A new law firm model for all times

The global financial crisis is providing
new opportunities for a successful group
of sophisticated small law firms that aim
to prosper in both the good and the
challenging times, says Gerard Pérez
Olmo, one of the three founding partners
of Madrid-based GOLD Abogados.

'The top boutique firms may not only
offer high quality services, as their
lawyers have invariably been trained at
major international firms – and have
perhaps a greater hunger for work – but
can also operate on very competitive
terms because of their smaller teams and
lower overheads,' he notes.
What has proved surprising however
in the current environment, he says, has
been that many firms that may once have
slipped below the radar of major clients
are now regularly competing with some
of Spain's biggest legal players.
'We are seeing many boutiques
coming up against the major firms in the
top-tier of the market, where clients have
begun to recognise them as an
'alternative' option, as well as in the midmarket
where the biggest firms are now
increasingly chasing opportunities.'
What clearly helps many small firms
also is that they have concentrated
primarily away from the bigger ticket
corporate and private equity arenas, adds
Pérez Olmo.
'The focus is often instead on conflicts,
litigation and arbitration, regulatory and
competition matters, or infrastructure and
energy projects where there has continued
to be significant activity even in the face of
the economic crisis, or in areas in which
the major firms have no tradition of
expertise – such as private enforcement of
competition law, which remain emerging
areas of practice in Spain.'
He nonetheless denies that it is the
boutiques that are responsible for driving
down legal fees to an unsustainable level
and insists that it is firm economics that
determines pricing, and perhaps the
increasing desperation of some to chase
market share.
'The truth is that smaller firms have
the margin to be more flexible due to
their lower fixed-cost structures although
I have been surprised to see, in some
cases, that many much larger firms are
offering their services at a rate that would
not even be viable for a firm such as ours.