Anyone know of solos who started with backing from PE firm or HF? I thought “lawyers must own law firms” would prohibit this sort of investment but maybe I’m missing something?

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I’ve never heard of that. Prohibitions on nonlawyers owning equity are a problem for sure. But more pragmatically, why would PE or HF ever invest in a solo shop? What’s the investment thesis? And the scale doesn’t rate

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PE and HFs are doing some private credit work, so that might be what you’re thinking of.

However, no solo will be able to scale up fast or high enough to warrant private credit lending to solo firms. The solo lawyer would need to borrow in the millions, if not tens of millions, to warrant interest from PE or HFs anyway. I don’t know of any solos who could manage this.

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Are you thinking of “backing” as utility of private law firms (PE and HF) to inform what MRPC 1.3 terms as “materially adverse” as in delving into back doors about informed consent to not “materially advance” and not cause “substantial risk” to duties owed to former clients?

They can work around the non-lawyer ownership prohibitions. They’re already doing this with doctors offices, vets, dentists, etc.

They just structure it such that they own everything in the business not legally required to be owned by the lawyer, all profits are passed through as a fee for “managing” the business, then you lawyers get salaries, sometimes in the form of “consulting fees”.

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