‘We want to be a top 50 law firm. We have the trappings, but we’re not quite there yet.’ So said TLT managing partner David Pester to Legal Business three years ago. This year that ambition has been realised, with the Bristol-based law firm entering the top 50 for the first time.
TLT continued its strong growth trajectory in 2015/16, posting a 15% increase in turnover to £71.6m while profit per equity partner (PEP) was up 10% to £253,000. Overall, the firm has grown in turnover 65% from £43.3m over the last five years, particularly impressive considering the firm’s place in the squeezed national mid-market.
According to Pester, the performance is down to a combination of factors: ‘It’s about staying true to our industry focus, deepening the expertise, expanding the geographic footprint, but being very clear about trying to stay relevant to clients.’
TLT has invested in geographic expansion in that time, moving from three offices in 2011 to seven at the end of the last financial year, while lawyer headcount has expanded from 217 to 338 fee-earners.
‘We definitely benefited across the UK – and that includes the work we are doing in Northern Ireland and Scotland as well – from the growth and development in our energy and renewables practice,’ adds Pester. ‘We also saw additional clients in our leisure and retail sector group and that was around having industry expertise relevant to what activities those clients were undertaking. We are ahead of expectations for Manchester and that has grown larger than originally anticipated, which is fantastic.’
Highlights for the firm in 2015/16 include winning a place on Yum! Brands’ slimmed-down roster, as well as the North West Legal Consortium’s legal panel, positioning the firm to work with local authorities associated with over 40 councils in the North West of England. The firm also appointed former real estate head Andrew Glynn as senior partner after Robert Bourns stepped down to become president of the Law Society in July and announced investment into its Bristol headquarters following the expansion and refurbishment of its Belfast, Edinburgh, Glasgow and Manchester offices across the last three years.
‘You need to work out where you want to be and how you stay relevant to your clients.’
David Pester, TLT
Pester says there are opportunities for mid-market firms as long as they remain tightly focused, well-structured and profitable to allow for significant investment.
‘You need to work out where you want to be, what is the best delivery model and how you stay relevant to your clients. And that is true of any law firm at any point in the market.
‘There is an opportunity in the UK for a certain number of firms to become focused around industry, the UK mid-market.’
LB: What is your outlook for the next 12-18 months?
David Pester: One of the key things over the next few years will be working out how you unlock the potential in any organisation in what is going to be a market where – if you are particularly UK-focused – it may be flatter. It is about winning market share – how are you going to win market share? How are you going to differentiate? How are you going to continuously improve?
Why do you think growth has been generally slower in the mid-market this year?
Pester: The UK legal services market was seeing some effects in certain areas in anticipation of the referendum vote and that has already started to have some impact on the timing of investment decisions. Our practice, which has a good balance of litigation and transactional work, saw an increase in the share of work we were winning in the UK. But [that] is because we remain very focused on certain industries.
What advice are clients looking for post-Brexit?
Pester: A lot of the client base acknowledges it is too early to assess the impact of Brexit but people are beginning to look at the impact on any cross-jurisdictional trading activities that they have. Clients are considering the impact of sterling fluctuations on their supply chain network; they are looking at investment decisions. So far we haven’t seen a major slowing of key investment decisions but there have been suggestions around pricing of transactional activity because of the movement in sterling and the dollar.