Armstrong Teasdale grew its revenue and head count last year as the St. Louis-based firm marked its arrival on the East Coast. But the partnership’s expansion took at least a short-term toll on profits per equity partner.
Gross revenue and net income both rose over 4 percent in 2018, reaching $120.7 million and $43.5 million, respectively. Revenue per lawyer grew by less than 2 percent, however, and partner profits fell more than 7 percent as the firm’s equity partner tier grew by almost 13 percent.
The firm netted nine more equity partners last year, for a total of 79, and the non-equity partner grew by two to 52 partners. Overall head count grew by five lawyers to 234. In September 2018 the firm opened an office in Philadelphia—Armstrong Teasdale’s first on the East Coast—with four partners and seven total lawyers from Montgomery McCracken Walker & Rhoads, including that firm’s executive chairman. At the start of 2019, 16 more Montgomery McCracken lawyers joined in Manhattan, giving Armstrong Teasdale a foothold in New York as well.
Managing partner David Braswell said the firm was focused on the cost side of the growth equation in 2018 and has now turned its attention to integration, with the goal of ultimately providing a full slate of legal services in each of its offices. The firm will look to bolster its intellectual property team along the East Coast, he said, for example.
“We certainly intend to continue to pursue a growth strategy in all of the markets where we presently are,” Braswell said. “It’s certainly conceivable that we could look at other markets as well for growth, but for now we’re focused on integrating the people that we’ve hired into our East Coast offices and attracting more talent through those offices.”
Braswell became managing partner this year, after previous managing partner John Beulick died in December 2018. Michael Chivell, the firm’s chairman, assumed Buelick’s role before Braswell took up the office.
Braswell said Beulick’s death affected the entire firm emotionally, but that the leadership transition has been “smooth” and clients have found the change in power “seamless.”
Beulick’s strategic vision was “firing on all cylinders,” Braswell said, adding that he has every intention of maintaining the course his predecessor charted. Armstrong Teasdale’s “core strengths” of litigation, corporate work and intellectual property matters helped drive its revenue growth in 2018, Braswell said.
As it adds the Northeast to its regional centers in the Midwest and Las Vegas, Braswell said the firm raised rates more than 3 percent last year. He added that the firm continues to pay associates competitively, but that Armstrong Teasdale does not “slavishly follow the law firms that are sort of leading the charge” to pay associates more.
“We believe that our Midwest rate structure enables us to serve clients in those [new East Coast] markets in a very competitive, efficient way,” Braswell said. “So we’re going to continue focusing on the integration and growth of those offices through continuous recruiting of lateral talent. And we’re thinking that that growth trend for 2019 will continue.”