Solo/Small Exit Plan: The Biglaw Buyout

Could this be your potential end game?

The path from startup to buyout is a widely recognized exit strategy in the tech world — and indeed, one that has become a more popular strategy than aiming to take a company public. With IPO activity still far short of the levels it reached back in the late 1990s, buyouts are an equally attractive path to growing a small company.

When most lawyers start firms, they’re thinking neither of IPOs nor buyouts. Because of the ban on outside ownership of law firms, selling shares in a firm to investors still remains verboten under today’s ethics rules. As for buyouts, startup lawyers typically have their eye on growing their practice rather than priming it for acquisition by another firm.

Still, in the past couple of days, I’ve noticed a string of small, specialty law firms that have been willingly swallowed up by bigger fish.  Earlier this week, newly formed Womble Bond (a mashup of Womble Carlyle and British firm Bond Dickerson) acquired Bennett and Bennett, a D.C.-based, husband and wife-run telecom boutique.  Also this week, Squire Patton and Boggs scooped up the Yarborough Law Group, a small shop focused on cybersecurity and data privacy.

To be sure, large firms have always merged and absorbed other practices. But these recent acquisitions seem to be more deliberative than assimilation just to add bodies — a problem that fellow ATL columnist Mark Herrmann wrote about here, expressing concern that these mergers could dilute law firm quality. Instead, the Womble/Bennett and Squire/Yarborough acquisitions appear to have been targeted as a quick way for the large firm to incorporate a new and highly specialized practice area that could otherwise take years to cultivate. It’s very much like Airbnb’s recent acquisition of Accommable — a site that connects disabled travelers with accessible rentals — which gave Airbnb a shortcut to come into compliance with disability laws.

Given that large firms are becoming more deliberate about buying out small practices, maybe it’s time for solos and smalls starting out to think about a Biglaw buyout as a potential end game.


Carolyn ElefantCarolyn Elefant has been blogging about solo and small firm practice at MyShingle.comsince 2002 and operated her firm, the Law Offices of Carolyn Elefant PLLC, even longer than that. She’s also authored a bunch of books on topics like starting a law practicesocial media, and 21st century lawyer representation agreements (affiliate links). If you’re really that interested in learning more about Carolyn, just Google her. The Internet never lies, right? You can contact Carolyn by email at elefant@myshingle.comor follow her on Twitter at @carolynelefant.

Sponsored