Why are litigation practices less profitable than corporate ones? Forum

[gaddockteeg]

I've heard it often repeated, both here and IRL that litigation practices are less profitable for firms than corporate firms.

Why is this so?

[1styearlateral]

Shot in the dark, but I think it's because there's usually less at stake. Also, companies aren't going to court like the used to. Almost everything ends pre-trial/in the discovery phase (which can be costly in itself).

Don't forget those guys who do med mal cases on contingency. They bring in the big bucks.

[Tiny Rick!]

Nobody wants to be in litigation. And there are very few "bet the company" cases so prices get negotiated down heavily and there is just less demand for litigation services at the level big firms charge.

On the other side, think about the purchase prices of corporate transactions. In a $3 billion transaction, do you really think anyone gives a fuck about a $500k - $1 million legal bill? Especially when the bankers are charging three to five times that much? Might as well get the best firm to dot your lower case j's. And there is a very high demand for these legal services when the economy is humming.

[Anonymous User]

Shot in the dark, but I think it's because there's usually less at stake. Also, companies aren't going to court like the used to. Almost everything ends pre-trial/in the discovery phase (which can be costly in itself).

Don't forget those guys who do med mal cases on contingency. They bring in the big bucks.

I wouldn't necessarily agree that there is less at stake. There is often the exact same at stake. (i.e. bet the company)
(I know what you mean, though, so I'm probably being somewhat semantical)

Often times, litigation generates business from cleaning the mess that's left when corporate doesn't do their job very well. Broadly speaking, it all starts with corporate. Then, if things get messy or go awry, things go to litigation. But when things go well, litigators go hungry.

[Itiswritten]

Shot in the dark, but I think it's because there's usually less at stake. Also, companies aren't going to court like the used to. Almost everything ends pre-trial/in the discovery phase (which can be costly in itself).

Don't forget those guys who do med mal cases on contingency. They bring in the big bucks.

I wouldn't necessarily agree that there is less at stake. There is often the exact same at stake. (i.e. bet the company)
(I know what you mean, though, so I'm probably being somewhat semantical)

Often times, litigation generates business from cleaning the mess that's left when corporate doesn't do their job very well. Broadly speaking, it all starts with corporate. Then, if things get messy or go awry, things go to litigation. But when things go well, litigators go hungry.

Accidentally clicked the anon button. My B. But also, think about the fact that many agreements now have mediation/arbitration provisions and nearly all cases settle. No one wants to go to court unless its the only option on the table.

[Anonymous User]

I get billed out at higher rates (about 20% higher) when the matter involves underwriter-side corporate work

[jarofsoup]

Litigation is much more feast or famine. Corp from my experience is just a wall of never ending work.

Also there is a lot of different types of "corp" work. Cap Markets, Finance, Funds, Reg, etc.

[dixiecupdrinking]

Don't firms sometimes get paid based on a percentage of the deal for corporate work? I could be off base but always thought that was part of the reason they can be lucrative.

In any event, I agree that litigation is rarely something a client wants to be involved in in the first place, and so there is more pressure to keep costs down.

[Lacepiece23]

Litigation is much more feast or famine. Corp from my experience is just a wall of never ending work.

Also there is a lot of different types of "corp" work. Cap Markets, Finance, Funds, Reg, etc.

What? Litigation is never going anywhere even it's less profitable than it once was. People will always find reason to sue each other. Corporate work is gloried paralegal work that disappears when the economy is in a recession. Remember 2008?

[Abbie Doobie]

Litigation is much more feast or famine. Corp from my experience is just a wall of never ending work.

Also there is a lot of different types of "corp" work. Cap Markets, Finance, Funds, Reg, etc.

What? Litigation is never going anywhere even it's less profitable than it once was. People will always find reason to sue each other. Corporate work is gloried paralegal work that disappears when the economy is in a recession. Remember 2008?

yeah but finding some typos in a proxy statement is the quickest way to superstar

[nealric]

Litigation is much more feast or famine. Corp from my experience is just a wall of never ending work.

Also there is a lot of different types of "corp" work. Cap Markets, Finance, Funds, Reg, etc.

Corporate work is gloried paralegal work that disappears when the economy is in a recession. Remember 2008?

At the junior associate level perhaps. But a good corporate attorney has to anticipate issues that might come up over the course of the deal, and will be a trusted adviser to the principals. Yes, Corporate work does die down when business deals are not happening at the same rate. It tends to be profitable simply because deal-flow tends to be fairly regular, especially for clients like investment banks. Also, the legal fees often pale in comparison to the amounts being transacted- $10 million in legal fees doesn't really register in a $10 billion deal.

As for why litigation is becoming less profitable for biglaw: I think a big reason is that litigation has become so expensive that most institutional clients avoid fully litigating cases wherever possible. Things tend to settle fairly early over the course of the dispute. Another reason is that institutional clients no longer just send their entire litigation docket to a single trusted firm (or handful of trusted firms)- things tend to get farmed out all over the place. Biglaw only gets the very small handful of megacases that come up.

[stoopkid13]

Don't firms sometimes get paid based on a percentage of the deal for corporate work? I could be off base but always thought that was part of the reason they can be lucrative.

My understanding is that this is true for banks, but firms still charge by the hour for corporate work (I also want to say Wachtell may be an exception because their associates basically do IB work too). This explains why banks make much more money than law firms, because as deals have grown larger, bank compensation has grown faster than law firm compensation. I don't think it explains the gap between lit and corp within law firms.

[lolwat]

Also, the legal fees often pale in comparison to the amounts being transacted- $10 million in legal fees doesn't really register in a $10 billion deal.

I have no clue how billing for corporate transactions works, but I think something like the above might be a big part of the reason. On the litigation side, I keep hearing stories about how GCs don't want to pay for work done by first year attorneys, who nickel and dime every part of every bill, set caps on how much you can bill for legal research or meetings/conferences. Basically doing everything in their power to minimize costs when it comes to fees its paying attorneys to litigate cases. (To be fair, some of this is because firms tend to overbill on meetings and such. But other times it's the company being cheap.) This is also probably also why a lot of litigation work gets shipped off to boutiques that often promise flexible billing (not always hourly), fewer attorneys on cases, etc.

Basically, it's very likely that companies don't mind if you pile on as many associates as humanly possible on a $10 billion deal (hence generating a huge stream of income for the firm), but they will nickle and dime you on every little thing when defending a case. The potential damages in litigation also matters a lot -- who wants to spend $2 million defending a case where the potential judgment might be $3 million? It's gotta be something like Apple v Samsung before a company lets you throw 100 attorneys at the case.

[legalese_retard]

There is way more competition for litigation work than for corporate work, which lowers the billable rates charged for litigators. Corporate clients are more willing to move their litigation matters to mid-sized firms and small "litigation boutiques" because they can charge less than their big law counterparts. These shops are way more efficient with expenses and don't need a lot of the big Law Resources used in the transactional practice. Litigation firms only really need online legal research tools and a small support staff to manage the firm. If they take on a larger case, there are plenty of contract attorneys available to work on short-term doc review projects and legal research. Additionally, a lot of the attorneys at these litigation firms are former big law attorneys or have the same (or better) credentials than their big law counterparts.

[Lacepiece23]

There is way more competition for litigation work than for corporate work, which lowers the billable rates charged for litigators. Corporate clients are more willing to move their litigation matters to mid-sized firms and small "litigation boutiques" because they can charge less than their big law counterparts. These shops are way more efficient with expenses and don't need a lot of the big law resources used in the transactional practice. Litigation firms only really need online legal research tools and a small support staff to manage the firm. If they take on a larger case, there are plenty of contract attorneys available to work on short-term doc review projects and legal research. Additionally, a lot of the attorneys at these litigation firms are former big law attorneys or have the same (or better) credentials than their big law counterparts.

This is the right answer.

[nealric]

Also, the legal fees often pale in comparison to the amounts being transacted- $10 million in legal fees doesn't really register in a $10 billion deal.

I have no clue how billing for corporate transactions works, but I think something like the above might be a big part of the reason. On the litigation side, I keep hearing stories about how GCs don't want to pay for work done by first year attorneys, who nickel and dime every part of every bill, set caps on how much you can bill for legal research or meetings/conferences. Basically doing everything in their power to minimize costs when it comes to fees its paying attorneys to litigate cases. (To be fair, some of this is because firms tend to overbill on meetings and such. But other times it's the company being cheap.) This is also probably also why a lot of litigation work gets shipped off to boutiques that often promise flexible billing (not always hourly), fewer attorneys on cases, etc.

Basically, it's very likely that companies don't mind if you pile on as many associates as humanly possible on a $10 billion deal (hence generating a huge stream of income for the firm), but they will nickle and dime you on every little thing when defending a case. The potential damages in litigation also matters a lot -- who wants to spend $2 million defending a case where the potential judgment might be $3 million? It's gotta be something like Apple v Samsung before a company lets you throw 100 attorneys at the case.

Side point on not wanting to pay for first year associates: In many cases, it's not that clients aren't willing to pay for junior associates per-se. I'd rather a junior associate do the more labor intensive but lower skill work on my matters. Rather, clients tend to object to first years being used as a way to inflate partner billing rates. For example, the junior is on every single call with the partner to "take notes" or gets assigned to research questions the partner already knows the answer to off the top of her head.

I'd also say the need for vast amounts of manpower is a good reason why corporate can be so profitable. Putting together a big deal takes a lot of labor just to paper properly (let alone negotiate). There's really no way around having dozens of lawyers work on the largest deals. By contrast, setting aside document review (which can be outsourced), litigation matters with even a very large amount in controversy can often be handled by a small team.

[LaLiLuLeLo]

Also, the legal fees often pale in comparison to the amounts being transacted- $10 million in legal fees doesn't really register in a $10 billion deal.

I have no clue how billing for corporate transactions works, but I think something like the above might be a big part of the reason. On the litigation side, I keep hearing stories about how GCs don't want to pay for work done by first year attorneys, who nickel and dime every part of every bill, set caps on how much you can bill for legal research or meetings/conferences. Basically doing everything in their power to minimize costs when it comes to fees its paying attorneys to litigate cases. (To be fair, some of this is because firms tend to overbill on meetings and such. But other times it's the company being cheap.) This is also probably also why a lot of litigation work gets shipped off to boutiques that often promise flexible billing (not always hourly), fewer attorneys on cases, etc.

Basically, it's very likely that companies don't mind if you pile on as many associates as humanly possible on a $10 billion deal (hence generating a huge stream of income for the firm), but they will nickle and dime you on every little thing when defending a case. The potential damages in litigation also matters a lot -- who wants to spend $2 million defending a case where the potential judgment might be $3 million? It's gotta be something like Apple v Samsung before a company lets you throw 100 attorneys at the case.

Side point on not wanting to pay for first year associates: In many cases, it's not that clients aren't willing to pay for junior associates per-se. I'd rather a junior associate do the more labor intensive but lower skill work on my matters. Rather, clients tend to object to first years being used as a way to inflate partner billing rates. For example, the junior is on every single call with the partner to "take notes" or gets assigned to research questions the partner already knows the answer to off the top of her head.

I'm not a litigator, but my first year lit friends constantly complain because they're not staffed on some really cool cases because the client has an explicit "NO FIRST YEARS" clause in their fee letters/engagements/etc. These are very large companies in a variety of industries. Seems kinda silly to me because now you're just paying more senior, more expensive attorneys to do grunt work, but there you have it. It makes more sense to me to allow first years and then just negotiate the bill, but I'm not the GC of some big public company.

[1styearlateral]

Also, the legal fees often pale in comparison to the amounts being transacted- $10 million in legal fees doesn't really register in a $10 billion deal.

I have no clue how billing for corporate transactions works, but I think something like the above might be a big part of the reason. On the litigation side, I keep hearing stories about how GCs don't want to pay for work done by first year attorneys, who nickel and dime every part of every bill, set caps on how much you can bill for legal research or meetings/conferences. Basically doing everything in their power to minimize costs when it comes to fees its paying attorneys to litigate cases. (To be fair, some of this is because firms tend to overbill on meetings and such. But other times it's the company being cheap.) This is also probably also why a lot of litigation work gets shipped off to boutiques that often promise flexible billing (not always hourly), fewer attorneys on cases, etc.

Basically, it's very likely that companies don't mind if you pile on as many associates as humanly possible on a $10 billion deal (hence generating a huge stream of income for the firm), but they will nickle and dime you on every little thing when defending a case. The potential damages in litigation also matters a lot -- who wants to spend $2 million defending a case where the potential judgment might be $3 million? It's gotta be something like Apple v Samsung before a company lets you throw 100 attorneys at the case.

Side point on not wanting to pay for first year associates: In many cases, it's not that clients aren't willing to pay for junior associates per-se. I'd rather a junior associate do the more labor intensive but lower skill work on my matters. Rather, clients tend to object to first years being used as a way to inflate partner billing rates. For example, the junior is on every single call with the partner to "take notes" or gets assigned to research questions the partner already knows the answer to off the top of her head.

I'm not a litigator, but my first year lit friends constantly complain because they're not staffed on some really cool cases because the client has an explicit "NO FIRST YEARS" clause in their fee letters/engagements/etc. These are very large companies in a variety of industries. Seems kinda silly to me because now you're just paying more senior, more expensive attorneys to do grunt work, but there you have it. It makes more sense to me to allow first years and then just negotiate the bill, but I'm not the GC of some big public company.

Clients don't want to pay for a newly-minted attorney to learn how to lawyer. At my firm, some of our bigger clients only authorize certain attorneys to work on their matters because they've already been vetted.

[Arad]

In a $3 billion transaction, do you really think anyone gives a fuck about a $500k - $1 million legal bill? Especially when the bankers are charging three to five times that much? Might as well get the best firm to dot your lower case j's. And there is a very high demand for these legal services when the economy is humming.

Ditto. But, deal fees for a $3B transaction would be significantly more than the numbers you provided.

[Anonymous User]

Don't firms sometimes get paid based on a percentage of the deal for corporate work? I could be off base but always thought that was part of the reason they can be lucrative.

My understanding is that this is true for banks, but firms still charge by the hour for corporate work (I also want to say Wachtell may be an exception because their associates basically do IB work too). This explains why banks make much more money than law firms, because as deals have grown larger, bank compensation has grown faster than law firm compensation. I don't think it explains the gap between lit and corp within law firms.

In part this is true (former M&A IBanker here). But the main reason M&A firms who advise on the deal from the IB side charge so much more is b/c they often, though not always, don't get paid unless the deal closes, and not all deals close. They take a huge up front risk at only a engagement fee/retainer or none at all for the pay-day on the back-end. Conversely, law firms get paid, most of the time, regardless of if the deal happens or not, it's just a question of the magnitude of their bill.

So, for instance from my pre-law IBanking work, I might work on 10 different transactions in a year, say the firm charges a 8% fee on the purchase price when sold (we would do sell side mostly). Maybe 5 of those deals don't happen for whatever reason (financials, bad timing, shareholder dispute, etc) and 3 get pushed to the next year, but 2 of the deals close at $100m+. So for that we take in $16m on those two deals. For a small shop of 10 people, that's a solid pay-day for the amount of work we did considering 5 of the deals fell apart and 3 got pushed and are no guarantee.We weren't doing the Billion dollar deals of Goldman-esq transactions, but were solid middle market, maybe dipping to the $700m range depending on the transaction. We'd charge anywhere from 5-10% of the sale price plus a performance bonus if we locked in a deal above an agreed upon valuation pre-marketing, usually 3-5% of the amount above the specified value.

It was a very lucrative business but also susceptible to market forces, seeing as we had one year where I saw 15 transactions and 0 closed. (so I went to LS, and like anything, they closed 6 transactions the year after.) That all being said, I might make my way back to that in a few years depending on how BigLaw goes. I personally like the numbers and the deal work on the IB side, so who knows.

[Anonymous User]

Don't firms sometimes get paid based on a percentage of the deal for corporate work? I could be off base but always thought that was part of the reason they can be lucrative.

My understanding is that this is true for banks, but firms still charge by the hour for corporate work (I also want to say Wachtell may be an exception because their associates basically do IB work too). This explains why banks make much more money than law firms, because as deals have grown larger, bank compensation has grown faster than law firm compensation. I don't think it explains the gap between lit and corp within law firms.

In part this is true (former M&A IBanker here). But the main reason M&A firms who advise on the deal from the IB side charge so much more is b/c they often, though not always, don't get paid unless the deal closes, and not all deals close. They take a huge up front risk at only a engagement fee/retainer or none at all for the pay-day on the back-end. Conversely, law firms get paid, most of the time, regardless of if the deal happens or not, it's just a question of the magnitude of their bill.
up
So, for instance from my pre-law IBanking work, I might work on 10 different transactions in a year, say the firm charges a 8% fee on the purchase price when sold (we would do sell side mostly). Maybe 5 of those deals don't happen for whatever reason (financials, bad timing, shareholder dispute, etc) and 3 get pushed to the next year, but 2 of the deals close at $100m+. So for that we take in $16m on those two deals. For a small shop of 10 people, that's a solid pay-day for the amount of work we did considering 5 of the deals fell apart and 3 got pushed and are no guarantee.We weren't doing the Billion dollar deals of Goldman-esq transactions, but were solid middle market, maybe dipping to the $700m range depending on the transaction. We'd charge anywhere from 5-10% of the sale price plus a performance bonus if we locked in a deal above an agreed upon valuation pre-marketing, usually 3-5% of the amount above the specified value.

It was a very lucrative business but also susceptible to market forces, seeing as we had one year where I saw 15 transactions and 0 closed. (so I went to LS, and like anything, they closed 6 transactions the year after.) That all being said, I might make my way back to that in a few years depending on how BigLaw goes. I personally like the numbers and the deal work on the IB side, so who knows.

This is great info! Any advice for M&A lawyer to break into IB? Assuming finance background and mid 700 GMAT but no real work experience.

[Person1111]

There is way more competition for litigation work than for corporate work, which lowers the billable rates charged for litigators. Corporate clients are more willing to move their litigation matters to mid-sized firms and small "litigation boutiques" because they can charge less than their big law counterparts. These shops are way more efficient with expenses and don't need a lot of the big law resources used in the transactional practice. Litigation firms only really need online legal research tools and a small support staff to manage the firm. If they take on a larger case, there are plenty of contract attorneys available to work on short-term doc review projects and legal research. Additionally, a lot of the attorneys at these litigation firms are former big law attorneys or have the same (or better) credentials than their big law counterparts.

This is about 95% of it. The fact that a lot of litigation bills get paid by insurers (who nickel and dime like it's their job) is also a factor.

[nealric]

Also, the legal fees often pale in comparison to the amounts being transacted- $10 million in legal fees doesn't really register in a $10 billion deal.

I have no clue how billing for corporate transactions works, but I think something like the above might be a big part of the reason. On the litigation side, I keep hearing stories about how GCs don't want to pay for work done by first year attorneys, who nickel and dime every part of every bill, set caps on how much you can bill for legal research or meetings/conferences. Basically doing everything in their power to minimize costs when it comes to fees its paying attorneys to litigate cases. (To be fair, some of this is because firms tend to overbill on meetings and such. But other times it's the company being cheap.) This is also probably also why a lot of litigation work gets shipped off to boutiques that often promise flexible billing (not always hourly), fewer attorneys on cases, etc.

Basically, it's very likely that companies don't mind if you pile on as many associates as humanly possible on a $10 billion deal (hence generating a huge stream of income for the firm), but they will nickle and dime you on every little thing when defending a case. The potential damages in litigation also matters a lot -- who wants to spend $2 million defending a case where the potential judgment might be $3 million? It's gotta be something like Apple v Samsung before a company lets you throw 100 attorneys at the case.

Side point on not wanting to pay for first year associates: In many cases, it's not that clients aren't willing to pay for junior associates per-se. I'd rather a junior associate do the more labor intensive but lower skill work on my matters. Rather, clients tend to object to first years being used as a way to inflate partner billing rates. For example, the junior is on every single call with the partner to "take notes" or gets assigned to research questions the partner already knows the answer to off the top of her head.

I'm not a litigator, but my first year lit friends constantly complain because they're not staffed on some really cool cases because the client has an explicit "NO FIRST YEARS" clause in their fee letters/engagements/etc. These are very large companies in a variety of industries. Seems kinda silly to me because now you're just paying more senior, more expensive attorneys to do grunt work, but there you have it. It makes more sense to me to allow first years and then just negotiate the bill, but I'm not the GC of some big public company.

Yeah, some companies do that. The way my company often does it is to approve the attorneys who will work on a matter in advance. If it's a matter that is going to need some junior associate heavy lifting, a junior is fine. If it's a high-level advisory-type engagement, we may not be too keen on a very junior person.

[Lacepiece23]

Also, the legal fees often pale in comparison to the amounts being transacted- $10 million in legal fees doesn't really register in a $10 billion deal.

I have no clue how billing for corporate transactions works, but I think something like the above might be a big part of the reason. On the litigation side, I keep hearing stories about how GCs don't want to pay for work done by first year attorneys, who nickel and dime every part of every bill, set caps on how much you can bill for legal research or meetings/conferences. Basically doing everything in their power to minimize costs when it comes to fees its paying attorneys to litigate cases. (To be fair, some of this is because firms tend to overbill on meetings and such. But other times it's the company being cheap.) This is also probably also why a lot of litigation work gets shipped off to boutiques that often promise flexible billing (not always hourly), fewer attorneys on cases, etc.

Basically, it's very likely that companies don't mind if you pile on as many associates as humanly possible on a $10 billion deal (hence generating a huge stream of income for the firm), but they will nickle and dime you on every little thing when defending a case. The potential damages in litigation also matters a lot -- who wants to spend $2 million defending a case where the potential judgment might be $3 million? It's gotta be something like Apple v Samsung before a company lets you throw 100 attorneys at the case.

Side point on not wanting to pay for first year associates: In many cases, it's not that clients aren't willing to pay for junior associates per-se. I'd rather a junior associate do the more labor intensive but lower skill work on my matters. Rather, clients tend to object to first years being used as a way to inflate partner billing rates. For example, the junior is on every single call with the partner to "take notes" or gets assigned to research questions the partner already knows the answer to off the top of her head.

I'm not a litigator, but my first year lit friends constantly complain because they're not staffed on some really cool cases because the client has an explicit "NO FIRST YEARS" clause in their fee letters/engagements/etc. These are very large companies in a variety of industries. Seems kinda silly to me because now you're just paying more senior, more expensive attorneys to do grunt work, but there you have it. It makes more sense to me to allow first years and then just negotiate the bill, but I'm not the GC of some big public company.

Yeah, some companies do that. The way my company often does it is to approve the attorneys who will work on a matter in advance. If it's a matter that is going to need some junior associate heavy lifting, a junior is fine. If it's a high-level advisory-type engagement, we may not be too keen on a very junior person.

I actually hate this. If you're the junior, and say you get a massive document dump, you can't rope in another junior to help you because he/she isn't preapproved on the bill. This turns into needless firedrills and all-nighters where another junior could have stepped in and very easily pitched in and helped out.

[Anonymous User]

Don't firms sometimes get paid based on a percentage of the deal for corporate work? I could be off base but always thought that was part of the reason they can be lucrative.

My understanding is that this is true for banks, but firms still charge by the hour for corporate work (I also want to say Wachtell may be an exception because their associates basically do IB work too). This explains why banks make much more money than law firms, because as deals have grown larger, bank compensation has grown faster than law firm compensation. I don't think it explains the gap between lit and corp within law firms.

In part this is true (former M&A IBanker here). But the main reason M&A firms who advise on the deal from the IB side charge so much more is b/c they often, though not always, don't get paid unless the deal closes, and not all deals close. They take a huge up front risk at only a engagement fee/retainer or none at all for the pay-day on the back-end. Conversely, law firms get paid, most of the time, regardless of if the deal happens or not, it's just a question of the magnitude of their bill.
up
So, for instance from my pre-law IBanking work, I might work on 10 different transactions in a year, say the firm charges a 8% fee on the purchase price when sold (we would do sell side mostly). Maybe 5 of those deals don't happen for whatever reason (financials, bad timing, shareholder dispute, etc) and 3 get pushed to the next year, but 2 of the deals close at $100m+. So for that we take in $16m on those two deals. For a small shop of 10 people, that's a solid pay-day for the amount of work we did considering 5 of the deals fell apart and 3 got pushed and are no guarantee.We weren't doing the Billion dollar deals of Goldman-esq transactions, but were solid middle market, maybe dipping to the $700m range depending on the transaction. We'd charge anywhere from 5-10% of the sale price plus a performance bonus if we locked in a deal above an agreed upon valuation pre-marketing, usually 3-5% of the amount above the specified value.

It was a very lucrative business but also susceptible to market forces, seeing as we had one year where I saw 15 transactions and 0 closed. (so I went to LS, and like anything, they closed 6 transactions the year after.) That all being said, I might make my way back to that in a few years depending on how BigLaw goes. I personally like the numbers and the deal work on the IB side, so who knows.

This is great info! Any advice for M&A lawyer to break into IB? Assuming finance background and mid 700 GMAT but no real work experience.

Unless you're going to get an MBA, that GMAT doesn't matter. For the most part, in the real world, other than people who can't get through the day unless they discuss what their GPA/LSAC/SAT/etc score is (credit half of the people on TLS), no one gives a flying fuck about what you scored on those tests, because frankly they're all beatable and some of the best IB/PEG/VC people I've worked with weren't top of their class, but people who busted their balls outside of the classroom.

So, that all being said, like anything, networking with them is going to help you the best. Also, when you're on the deals, don't point out problems for the sake of them being legal, discuss the business implications of them. For instance, I'm a first year but was on a deal and had the data room to look through
what the deal was all about. Started to get me thinking that rather than doing a cash for stock deal, I commented to an associate that the PEG client (it's a small family office and this was to be their first deal, small, around 20m in size) should do this as a private LBO, and explained why. Associate mentioned it to the partner and the partner had me discuss it with the client (after the partner vetted my pitch). Fortunately the client didn't think I was completely talking out of my ass so we switched the deal around to an LBO and so far things are going well. Now I'm on the PEGs radar as someone who knows what their doing on a finance/accounting side, as well as legal side.

The way I look at it is a way to get my foot in the door and when I get to know them well enough, I'll mention I'm interesting in shifting to another career and see if it goes somewhere. If not, I'll take my 160+ and happily work on my side projects as well.