The standout performer from this year’s second 25 is once again Mishcon de Reya which, along with Macfarlanes, has been the pace setter in this peer group over the last five years. The firm has come a long way since it first made its debut into the top 50 four years ago in 2012. Over five years, revenue has climbed more than 100% from £65m.
Mishcon revealed robust profits for the 2015/16 financial year, with profit per equity partner (PEP) up 11% to £1m as global revenue grew to £132.7m from £116.7m, an increase of 14%. The firm did, however, this year downsize its Manhattan practice to focus on IP. As such, New York revenue came in at £4.8m, a considerable drop given the business in recent years generated upwards of £13m.
In the last year, Mishcon made a host of key hires, including private client partner Martin Davies from Clyde & Co, who has experience in the Middle East; disputes partners Sonia Campbell and Annabel Thomas from Addleshaw Goddard and Enyo Law respectively; and Nick West, the London general manager of alternative resourcing business Axiom, to the newly-created role of chief strategy officer.
Litigation makes up the lion’s share of the firm’s £127.9m UK revenues – accounting for 34%. Major disputes include acting in a £128m claim against The Royal Bank of Scotland (RBS) and KPMG brought by former Torex Retail chief executive Neil Mitchell, as well as representing several institutional claimants in the long-running £4bn shareholder group action against RBS, a dispute brought over the bank’s £12bn rights issue in 2008.
Looking forward, the firm is set to execute a refreshed business strategy for the next decade, with a target to lift UK revenue by 40% to £175m within the next three years. Significant investment in technology and assessing the potential for artificial intelligence initiatives is on the cards in a bid to liberate fee-earners, and ultimately, for the firm to become a broad-based consultancy business following the rollout of its private client and e-discovery ventures in recent years.
LB: How has the year fared for Mishcon?
Kevin Gold: The corporate practice has grown a lot through hiring and a pick-up in M&A activity. The growth of that also means it is more susceptible to political risk now: such as Russia and the CIS retraction of capital risk or more Saudi money coming in with political turmoil in the Gulf. A lot will now depend on London’s standing post-Brexit and the relief from all this xenophobia and anti-immigrant sentiment. It’s generally been a welcoming city to international investors but the language of the press has become more hostile.
You have been reviewing the firm’s remuneration system this last year. What is the structure now?
‘A lot will now depend on London’s standing post-Brexit and the relief from all this xenophobia and anti-immigrant sentiment.’
Kevin Gold, Mishcon de Reya
Gold: There was a time when I inherited the firm where originators were divided between ‘A list’ and ‘B list’. Now it’s purely one metric within a broader spectrum. You might say: ‘My job is being a brilliant originator’ and that counts for a lot in your favour. That does count towards how you will be remunerated. But if you’re a brilliant technician and you work 20 hours a day, you won’t be penalised because you haven’t brought in work. We allow ourselves to look at contribution in the round and look individually at someone’s contribution. There are no origination points. Everyone is looked at individually as well as their contribution.
What other changes have there been?
Gold: The New York office has become a patent-only business over the last year. We realised what our strengths and weaknesses are. We are not a pan-national firm with multinational clients needing representation in New York. The patent business is niche and is easy to stand alone.
Do you anticipate continued growth?
Gold: We will slow down because of our size rather than through performance. Ultimately the independent market – including firms like Macfarlanes and Travers Smith – is being splintered either into boutiques or big internationals. That creates certain opportunities and threats. I wouldn’t be shocked if both Macfarlanes and Travers said they would stay independent.