise Ltd.?
Each Fund needs to make an informed decision about the company in which it invests so the legal Due Diligence Report (DDR) is a key part of the services we provide. It is focused (at the very minimum) on the review of general corporate history and status of the company, important material contracts and agreements with banks and other creditors, agreements on acquisition/disposal of material assets, commercial agreements, share purchase agreements, convertible loans, and other contracts for the acquisition of share capital, employment issues, intellectual property, pledges, mortgages and other encumbrances of the company’s assets and litigation proceedings. When it comes to follow-up investments, such as the equity investment in TokWise Ltd., one could think that since the Fund is already a shareholder, it is informed about the company’s legal matters. However, many things may have changed over the years or months after the first investment, and it is crucial to do a ‘deep dive’ when preparing a Due Diligence Report regarding the newly occurred circumstances. This is necessary in order to ensure that the Investor is aware of the company’s state and legal affairs before providing more funds to it in the form of an equity or quasi-equity investment. Apart from pointing out potential legal risks, our reports also include recommendations on how some issues may be omitted or solved so that the company’s documents are legally sound before the Investor becomes involved. This approach benefits not only the VC Fund, but the Final Recipient, as well.
Given the complexities of renewable energy markets and technology, how did your firm ensure compliance with the regulatory landscapes as more companies at an early development stage with business ideas revolving around renewable energy are looking for venture capital financing?
Venture capital is a complex industry, and it is far from enough to understand only corporate law to be a successful lawyer in this industry. In order to represent the interests of your client - regardless of whether it is an institutional investor, business angel or even a founder, it is necessary to have in-depth legal knowledge and a broad view of business, to be interested in new trends, legislative changes and innovations.
It can be said that Georgiev & Kolev Law Offices had a vast experience in venture capital even before it gained popularity here in Bulgaria. Understanding the main clauses in the shareholders’ agreements is definitely not enough. In order for our team to deal with it successfully, with every single investment, they familiarize themselves with the company's business and the activities it performs in order to navigate the regulatory frameworks that regulate it. Every single document we draft - from the check-ups for compliance of the company with European requirements related to the public financing, through the conduction of a legal due diligence report, to the investment agreement, is tailored to the specific business of the company in question. Only in this way, can the interest of our clients be fully protected, because the documents must reflect the real situation.
As for Tokwise, the company is no exception. Renewable energy has been gaining more and more interest in recent decades. The European regulatory framework puts renewable energy on the map of the energy market, with the EU aiming for at least 42.5% of energy consumption to come from renewable energy by 2030. The pillar of the European Green Deal is namely the renewable energy, and this entire legal framework was taken into account when closing the investment in TokWise Ltd., which we believe will become one of the successful deals for our client Vitosha Venture Partners Fund I partnership.
Waterwheel Capital Management was advised by Koutalidis Law Firm on this deal to purchase 95% of the class B and Class C notes issued in the Securitisation of the Solar portfolio. Waterwheel entered into binding agreement for the acquisition with the 4 originating banks, Alpha Bank, Eurobank, the National Bank of Greece and Piraeus bank.
Waterwheel Capital Management, a US based alternative investment firm founded in 2017, invests with the goal to generate absolute returns on dislocated opportunities through targeted investment vehicles. They are focused on strategies, capitalising on opportunities in Greece whilst using a value investing approach.
The Solar Portfolio has an on-balance sheet value of roughly EUR 1.2 billion and consists of common non-performing exposures of corporate and SME loans. This securitisation is the first of its kind in Greece involving four originating banks.
Koutalidis has been advising Waterwheel through all steps of the bidding process and negotiation of the contractual documentation with the four banks.
The strategic partnership includes:
UniCredit is a commercial bank serving over 15 million customers worldwide. They have a unique service offering in Italy, Germany, Central and Eastern Europe.
Alpha bank was founded in 1879 and is the fourth largest bank Greek Bank by total assets. It holds a subsidiary and branch in London, England and has subsidiaries in Romania and Cyprus too.
Alpha Bank was advised by Koutalidis.
Randall & Payne LLP advise Des Mcmanus in the acquisition of a majority share in FFS Beauty.
FFS beauty is a female shaving company that promotes sustainable, cruelty free products whilst providing women with a quality product. FFS beauty is a UK business winning awards in the beauty industry since 2019. At FFS beauty they place importance on reducing their impact on the environment and even set up their own in house recycling scheme for customers. FFS beauty created the first ever metal handled razor for the female market which won product of the year in 2019 and this was only the start of their mission to introduce quality to the overlooked women’s shaving industry.
Prominent advisors supported the management buyout of FFS beauty as Des McManus takes over as executive chief. As one of the founding shareholders of this business McManus is confident that FFS will thrive in the coming years rising in the industry as a quality product for women.
The deal facilitated the exit of a shareholder combined with refinancing of the business for the next stage of its growth plans.
James Geary, Corporate Tax Partner at Randall & Payne, provided advice around the structure of the deal to ensure overall tax efficiency, as well as to preserve Enterprise Investment Scheme status for minority investors, dealing with the associated advance clearances from HM Revenue & Customs.
The deal was led by Debretts Private Finance with the legals being handled by Ansons.
Law firms are popular victims of this cybersecurity threat due to the high volume of sensitive data they hold. Data collected from Black Fog, a data protection site, found that the increase of ransomware attacks was up to 49% in the first six months of 2022 and is believed to be on a continuous rise. They reported that the legal sector accounts for 2.3% of all ransomware attacks making it the fourth most attacked industry in the UK in 2022 with an expected rise to come. The USA experienced the largest amount of attacks in 2022, with thirty-six incidents that were publicized, following this was with seven attacks. Ransomware has been so successful that the demand prices are increasing, further financially damaging a company.
If a company decides to pay the ransom it could face a severe asset freeze from the government as this is seen as funding criminal activity leaving the victim with a high-risk decision to make.
There are different forms of Ransomware with different levels of risk, the most well-known being crypto-ransomware. The files become locked and the content is inaccessible to the company without the decryption key. Having sensitive data within the files creates a temptation to give in to the threat as the legal industry has a commitment to hold confidential files for various clients and businesses. Lockers is a form of Ransomware that locks the company out of its system displaying a lock screen to present the ransom demand, often with a countdown to intensify the situation. Scareware is fake software claiming to have detected a virus and points you to pay to resolve the problem. This can be in the form of locking the computer or a mass influx of pop-up alerts on the screen.
The legal industry is no longer safe and ransomware gangs do not discriminate based on the size of the company or revenue generated leaving anyone vulnerable. Those with £100 million were targeted equally as much as those with less than £3 million in revenue. Small companies often lack the resources necessary to prevent these strikes leaving them in danger. Larger companies are most likely to carry a high number of sensitive files and likewise have the means to pay the ransom sum.
The personal data held by all legal firms is appealing to these criminal organisations causing an increase in attacks. This threat means one thing for the legal industry, the need for sophisticated security is becoming a priority.
Law firms who have experienced an attack
There are many reported incidents of ransomware, and not all lead to data being recovered. These gangs are ruthless and intelligent. There is also confidence in their threats receiving attention, leading to an increased monetary demand.
Preventative measures that need to be taken
Preventing these attacks is much more effective than trying to respond to an attack once it has taken hold of the software. Once they have made their way into the network, the damage has been done and you are in a vulnerable position at the mercy of the cyberthief. The options are limited, either allowing the data to be stolen or compromising the integrity of the business and client information. Or paying the ransom to restore data, leading to legal consequences. Make sure security measures are in place to protect your files and your clients.
Dealing with Ransomware and your legal responsibilities
In May 2019, the UK enforced financial sanctions under the Cyber sanctions regime. The aim here was to prevent cyber activity which would undermine national security. The person imposing the breach will face asset freezes and travel bans, causing any money that was attained from ransomware to be inaccessible to the criminal organisation.
When dealing with an act of ransomware, the first step should be to report it to the Action Fraud centre. The HMG will carefully investigate whether the incident was reported particularly If ransomware payments were made. If the investigation finds the payment was made for the best interest of the public it would lie with the prosecuting authorities to determine whether prosecution was required.
The government discourages paying the ransomware as it threatens security, encourages criminals to repeat the act, and it does not guarantee that attackers will allow the company to restore data as 20% of organisations who paid the ransom could not recover their files.
The legal industry is at high risk from these ransomware attacks which are only increasing, make sure files are protected and software is secure to reduce the risk of being their next victim.
