Exit Options for Bankruptcy? Forum

[Anonymous User]

Graduating from a t13 law school and going into bankruptcy at Kirkland/Weil. What kind of exit options can I expect at years 2, 3, 4, etc.? Does making it to nonshare partner give you some good exit options? Do people mostly leave to do bankruptcy at other firms doing creditor work, or do people have opportunities to go in-house or even take on business roles? If I decide I don't like bankruptcy or can't hack it, can I retool myself as a corporate or litigation associate like by doing a clerkship or moving into a group like debt finance? What about becoming a bankruptcy judge? Finally, is most bankruptcy limited to New York? Seems like you either need to live there or be comfortable traveling to SDNY/Delaware all the time.

[carsondalywashere]

It seems most people will lateral to other law firms. I know in-house is not common but have seen it happen but it's usually because the person either had a business background or knew how to sell their skills (e.g. bankruptcy gives you generalist skills and gives you a understanding of the nuts and bolts of a business, etc.). Not sure about bankruptcy judge but I would guess partner level? I know a nonshare partner at my firm ended up leaving to become a chapter 7 trustee.

[Anonymous User]

As I get more senior in bankruptcy, I am realizing that exit options are what you make of them. There is no clearly-delineated path to an in-house position like there is in e.g., M&A. That said, you will interact with a lot of players in bankruptcy (banks, funds, PE, etc.), and the opportunities are there to distinguish yourself. Do a great job and they could try to bring you on board (I’ve seen it several times now).

Coming from KE/Weil you are going to be way ahead of the curve in terms of development. Stick it out for a few years and you can go anywhere and be well ahead of your peers.

In terms of geography, NYC is where 95% of the work is done. KE has a Chicago office which is at least equivalent to its NYC office, and Latham has Chicago and LA offices. Several firms also have Houston offices.

I’ve seen people switch groups within a firm to join the bankruptcy group, but not the other way around. I don’t think that has anything to do with the groups specifically, just that people that go into bankruptcy tend to be very into that area and not as interested in other groups. I’m sure you could switch out / lateral if you hate it though.

On the judge point, a counsel from Weil recently left to become a judge in Houston. I think this is going to be a very individualized thing though and not something I would count on.

[Anonymous User]

As I get more senior in bankruptcy, I am realizing that exit options are what you make of them. There is no clearly-delineated path to an in-house position like there is in e.g., M&A. That said, you will interact with a lot of players in bankruptcy (banks, funds, PE, etc.), and the opportunities are there to distinguish yourself. Do a great job and they could try to bring you on board (I’ve seen it several times now).

Coming from KE/Weil you are going to be way ahead of the curve in terms of development. Stick it out for a few years and you can go anywhere and be well ahead of your peers.

In terms of geography, NYC is where 95% of the work is done. KE has a Chicago office which is at least equivalent to its NYC office, and Latham has Chicago and LA offices. Several firms also have Houston offices.

I’ve seen people switch groups within a firm to join the bankruptcy group, but not the other way around. I don’t think that has anything to do with the groups specifically, just that people that go into bankruptcy tend to be very into that area and not as interested in other groups. I’m sure you could switch out / lateral if you hate it though.

On the judge point, a counsel from Weil recently left to become a judge in Houston. I think this is going to be a very individualized thing though and not something I would count on.

Interesting.

K&E and Weil are obviously the two best debtor shops, but my impression was that in terms of like, actual development the creditor work is going to be more valuable, especially if you're trying to move to a bank or fund? Summered in a creditor restructuring group and have friends in some of the major NY practices, unanimous consensus was that it's great to be the Partner at K&E or Weil but you're learning fuck all about bankruptcy litigation as a junior

Anon bc easily identifiable if you look at this + post history

[jarofsoup]

It’s less talked about but you could
maybe swing a restructuring shop like Alix or A&M after.

[Anonymous User]

As I get more senior in bankruptcy, I am realizing that exit options are what you make of them. There is no clearly-delineated path to an in-house position like there is in e.g., M&A. That said, you will interact with a lot of players in bankruptcy (banks, funds, PE, etc.), and the opportunities are there to distinguish yourself. Do a great job and they could try to bring you on board (I’ve seen it several times now).

Coming from KE/Weil you are going to be way ahead of the curve in terms of development. Stick it out for a few years and you can go anywhere and be well ahead of your peers.

In terms of geography, NYC is where 95% of the work is done. KE has a Chicago office which is at least equivalent to its NYC office, and Latham has Chicago and LA offices. Several firms also have Houston offices.

I’ve seen people switch groups within a firm to join the bankruptcy group, but not the other way around. I don’t think that has anything to do with the groups specifically, just that people that go into bankruptcy tend to be very into that area and not as interested in other groups. I’m sure you could switch out / lateral if you hate it though.

On the judge point, a counsel from Weil recently left to become a judge in Houston. I think this is going to be a very individualized thing though and not something I would count on.

Anon because I'm in KE/Weil bk

I've seen people leave the group to other practice groups within and without the firm. Obviously probably gets harder as time goes on, but seen mid-levels do it (to both corporate and litigation roles).

Not sure where the idea that debtor counsel's learn less (responding to other poster, not the quoted one above). You inevitably see the broadest range of issues. And, in my experience, I'm always far more junior than the person I'm interacting with.

[Anonymous User]

I’m the anon from above, I’m not sure where the idea that you will get better development at a creditor side place comes from. The sheer volume of work you will see at Weil/KE is substantially more than you will get at another firm, debtor or creditor, and you will develop accordingly. Besides, these firms do creditor side stuff too if it interests you.

On the FA exit options point, I’ve seen it happen at the associate level and a Sidley partner recently left to go start his own FA shop. I think this happens less often because it’s a less glamorous exit option, plus it seems pretty boring to me.

[Chardee_MacDennis]

It’s less talked about but you could
maybe swing a restructuring shop like Alix or A&M after.

This is possible and I’ve seen it happen, but you’ll probably work more hours/travel more at A&M or Alix than you would at K&E or Weil.

[Anonymous User]

The sheer volume of work you will see at Weil/KE is substantially more than you will get at another firm, debtor or creditor, and you will develop accordingly. Besides, these firms do creditor side stuff too if it interests you.

I have a few friends at major creditor shops (DPW, PW, Milbank, Akin) who lateraled from K&E/Weil debtor practices. They strongly feel that they get better development at the creditor shops because 1.) MUCH lower leverage (when's the last time a debtor side junior ran a call, you know? By contrast, my sense is it's very common at several of those shops to the person running a relatively significant portion of the matter by year 2/3), 2.) a ton of the junior work at K&E / Weil is debtor administration that's not really interesting (i.e. fee applications) but needs lots of hours and bodies 3.) you (moreso at K&E from what I've heard) very rapidly get silioed into a niche (e.g. ERISA, lease rejection, etc). I get the sense that this is conventional wisdom, too.

(More generally, more work doesn't necessarily mean more development! More good work means that, for sure, but my sense is that you're not getting the "good" work at K&E / Weil.)

Also -- are K&E / Weil serious creditor shops? I can't recall the last time I've seen them on a major creditor matter or even seriously discussed for a prominent ad hoc / fulcrum / UCC role. I'm sure they do it occasionally, but I've never heard of them beating out PW/DPW/Milbank/Akin for a rep.

Anon because easy to figure out who the friends are from posting history.

[Anonymous User]

The sheer volume of work you will see at Weil/KE is substantially more than you will get at another firm, debtor or creditor, and you will develop accordingly. Besides, these firms do creditor side stuff too if it interests you.

I have a few friends at major creditor shops (DPW, PW, Milbank, Akin) who lateraled from K&E/Weil debtor practices. They strongly feel that they get better development at the creditor shops because 1.) MUCH lower leverage (when's the last time a debtor side junior ran a call, you know? By contrast, my sense is it's very common at several of those shops to the person running a relatively significant portion of the matter by year 2/3), 2.) a ton of the junior work at K&E / Weil is debtor administration that's not really interesting (i.e. fee applications) but needs lots of hours and bodies 3.) you (moreso at K&E from what I've heard) very rapidly get silioed into a niche (e.g. ERISA, lease rejection, etc). I get the sense that this is conventional wisdom, too.

(More generally, more work doesn't necessarily mean more development! More good work means that, for sure, but my sense is that you're not getting the "good" work at K&E / Weil.)

Also -- are K&E / Weil serious creditor shops? I can't recall the last time I've seen them on a major creditor matter or even seriously discussed for a prominent ad hoc / fulcrum / UCC role. I'm sure they do it occasionally, but I've never heard of them beating out PW/DPW/Milbank/Akin for a rep.

Anon because easy to figure out who the friends are from posting history.

This gets repeated a lot, that debtor work is all non-substantive administrative work, and I’m not sure why. There is some administrative work that needs to get done that and, frankly, it’s not bad to see and do once or twice (committees do fee apps too). The benefit of being at Weil/KE is the huge volume which means you’ll get the opportunity to work on different aspects of cases over time, there is no “siloing” case you case.

I was at one of these firms and was running calls regularly as a second year. I know people that have run matters as 3rd-4th years. This obviously doesn’t happen on e.g., Sears, but the opportunities are there if you’re capable.

Also, creditor work isn’t just committee work (which honesty sounds awful), Weil and KE haven’t done committee work recently but they do do creditor work.

[Anonymous User]

The sheer volume of work you will see at Weil/KE is substantially more than you will get at another firm, debtor or creditor, and you will develop accordingly. Besides, these firms do creditor side stuff too if it interests you.

I have a few friends at major creditor shops (DPW, PW, Milbank, Akin) who lateraled from K&E/Weil debtor practices. They strongly feel that they get better development at the creditor shops because 1.) MUCH lower leverage (when's the last time a debtor side junior ran a call, you know? By contrast, my sense is it's very common at several of those shops to the person running a relatively significant portion of the matter by year 2/3), 2.) a ton of the junior work at K&E / Weil is debtor administration that's not really interesting (i.e. fee applications) but needs lots of hours and bodies 3.) you (moreso at K&E from what I've heard) very rapidly get silioed into a niche (e.g. ERISA, lease rejection, etc). I get the sense that this is conventional wisdom, too.

(More generally, more work doesn't necessarily mean more development! More good work means that, for sure, but my sense is that you're not getting the "good" work at K&E / Weil.)

Also -- are K&E / Weil serious creditor shops? I can't recall the last time I've seen them on a major creditor matter or even seriously discussed for a prominent ad hoc / fulcrum / UCC role. I'm sure they do it occasionally, but I've never heard of them beating out PW/DPW/Milbank/Akin for a rep.

Anon because easy to figure out who the friends are from posting history.

I’m at K&E/Weil. This first paragraph is so hilariously incorrect, I don’t even know where to begin.

1. On all the matters I’ve been on, I’ve NEVER heard a junior from the creditors running a call, much less being involved. Maybe certain calls on things that don’t matter on a case, but on a serious call on real issues, not at all. As a 2-3 year, I was running workstreams and calls with the other side, and negotiating with more senior attorneys (albeit on things that didn’t really matter, but you have to prove yourself somehow). I’m not sure where this info is coming from, but your sense is wrong. In my experience, it’s the opposite—I rarely interact with anyone on the creditor side below like year 5-6.

2. True to an extent, but there’s admin work everywhere. Not sure what sort of “substantive” work you think juniors should get, but there’s a progression, and yes, juniors get the short end of fee review/etc..., but if you can’t handle small tasks, why am I going to trust you on the DIP? I’ve also been on a few creditor matters—you’re doing essentially the same stuff, just from the other side.

3. I don’t even know what this means, getting siloed? Sure, you may find yourself on the same workstream on more than one matter, but there’s so much work, you get a variety of experiences, and you can always ask to be on something else (like, we don’t have 1-2 associates who do ONLY lease rejection). At least where I am, we involve specialists (tax, ERISA, debt finance, etc....), so, again, not even sure what this means.

K&E/Weil dominate debtor-side work (which is more profitable), so it makes sense that creditor-side work isn’t as big of their work flow as the other shops. Also, committee work sucks. Unless there’s no actual deal (e.g., Sears, Toys), you walk into a situation where the deal’s already been cut, fight for a few extra pennies for GUCs, get to a deal, and then you disappear for the rest of the case.

[carsondalywashere]

I’m the anon from above, I’m not sure where the idea that you will get better development at a creditor side place comes from. The sheer volume of work you will see at Weil/KE is substantially more than you will get at another firm, debtor or creditor, and you will develop accordingly. Besides, these firms do creditor side stuff too if it interests you.

On the FA exit options point, I’ve seen it happen at the associate level and a Sidley partner recently left to go start his own FA shop. I think this happens less often because it’s a less glamorous exit option, plus it seems pretty boring to me.

This is a stupid question but by FA do you mean financial advising?

[Anonymous User]

For those wanting to go creditor side - I would be wary about whom exactly your clients will be.

If you are repping banks, generally fine but I would be careful joining a place if the practice does a significant amount of representing distressed debt funds/special situations funds. I am of the opinion that you never want to be in the position that your client is more sophisticated than you because you don’t get to provide any commercial-like advice and are really just executing.

My company engages Davis Polk quite a bit for our debt restructurings and all we tend to send is execution and last minute filings. Not on purpose but just the nature of the work.

[Anonymous User]

Midlevel. Have worked at two of the creditor shops named so far in the thread.

90% of your exit opportunities from any of these places will be other law firms. KE/Weil has mild advantage for FA. Certain creditor shops have stronger pipeline, usually through secondments, to asset managers that play with distressed debt.

At a debtor-focused shop, the bulk of your expertise will be in-court bankruptcy and whatever out-of-court or sponsor deals you can pick up. You will know some finance, but not as well as finance folks. You will be more comfortable with litigation-y type situations, but not as much as the litigators, and so on. At a creditor shop, you're more likely to find yourself in out-of-court situations, which can broaden your scope to include some securities/more finance. But what you lose at a creditor shop is the repetition you would get at a place like Kirkland/Weil, where the debtor pipeline ensures that you're hammering down essential bankruptcy skills over and over again (assuming you can mix up your matters beyond prepacks). Creditor/sponsor representations can be more bespoke. So you need to ask yourself, who might be willing to pay me for my in-court bankruptcy skill set? Usually other law firms.

It's easier to "run calls" as a K&E or Weil junior because there's a lot of lower level process/documents, the substance is more intuitive and the clients are generally clueless. Flatter leverage at a creditor shop is completely offset by the steeper finance learning curve and more sophisticated clients. At my firm, it doesn't matter if you're a 1st or 3rd year. If you don't have a working knowledge of finance, then you're going to remain the silent junior for most calls.

[Anonymous User]

For those wanting to go creditor side - I would be wary about whom exactly your clients will be.

If you are repping banks, generally fine but I would be careful joining a place if the practice does a significant amount of representing distressed debt funds/special situations funds. I am of the opinion that you never want to be in the position that your client is more sophisticated than you because you don’t get to provide any commercial-like advice and are really just executing.

My company engages Davis Polk quite a bit for our debt restructurings and all we tend to send is execution and last minute filings. Not on purpose but just the nature of the work.

Co-signed

[Anonymous User]

Midlevel. Have worked at two of the creditor shops named so far in the thread.

90% of your exit opportunities from any of these places will be other law firms. KE/Weil has mild advantage for FA. Certain creditor shops have stronger pipeline, usually through secondments, to asset managers that play with distressed debt.

At a debtor-focused shop, the bulk of your expertise will be in-court bankruptcy and whatever out-of-court or sponsor deals you can pick up. You will know some finance, but not as well as finance folks. You will be more comfortable with litigation-y type situations, but not as much as the litigators, and so on. At a creditor shop, you're more likely to find yourself in out-of-court situations, which can broaden your scope to include some securities/more finance. But what you lose at a creditor shop is the repetition you would get at a place like Kirkland/Weil, where the debtor pipeline ensures that you're hammering down essential bankruptcy skills over and over again (assuming you can mix up your matters beyond prepacks). Creditor/sponsor representations can be more bespoke. So you need to ask yourself, who might be willing to pay me for my in-court bankruptcy skill set? Usually other law firms.

It's easier to "run calls" as a K&E or Weil junior because there's a lot of lower level process/documents, the substance is more intuitive and the clients are generally clueless. Flatter leverage at a creditor shop is completely offset by the steeper finance learning curve and more sophisticated clients. At my firm, it doesn't matter if you're a 1st or 3rd year. If you don't have a working knowledge of finance, then you're going to remain the silent junior for most calls.

KE/Weil associate here. Why do you think creditor-side does more out-of-court work? Every out-of-court and in-court deal starts the same, trying to do something out of court. And, the Company is going to need someone to represent them.

I mean maybe it is right, I'm just not following the rationale. I've done some out-of-court deals, but no idea what the percentage looks like compared to my peers at creditor firms.