How are Elite law firms any better than non-Elite ones?

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SOCRATiC
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How are Elite law firms any better than non-Elite ones?

Postby SOCRATiC » Mon Apr 04, 2011 10:19 pm

Besides prestige, how do the most elite law firms (i.e. Skadden, Cravath, Sullivan, etc.) differ from that of other V50ish law firms? Obviously, the more prestigious firms have higher PPP, but partnership is out of the question for me; I just won't make the cut. So I'm sort of asking this question in a newly minted law school graduate's perspective (I'm not even in law school yet, but am working in industry).

Wachtell obviously differs from the rest, since the firm offers noticeably superior compensation and a constant flow of presumably "cutting edge" legal work. But I don't see how the other V5 or V10 law firms actually differ from the V50 besides firm culture and "presitge". Can someone knowledgeable enlighten us?

Thanks.

BlueDiamond
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Re: How are Elite law firms any better than non-Elite ones?

Postby BlueDiamond » Mon Apr 04, 2011 10:23 pm

you answered your own question.. better prestige better exit options

why do people like YHS more than other tier 1 schools? prestige and exit/career options

foxtrottortxof
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Re: How are Elite law firms any better than non-Elite ones?

Postby foxtrottortxof » Mon Apr 04, 2011 10:25 pm

Seconded^

Add newsworthiness of work, as well.

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ResolutePear
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Re: How are Elite law firms any better than non-Elite ones?

Postby ResolutePear » Mon Apr 04, 2011 10:25 pm

SOCRATiC wrote:Besides prestige, how do the most elite law firms (i.e. Skadden, Cravath, Sullivan, etc.) differ from that of other V50ish law firms? Obviously, the more prestigious firms have higher PPP, but partnership is out of the question for me; I just won't make the cut. So I'm sort of asking this question in a newly minted law school graduate's perspective (I'm not even in law school yet, but am working in industry).

Wachtell obviously differs from the rest, since the firm offers noticeably superior compensation and a constant flow of presumably "cutting edge" legal work. But I don't see how the other V5 or V10 law firms actually differ from the V50 besides firm culture and "presitge". Can someone knowledgeable enlighten us?

Thanks.


How are they better? Or how do they differ?

And, is this a conversation worth having? If you can go with a V5 or a V50.. what would you go with at the end of the day? Outside of several important external factors mutual to both.

FiveSermon
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Re: How are Elite law firms any better than non-Elite ones?

Postby FiveSermon » Mon Apr 04, 2011 10:27 pm

I've asked this before and most people said it offered better exit options. They said most firms pay market anyways.

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vamedic03
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Re: How are Elite law firms any better than non-Elite ones?

Postby vamedic03 » Mon Apr 04, 2011 10:31 pm

SOCRATiC wrote:Besides prestige, how do the most elite law firms (i.e. Skadden, Cravath, Sullivan, etc.) differ from that of other V50ish law firms? Obviously, the more prestigious firms have higher PPP, but partnership is out of the question for me; I just won't make the cut. So I'm sort of asking this question in a newly minted law school graduate's perspective (I'm not even in law school yet, but am working in industry).

Wachtell obviously differs from the rest, since the firm offers noticeably superior compensation and a constant flow of presumably "cutting edge" legal work. But I don't see how the other V5 or V10 law firms actually differ from the V50 besides firm culture and "presitge". Can someone knowledgeable enlighten us?

Thanks.


All of the V10 are going to have 'cutting edge' or high stakes legal work. Clients can't afford to send their run of the mill/low stakes legal work to them.

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SOCRATiC
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Re: How are Elite law firms any better than non-Elite ones?

Postby SOCRATiC » Mon Apr 04, 2011 10:34 pm

-.-

I'm afraid my poorly worded question evoked a lot of condescending responses.

Any hows, I guess it's safe to conclude that the only actual benefit is the boost in pedigree.

Thanks a lot guys.

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Re: How are Elite law firms any better than non-Elite ones?

Postby paulinaporizkova » Mon Apr 04, 2011 10:36 pm

SOCRATiC wrote:-.-

I'm afraid my poorly worded question evoked a lot of condescending responses.


i did not see one condescending response to your post

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ResolutePear
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Re: How are Elite law firms any better than non-Elite ones?

Postby ResolutePear » Mon Apr 04, 2011 10:42 pm

Hey guys, on the same topic..

What's the benefit of going to Harvard or Stanford versus UF?

WHAT. IS. THE. BENEFIT...

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Re: How are Elite law firms any better than non-Elite ones?

Postby vamedic03 » Mon Apr 04, 2011 10:47 pm

SOCRATiC wrote:-.-

I'm afraid my poorly worded question evoked a lot of condescending responses.

Any hows, I guess it's safe to conclude that the only actual benefit is the boost in pedigree.

Thanks a lot guys.


I'm a little confused by what you were trying to get at by your original question. If you're asking why do people want to go to V10s, then:

(a) High quality legal work
(b) Great exit options
(c) Job stability

Also, I think that your original post was very incorrect in asserting that Wachtell is somehow different. All the V10's do cutting edge work and have different strengths and weaknesses. And clients know this which is why they (a) pay the high per hour rates and (b) continue to go to the V10s during economic crises.

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SOCRATiC
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Re: How are Elite law firms any better than non-Elite ones?

Postby SOCRATiC » Mon Apr 04, 2011 11:00 pm

Thanks for summing it up for me.

ResolutePear: Get a life.

2LLLL
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Re: How are Elite law firms any better than non-Elite ones?

Postby 2LLLL » Mon Apr 04, 2011 11:02 pm

Wasn't Latham in the V10 at the time of its infamous layoffs?

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ResolutePear
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Re: How are Elite law firms any better than non-Elite ones?

Postby ResolutePear » Mon Apr 04, 2011 11:04 pm

SOCRATiC wrote:ResolutePear: Get a life.


Already dead on the inside. Never missed it. :)

Sup Kid
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Re: How are Elite law firms any better than non-Elite ones?

Postby Sup Kid » Mon Apr 04, 2011 11:09 pm

2LLLL wrote:Wasn't Latham in the V10 at the time of its infamous layoffs?

Yep, it went from V7 to V17. As ATL put it at the time "Latham fell ten spots in this year’s Vault rankings — one of the biggest one year drops in the history of the Vault rankings."

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Re: How are Elite law firms any better than non-Elite ones?

Postby Anonymous User » Mon Apr 04, 2011 11:57 pm

G. T. L. Rev. wrote:No. The differences are as follows:

1. The work is higher profile. All large firms work on some big time matters, but the higher you go up the food chain, the more often this will be so. Most clients cannot afford to hire Wachtell or other elite firms for rinky dink stuff. If you look to smaller firms that people think very highly of (e.g., Bartlit Beck; Kellogg Huber; Susman Godfrey), you might also get more responsibility and "stand up" experience early on than at a generic V50. But for the large firms, like CSM, that isn't remotely true.


So much CSM hate on here tonight. CSM's system actually throws associates into the fire (in a good way) much more quickly than its peer firms. Please get your facts straight before misleading impressionable 1Ls. CSM is a tough firm with an atmosphere that might not appeal to all students, but lack of substantive experience certainly isn't one of its drawbacks.

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Re: How are Elite law firms any better than non-Elite ones?

Postby Watson » Tue Apr 05, 2011 12:09 am

SPRINGBONUSSECURE

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Stanford4Me
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Re: How are Elite law firms any better than non-Elite ones?

Postby Stanford4Me » Tue Apr 05, 2011 12:16 am

ResolutePear wrote:Hey guys, on the same topic..

What's the benefit of going to Harvard or Stanford versus UF?

WHAT. IS. THE. BENEFIT...

DukeLawStudent
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Re: How are Elite law firms any better than non-Elite ones?

Postby DukeLawStudent » Tue Apr 05, 2011 12:19 am

You get the Royal Jelly.

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Re: How are Elite law firms any better than non-Elite ones?

Postby climber » Tue Apr 05, 2011 3:55 am

The main difference between V5 and V50, is that the V5 tend to have strong relationships with bulge bracket investment banks. There are only a handful of them, so if you represent them you get access to a tremendous amount of very lucrative, high margin work in the area of corporate finance. Things like mega mergers, underwriter's counsel for IPOs, litigation related to such deals, etc. That's why the top firms are mostly in NYC. Once you diversify too much outside of that type of work, it is still profitable but dilutive to profits per partner. Firms like Latham are not underwriter's counsel, but places like Skadden, Wachtell, and S&C are. Latham needs to compete with hundreds of firms to become issuer's counsel, but only a handful of NYC firms represent the underwriters and get fees from many more deals.

It's also why those firms are such prestige hounds, as their clients are businesses full of Ivy league types.

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Re: How are Elite law firms any better than non-Elite ones?

Postby verdandi » Tue Apr 05, 2011 10:08 am

climber wrote:It's also why those firms are such prestige hounds, as their clients are businesses full of Ivy league types.


Nailed it. A lot of prestige hunger is a self-perpetuating phenomenon driven by firms' desires to show the clients they really are the best of the best and the banks' desire to hire the best of the best. With new blood coming into firms all the time, the only proxy for quality in new associates is school+performance, e.g., T14+LR or some other grade proxy (magna, summa, coif, etc.). It's ugly, but it's also unavoidable if you want to be involved in New York high finance work.

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Re: How are Elite law firms any better than non-Elite ones?

Postby paulinaporizkova » Tue Apr 05, 2011 10:09 am

SOCRATiC wrote:
ResolutePear: Get a life.

:lol: :lol: :lol:

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Re: How are Elite law firms any better than non-Elite ones?

Postby alumniguy » Tue Apr 05, 2011 10:49 am

G. T. L. Rev. wrote:No. The differences are as follows:

1. The work is higher profile. All large firms work on some big time matters, but the higher you go up the food chain, the more often this will be so. Most clients cannot afford to hire Wachtell or other elite firms for rinky dink stuff. If you look to smaller firms that people think very highly of (e.g., Bartlit Beck; Kellogg Huber; Susman Godfrey), you might also get more responsibility and "stand up" experience early on than at a generic V50. But for the large firms, like CSM, that isn't remotely true.

2. The job security is marginally greater. Layoffs occurred with much greater frequency outside the V10 than inside it. Same with salary freezes and deferrals. Several V10 firms had deferrals, of course, but those tended to be relatively short and, more importantly, well relatively compensated.

3. More bonuses. Not much of a factor outside of NYC, but still, in NYC this is a factor. The higher up you go, the more likely your firm is to match all the latest & greatest bonuses (the current round of spring bonuses being a prime example).

4. Better exit options. This has alreday been covered adequately.

There are obvious drawbacks in many cases, too.


There is some this response, but it is not wholly accurate.

1. I would agree that the work on the whole tends to be higher profile. V10s (and to a large degree firms well into the 20s) do get higher profile work, but it isn't primarily because of costs, it is based on relationships. Client relationships typically drive legal work. So "Investment Bank A" is going to use the "V10 Law Firm" for mergers because the individual bankers structuring the deal have used "V10 Law Firm" in the past know the M&A partners at "V10 Law Firm" and used them in the past (and trust that "V10 Law Firm" will get the job done correctly and on a very tight time frame the "Investment Bank A" is demanding). V50s typically don't have the contacts with the major investment banks/corporations to get the major work. However, plenty of non-headline work flows to the V50s from the very same "Investment Bank A" - just not the headline deals. The V50s may get the smaller M&A deals, but more likely those V50s have relationships with individuals that don't do headline type work (e.g., real estate, derivatives, bankruptcy). What most law school students don't realize is that the legal industry is a service industry that lives and dies by creating and maintaining relationships.

2. Agree that typically, V10s were very job secure. However, ITE has revealed that even the most profitable and prestigious firms aren't immune from layoffs (stealth or transparent). But as demand for legal services has slowed, the work has slowed less (and appears to returning more quickly) to the V10s. The V10s have always been big, profitable firms. It is only during the recent bubbles that the V50s-V100s have been able to close the gap in profitability and I would argue it was a result of the unprecedented demand for legal services during these bubbles.

3. More bonuses is not wholly accurate. Almost every V50 pays the same (with the exception of firms that base pay/bonuses purely on merit, e.g., Kirkland) and they pretty much match every bonus. However, many V20s and above do not have traditional "lockstep" bonus structures. Lockstep used to be the way firms paid - everyone in a particular class year got the exact same salary and bonus, regardless. There were no hour requirements to meet or discretion based on merit. However, in the past 5 years or so, many firms have changed to either a completely merit based system or a hybrid of lockstep/merit (with the most frequent system being lockstep based on meeting an hours requirement). At the V10s though, bonuses are still mostly lockstep and not tied to hours. So, if you're at a V10 you have comfort knowing that if the firm gives a bonus, you're going to get the bonus no matter what. At lockstep firms, you never really know what your bonus will be until you are told what it will be (e.g., what the hours requirement is and whether you hit the number, how merit discretion factors into your bonus, etc.).

4. Better exit opportunities is generally thought to be accurate, but not in the way that I presume most people on this board think. You don't necessarily have MORE opportunities, your just more likely to have more prestigious/better paying opportunities. Many associates go to clients of the firm (this is typically mid-level and senior associates that leave the firm). If you're firm has more prestigious/profitable clients, then those are the types of opportunities you will likely get. However, V50s mid-levels and seniors also go to clients, but their clients are often not the major investment banks/corporations. Another frequent route for mid-levels and seniors is to lateral to another firm (typically lower prestige). The more prestigious your initial firm, the more firms you can lateral into.

* * *

Something that hasn't been mentioned is that the V10s on the whole offer better "perks." We're talking subsidized gym memberships, subsidized cafeterias, better overtime meal/travel policies, more extravagant firm parties and summer programs (which for actual associates means being able to take summers out to better lunch spots/dinners). V10s are so profitable that they haven't cut as many of the perks that many V50s have had to do ITE in order to remain profitable. Yes, many V10s have cut some perks, but not to the same degree as the less profitable V50s.

Another poster mentioned client contact - this has nothing to do with the prestige of a firm. It really is more a function of how a firm views juniors. Some firms are quicker to trust juniors to get the job done, some aren't. I think the most important factor is that smaller groups tend to involve more client contact, larger groups don't. Most junior M&A associates or litigation associates aren't getting meaningful client contact. Contrast that to real estate or IP junior associates and you're more likely to get meaningful client contact. Its a function of a host of different factors - the size of the deal, the importance of the client, the staffing levels of the group, etc.

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IzziesGal
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Re: How are Elite law firms any better than non-Elite ones?

Postby IzziesGal » Tue Apr 05, 2011 8:45 pm

SOCRATiC wrote: Obviously, the more prestigious firms have higher PPP


This is not necessarily true. Check the AmLaw stats for highest PPPs. Some of the firms on there are V100s not V10s. I forget exactly how many.

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Re: How are Elite law firms any better than non-Elite ones?

Postby imchuckbass58 » Tue Apr 05, 2011 10:03 pm

IzziesGal wrote:
SOCRATiC wrote: Obviously, the more prestigious firms have higher PPP


This is not necessarily true. Check the AmLaw stats for highest PPPs. Some of the firms on there are V100s not V10s. I forget exactly how many.


Very true. Quinn has higher PPP than everyone except for Wachtell. Cahill has higher PPP than most V10s, and Milbank and Schulte are right in that area.

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Re: How are Elite law firms any better than non-Elite ones?

Postby alumniguy » Wed Apr 06, 2011 9:18 am

imchuckbass58 wrote:
IzziesGal wrote:
SOCRATiC wrote: Obviously, the more prestigious firms have higher PPP


This is not necessarily true. Check the AmLaw stats for highest PPPs. Some of the firms on there are V100s not V10s. I forget exactly how many.


Very true. Quinn has higher PPP than everyone except for Wachtell. Cahill has higher PPP than most V10s, and Milbank and Schulte are right in that area.



Again, as with USNews, Vault has rankings to sell subscriptions and ads. Quinn is top firm - it is primarily a lit firm, but any practicing attorney that knows anything about biglaw would include Quinn as a top rate firm (on par with many supposed V10s) - and no, I don't work at Quinn.

Cahill is considered very good at what it does - leveraged debt. The capital markets came back with a vengeance last year and that is why Cahill's profits have soared.

Milbank is a very good firm, not considered truly elite though (ala Fried Frank, Shearman and Wilkie). I think they probably think of themselves as peers, but I just don't think they get the quantity of really good work that traditional V10s get.

Schulte is primarily a NYC shop. It is profitable yes, but no one thinks it is on par with the V10s (let alone the other firms listed in this thread). They have a great PE practice and that is what they are known for.

One additional note is that PPP is a VERY misleading metric. A firm can affect its PPP in many ways - primarily by drastically limiting equity partnership ranks. There is more to prestige than PPP - especially to an associate!




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