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Kirkland just took another top M&A partner from Cravath (Eric Scheile). Just took top funds lawyer and head of corporate from Debevoise. This seems exciting, but it also begs the question of what happens when the economy isn't as good?

The thing about KE is that it is well hedged with the restructuring practice in case of a bad economy. It can carry the firm, and from what I know it really is a firmwide effort that everyone pitches in on.

Just in my personal opinion, I don't think bringing in talent is ever a bad thing. Everyone goes through downturns, might as well have the best people you can find right?

Anonymous User wrote:Kirkland just took another top M&A partner from Cravath (Eric Scheile). Just took top funds lawyer and head of corporate from Debevoise. This seems exciting, but it also begs the question of what happens when the economy isn't as good?

PE work tends to be active in both bear and bull markets so I wouldn't worry too much about about the stability of the firm.

Anonymous User wrote:Kirkland just took another top M&A partner from Cravath (Eric Scheile). Just took top funds lawyer and head of corporate from Debevoise. This seems exciting, but it also begs the question of what happens when the economy isn't as good?

When the economy isn't good, K&E will likely do what every other firm does: fire associates. This will happen regardless of whether certain partners are poached or not.

PMan99 wrote:

Anonymous User wrote:Kirkland just took another top M&A partner from Cravath (Eric Scheile). Just took top funds lawyer and head of corporate from Debevoise. This seems exciting, but it also begs the question of what happens when the economy isn't as good?

When the economy isn't good, K&E will likely do what every other firm does: fire associates. This will happen regardless of whether certain partners are poached or not.

And if you poach the right people, it will lessen the need to fire associates. The problems occur when growth is in practices areas that are "in a bubble" or when the laterals really don't bring in work like they promised.

Why tf is this anon.

The only thing that would worry me is what KE is promising these guys to being them in. Dewey showed how quick overpromising outside talent can blow up.

1styearlateral wrote:Why tf is this anon.

The sacrecy of anon shall not be challenged!

Disappointed that a forum of lawyers has yet to ridicule the bastardization of the phrase “begs the question” by OP

BayCat24 wrote:Disappointed that a forum of lawyers has yet to ridicule the bastardization of the phrase “begs the question” by OP

Think of it this way, you got to be the first!

Secondly, Kirkland will toss your keester in restructuring to make up your hours during a recession. It's a relatively better place to go through a recession than a lot of other firms.

This isn't new at all and it has been K&E's model for at least as long as i've been paying attention. They poach partners en masse with enticing short term (2 years is what i've most commonly heard) compensation guarantees and the understanding that after that it's back to eat what you kill and many/most of the poached partners thereafter end up either not making equity partner or getting de-equitized (I'm not sure whether they get equity up front or just a fat signing bonus) and moving on to do something else unless they are bringing in sufficient business to justify their sticking around.

It has worked extremely well for them and from an outsider's POV seems somewhat protected from cycles by virtue of the massive number of non-equity partners who are great revenue generators in good times and easily disposable in bad times. Separately, as mentioned above PE is among the more recession proof specialties and their bankruptcy practice is both top tier and counter cyclical. Very well positioned firm but it has put itself there with an exaggerated "sink or swim" culture that really really isn't for everyone.