Thank you for sharing!

Your article was successfully shared with the contacts you provided.
As the economy improves and deals begin to flow into Silicon Valley anew, firms are again relying on mid-level corporate associates to do a lot of the work. Trouble is, three years of deal drought have left many of those associates short on the experience necessary to handle the tasks. “There is a hollowing out of lawyering skills in Silicon Valley,” said Weil, Gotshal & Manges partner Rod Howard. Some young lawyers “don’t have a normal, reasonable toolbox.” Mid-level associates are valuable to firms because they have more experience than rookie attorneys, yet usually are not involved in originating their own deals, as are more senior associates and partners. Instead, firms rely on mid-level associates to do a substantial amount of the work associated with corporate deals, ranging from conducting due diligence to writing first drafts of crucial documents. During the economic boom of the late 1990s and into 2000, scores of mid-level corporate associates were kept busy in the Valley, handling a flood of deals, particularly IPOs and venture capital work. When the bubble burst, several firms laid off lower-level associates, and the associates who were left struggled to stay busy. Further robbing those associates of substantive work were clients who insisted on working directly with partners — who suddenly were more available. Now that work is picking up again, firms are struggling to cope with thin ranks among those associate classes, particularly the classes of 2000 and 2001. And many of the associates that rode out the recession and stayed at firms don’t have the skills they should. “Firms want a consistent level of experience among all their ranks to properly staff deals,” said Carl Baier, president of Baier Legal Search and a former Wilson Sonsini Goodrich & Rosati litigator. “You can’t have six partners and one first-year working on a deal — or vice versa, for that matter.” These days, managing partners and recruiters scrutinize associates’ experience more closely than they once did, Baier said. For example, he said, “third-year” is no longer shorthand for a particular level of experience. “People want to know if they were just playing Ping-Pong at the printer or what they were actually working on.” Wilson Sonsini partner Martin Korman said most of his firm’s associates remained busy after the tech crash, in part, because the firm did lose so many people. Between 2001 and 2003, Wilson shed more than 130 lawyers, thinning its ranks to a current level of about 570. Korman admitted, however, that stagnation in the capital market cheated a whole class of associates of experience in that arena. Now, Wilson’s more veteran lawyers are helping the rookies play catch-up, he said. “Our more senior associates were generally around in the bubble period when capital markets were going crazy, and partners certainly remember that,” he said. “It’s essentially taking our experience out of winter storage and getting ready for the spring bloom in the capital markets.” Like other firm managers, Korman expects experience levels to even out as firms handle more work, as happened after the recession of the early 1990s. Wilson senior associate Paul Shinn was lucky enough to land in the Valley in the mid-1990s, when corporate work was plentiful. “When the dot-com bust hit, the people I felt sorry for were the people behind me. They didn’t see the same kind of deal flow as we did during the boom,” Shinn said. On the other hand, Shinn noted, a less hectic pace gave those associates more time to learn the finer points of a deal. “Those who stayed are successful. They just had to be more aggressive to get on those deals,” he said. At Latham & Watkins, associates in Silicon Valley “did fine in terms of opportunities,” said Chairman Robert Dell, because that office didn’t engage in excessive hiring during the boom and remained busy through the bust. Yet Dell conceded that the skill base of younger lawyers “is heavily impacted by the number of opportunities they have to engage in interesting work. So in a time of relative drought, it stunts their development to some degree.” Some Valley lawyers are even questioning the skill base of senior associates — those with roughly seven years in action. During the four years of the tech craze, Valley firms were “pushing out paper” in cookie-cutter IPOs and other deals, Weil Gotshal’s Howard said. “It was about speed. It was the commoditization of lawyering,” he said. Wilson’s Korman disagreed. “If you’re cutting IPO cookies, and you’re cutting capital market cookies. … Well, I guess that makes you a baker.” Gray Cary Ware & Freidenrich corporate partner Diane Holt Frankle is looking on the sunny side — for veteran partners, at least. Quipped Frankle, “It’s good for old people like me. It makes us more valuable.”

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]

Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.