Perfect your positioning and nurture your network
Anne Cruikshank, founder of corporate law and governance boutique Arinna Law, has over a decade of experience of setting up and running her own businesses, even though Arinna itself is less than a year old in its current form.
In this series of blogs we are looking at the motivators, success factors and pitfalls for start-up boutique law firms and Anne’s story is a great exemplar. Just as the Covid-19-induced social and economic turmoil is likely to generate a crop of start-ups over the coming months, the economic crisis of 2008/9 was the starting point for Anne.
Be clear about what you want – and what you don’t
Made redundant from her legal role at AIG in 2009, as a result of the closure of the investment bank, she wasn’t looking to set up her own firm initially but she was clear about the sort of work she wanted to do, which was working on deals and structuring new businesses. And she was equally clear that she didn’t want to take on a general counsel role in a large corporate, or return to life at a Magic Circle firm.
Considering what energised her to set up her own business, she says “I was keen to do something more entrepreneurial – the world of start-ups was very appealing after being in a huge financial services group like AIG: control of my own life is something that I have come to focus on more and more in the last few years.”
Thanks to her extensive network, various opportunities for corporate work on entrepreneurial ventures came her way and she initially set up a business as a consultant, rather than a law firm. Her early days demonstrated the importance of being opportunistic and flexible, she says, as she worked with contacts from the financial services sector who were often also striking out on their own.
Be entrepreneurial
Other network contacts led her to a number of significant roles on restructuring projects for GE Capital and HSBC. Her clients value her legal and industry experience, and willingness to work flexibly in a way, she says, that most large law firms aren’t set up to do: “It’s hard for larger firms to be entrepreneurial or to adapt to different ways that clients might want to work. They have their rack rates and hosts of junior lawyers to charge out, and they need to accommodate that. As a boutique firm, I’m able to provide a ‘proper adult conversation’ and adapt to what they need.”
Re-evaluating Arinna’s market position
Changes in the regulations governing law firms in November 2019 prompted Anne to review her business and its positioning in the market. By 2019, boutique law firms were an established feature of the London legal market and she was keen to take further advantage of that trend with a higher-profile presence.
Transitioning her business to become Arinna Law gave Anne a chance to review how she wanted to be positioned in the market; in other words, what she ‘wanted to be famous for’. “I feel it’s incredibly important to be clear about your proposition if you are a boutique firm,” say says. “Much of my work comes from referrals from other law firms, so they need to feel confident that I’m not in competition with them.
“I have also built my proposition around an ability to work collaboratively with other niche firms, to provide them with corporate law support, which I can do either behind the scenes as part of their team or via referrals. This helps them provide a more comprehensive service to their clients while knowing that their core client relationships are protected. Equally these firms know that if my clients need employment, property, tax or disputes expertise, I have relationships with them as trusted firms to work with in those areas.”
At RCR, we think about positioning in terms of four elements: product (what your clients are buying), market (who you’re aiming at), service (the style in which you deliver your product) and price or value.
In relaunching Arinna, Anne built the firm’s product position around its expertise in smaller corporate deals, governance issues, and its ‘part-time GC’ service for smaller businesses. While being focussed is important, Anne does stress that “you don’t want to be so niche that clients only need your advice every 10 years!”, and she’s also kept it flexible in not specialising in any particular market sector.
When it comes to pricing, she says her clients tend to value her flexibility rather than questioning her fee rates. “I don’t sell on price but on efficiency and value”, she says.
Tips and pitfalls
For those considering setting up their own firm, her top tips are to develop a really clear position, and to nurture your network. “I go to lots of events because you never know who you’ll meet or where a referral will come from”. While real world networking has been on hold during lockdown, Zoom coffees and drinks have come in useful, and Arinna has continued to see a steady stream of client referrals.
Her key advice on pitfalls to avoid is to “be very clear around the regulatory requirements of setting up your own firm: I’ve spent far more time than I imagined on compliance with anti-money laundering regulations.”
Considering the economic uncertainty ahead, Anne is optimistic about the prospects for Arinna and for other boutique firms: “Niche firms can be flexible, and there are still going to be plenty of opportunities for those who are entrepreneurial, either on the client side, or among their legal advisers.” Anne foresees that there will be transactional opportunities brought about by a shake-out in the market, and through working with nimble, smaller PE firms and distressed investors. With regard to the part-time GC element of her business, she again believes that Arinna’s flexibility will be key at a time when businesses may be reluctant to take on additional staff, while still needing to respond quickly.