Wavelength: Simmons’ managing partner Jeremy Hoyland discusses the hows, whats and whys of the acquisition
Legal engineering firm Wavelength was yesterday (23 July) acquired by Simmons & Simmons in what we dubbed “one of the latest, albeit one of the more dramatic, developments as law firms focus on building or buying their own alternative delivery capability.”
In this candid interview with Legal IT Insider, Simmons’ managing partner Jeremy Hoyland tells us how the acquisition came about, and perhaps more importantly, why.
Jeremy, how did the acquisition of Wavelength come about?
We started working with them about a year ago. The client feedback was good and the feedback from our partners was good. We got them to come out to our partner conference in Prague and help our education process in terms of the use of technology on legal projects and we got engagement from as many partners as we could. Then we started to talk about how we could work more frequently and closely together and that led to a conversation about Wavelength becoming a part of the firm.
What are the key reasons you acquired the company?
It’s quite apparent that the market needs to change and change faster than law firms are conforming to, and we were under pressure to deliver more rapid change, in particular in the application of technology to data. We are all drowning in data when it comes to transactions, especially the big projects, and that is a big factor. We saw and we see an opportunity to add a skillset to the ones we already have and to extend our range of services and advise clients on the legal engineering side but perhaps more importantly, to deliver a better service than our competitors on those largest transactions. It’s really that second bit that’s really exciting for us because I do think there’s a need for this skillset and our client are keen to see firms deliver that and better quality tech products and I think we have a better offering than our peers. Also, there is a brand factor at play here. Our brand will help Wavelength to access panels and educate clients on what they can do. But Wavelength will also help us in market perception as a forward-thinking firm that really gets it.
Is it fair or unfair to say that Simmons is behind the curve in terms of its ‘alternative’ or tech-led offering to clients?
I do think that’s unfair. Lots of firms are in a similar position in terms of dabbling and trying different software solutions and we’ve done that at least as much as anyone else and Ben [McGuire] and his team have done a good job of looking at different solutions. The truth is that our firm is quite different in that we have a larger contentious and regulatory practice, heavy with funds work, and less so with M&A, so some of our M&A-focussed competitors are probably more keen to invest in technology focussed on that area.
The nature of what we’ve been focusing on is different. We’ve done a lot with online products – subscription products for funds and banks, for example in the way we deliver advice on Brexit. If you look at the FT innovation reports, in the last couple of years we’ve had the young legal innovator and European innovator, and Charlotte Stalin won an award before that, so in terms of individuals, we have people who are recognised as leaders. We have been traditionally seen as quite an innovative firm but we’re probably less interested and more skeptical about AI and what it can do – we have a big eDiscovery business in which we work closely with Relativity, which has been doing some of the things firms are now shouting about for a long time.
How will the acquisition be structured?
The current thinking is that it will be external, so client-facing, but I’m sure Wavelength will look at some of the things we do internally and say, ‘why do you do it like that?!’ Some of the ways we deliver internal processes may change, which will be great, but I see them being out in the market with our clients, pitching for big projects as to how they manage their data more efficiently. Legal teams’ budgets are under pressure and around the time we announced the acquisition I had an email from one of the big banks saying ‘We’re under pressure to do things differently, we need to change, can Simmons help us?’ It was bang on point.
What exactly is it that you have bought? Is it people, rather than tech?
Wavelength has around 30 people and if you subscribe to the view that I proposed in terms of the high-end legal market, then all of our competitors need legal engineering skills, so they either need to build or grow. I know 30 is not a huge number, but there are data scientists among them, and if I go out to recruit a data scientist imagine how that will go. [Founders] Peter and Drew have proved their ability to bring a team that is high quality and committed and doing some really interesting things, and that brings us capability internally. It will ultimately change how we approach projects internally.
Was it a cash acquisition or more complex?
Wavelength is a fairly young company and it wasn’t complicated. It was a straightforward acquisition. Peter and Drew are already partners at the firm.
How will it be managed logistically?
Wavelength is split between Cambridge and London. London will move into our building here and Cambridge will become Simmons’ Cambridge office.
You have Simmons Adaptive, which is your flexible resource offering. Will Wavelength be wrapped up as part of your alternative offering?
Yes absolutely. We have a subsidiary called Solutions where we house all our non-law firm business. Adaptive is quite significant for us now. Solutions will also house Wavelength and our eDiscovery business, which is also a significant business for us.
We are looking to develop new products especially through our online subscription service Navigator, which will be based in there. So, we’re building a solutions business which will sit in CityPoint. We’ll house Ben and the team next to Adaptive, which will be next to our eDiscovery business. Hopefully it will feel more aligned to the start-up culture that Wavelength is used to.
Just to be completely clear, is Solutions an entirely separate legal entity?
Yes, we’ve had it for around a year now. Having a separate business means that you can invest under the same umbrella but it’s not integrated from a finance perspective, which is helpful.
Comment: We have been closely trailing law firm efforts to build up their alternative legal services capability and among UK headquartered law firms, it is still rare for them to launch entirely separate ventures – culturally the barriers are still high. Allen & Overy has led the charge – for years delivering subscription-based derivatives advice and more through Aosphere and latterly Margin Matrix. Clifford Chance more recently launched its subscription-based products venture Applied Solutions, which is being run out of New York by former Thomson Reuters Practical Law Company CEO Jeroen Plink.
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