On The Hunt For Laterals
Ricardo Fernandez invaded Fort Lauderdale this summer.
And that created buzz in the city’s legal community, the kind of talk that follows him wherever he goes in Florida, hiring lawyers away from their firms.
As hiring partner in Miami-based Fowler White Boggs Banker, he is, perhaps, sui generis in the law firm world. He’s an in-house headhunter.
There will be none of the soft-shoe mating dance known to traditional headhunters, who make cold calls to targets and, with polite misdirection, ask if they know anyone in their practice area who might be interested in jumping ship. Fernandez opens more directly: “Take this call as a compliment. It’s intended to be. I’m Rick Fernandez with Fowler White and we’re interested in an opportunity with you. Would you like to talk?”
Fernandez knows the game only too well. When he neared the 20-year mark in his law practice, in the late 1990s, he left the law and joined the headhunting business. He ran the south Florida operation for a national legal search firm. After a couple of years, he returned to law practice, joining Fowler White in 2003. But soon he was named hiring partner. And that quickly became full time.
While Fernandez does some things differently and more directly than traditional headhunters, he still carries their quiver of tactics. For example, he tries to get into the office earlier than typical law firm secretaries and receptionists so he can direct-dial lawyers when they are likely to pick up the phone. He does the same in the early evenings.
“It’s gotten to the point that I’d rather people at those firms not know it’s Rick Fernandez calling, because I’m getting known for it,” he says of avoiding gatekeepers.
If Fernandez hadn’t cut this career path, someone else surely would have invented it. Lateral movement among law firms not only has lost its stigma, it has become a way of doing business. Partnerships, in many instances, have become more contractual relationships than the traditional mix of personal and professional bonds. Now it’s just a matter of finding and making the right matches.
“Where are all these headhunters coming from?” asks Linda Klein, managing partner of Atlanta’s 34-lawyer Gambrell & Stolz. “There are so many of them now I don’t know how they make a living.”
Klein starts most days with a voice mail from a headhunter making a cold call. Some want her to come over to another firm. Some want to offer her a “stupendous opportunity” to hire a certain lawyer.
Illustrative of the times, her firm hires only laterals. It is a general practice firm, handling just about everything in civil law except divorces. And its niche, to the extent there is one, is in working for business entrepreneurs and eventually taking them public. Typically, the firm’s clients aren’t “interested in paying young lawyers, and sometimes they resent it,” Klein says.
Some Gambrell & Stolz partners prefer to find laterals through networking, but that’s not practical when the firm needs someone in a particular practice area immediately. “So I’ll make a note to call a headhunter, but my work gets ahead of that,” says Klein. “Then comes the cold call. I haven’t had to seek out headhunters the past couple of years because they just call all the time.”
There are no available statistics on the number of headhunters and search companies. The National Association of Legal Search Consultants has grown to 180 members since its inception in 1984. But the association’s president, Marina Sirras of New York City’s Marina Sirras & Associates, says the numbers have increased significantly and are much greater than that. Not all recruiters or search firms join the association.
Though they don’t constitute the bulk of her business, Sirras specializes in targeted searches. A law firm will provide her the name of a lawyer it would like to hire. “I’m to feel them out and see if they’re interested in talking,” she says. “As soon as I hear them say ‘Let me close the door,’ we know they are.”
Though the market is fluid and lawyers with portfolios move around now like free-agent professional athletes, the cold calls most often turn just that, cold.
Fernandez has been there. “I get rejected all the time, but it’s nice rejection,” he says. “The sales mantra is that every no is the next step to a yes. I’ll hit 20 prospects to get one engaging with me.”
Hiring laterals is a science for Greenberg Traurig, which, says president and CEO Cesar Alvarez, has hired more laterals than any other U.S. firm. The Miami-based law firm has almost doubled in size since 2001 to nearly 1,600 lawyers. While many firms look mainly at practice area matches when seeking laterals, he says, Greenberg Traurig also emphasizes geography. The firm has 26 offices in the U.S., as well as seven in other countries.
“Our theory is that law is very local and you need to have depth in those geographic locations,” says Alvarez. “If you’re litigating in Phoenix, you want to make sure you have litigators in Phoenix.”
Alvarez keeps the spreadsheets on lateral hiring. For example, he says the firm’s growth rate is about 20 percent a year through lateral hires and the attrition rate is about 3 percent to 4 percent. He compares that to “peer” firms that he says have growth rates of 6 percent to 7 percent and attrition rates of 6 percent to 7.5 percent.
He says the firm mostly hires lawyers by ones and twos, though on occasion it has taken on 20 to 25 lawyers in one practice-area swoop.
Obviously, Greenberg Traurig is one of the biggest, if not the biggest, users of search firms. Alvarez speaks of lawyers in law firms as “intellectual capital” and headhunters as the “investment bankers” who bring in that capital. But still, matchmaking is what it’s all about.
Platforms are key. A lawyer in a particular practice area might be able to better grow a practice in another firm with practice areas that offer synergy for that practice. For example, Sirras recently worked on finding a new firm for a partner who practices employment law but most of whose clients—consumer products companies—need intellectual property representation as well.
“If he can go to a firm that has an IP practice,” says Sirras, “he can get more business and so can his new firm.”