AL Analysis: The Mishcon + Taylor Vinters Innovation-Focused Deal – Updated

What does the deal mean? (Includes a couple of updates that help clarify things.)

One law firm people expected to stay fully independent for a long time to come was Mishcon de Reya. It had travelled its own path over many years and clearly had succeeded in most of its objectives, having built a strong reputation in property, litigation, and private clients.

Then there is MDR LAB and a range of innovation projects, from building out its data science team, to helping founders to iterate their ideas, to investing in legal tech companies. It has also just done a deal with a litigation funder. And now it is soon to do an IPO, which will generate a surge of new cash that it can invest in all manner of new projects.

So, it didn’t need to do this combination with Taylor Vinters. They were doing just fine. Also Taylor Vinters was doing well too and growing nicely with a focus on working with startups and tech companies.

The ‘combination’ itself will result in MDR Taylor Vinters, which is an expanded and strengthened version of Taylor Vinters – focusing as before on tech, VC work and startups.

So, as far as it’s understood, there will be two main entities in the forthcoming new structure, Mishcon de Reya and MDR Taylor Vinters.

This therefore has to be seen as an opportunistic deal for both parties, and the IPO perhaps is what catalysed the decision. They both also have a lot of overlapping interests, which in recent years have only got closer with Mishcon’s parallel focus on startups and tech.

Of course, this is not a simple merger, in fact it is not even technically a merger at all – at least not yet. The two firms will be part of a single corporate structure – they hope – and there are several ways they could do this. It’s also not clear how the two firms will share profits. No doubt corporate structure experts have been working hard on Mishcon’s and Taylor Vinters’ many options.

And then there is the folding of MDR LAB into a bigger innovation group. Or as the firms said: ‘The long term vision of the Mishcon de Reya and Taylor Vinters teams is to establish the MDR Innovation Hub which will bring together MDR Taylor Vinters, MDR LAB, MDRxTECH and utilise the data science expertise Mishcon has built into a centre of excellence for the innovation economy. The MDR Innovation Hub will be led by a combined Taylor Vinters and Mishcon management team.’

This makes sense and could be a positive. By bringing under one roof a lot of expertise focused on tech and startup companies from both the MDR and Taylor Vinters side of things, the sum may well be greater than its parts and offer legal tech startup companies a lot of additional expertise. For example, Taylor Vinters has a lot of experience advising tech companies coming out of the university towns of Oxford and Cambridge.

Overall, one has to hand it to Mishcon when it comes to ambition, and one wonders what will come next?

One big question is what will Mishcon do in the US now? It’s the biggest legal market in the world, and clearly the world’s largest centre for startups. If continued growth is what they plan for with Taylor Vinters, then America will one day have to become a priority – even if their planned publicly listed structure would be tough to operate in most of the US – although not impossible with the right regulatory firewalls, see listed UK law firm DWF, for example, which has part of its business in America.

Also, only last year they closed their office in New York, after running a base in the Big Apple for 10 years, mostly focused on litigation. But that doesn’t mean they won’t be back with something new that meets their broader strategy.

We shall be waiting to see what happens next on the transatlantic front…and perhaps elsewhere in the world too. One thing about doing an IPO is that it demands growth. And growth globally is always an option. That said, they will have plenty to do if they only focus on the UK for now. But, eventually……

Overall then, a bold and innovation-focused move that although complex in structure should eventually provide some tangible benefits to clients and the legal tech companies that engage with the two firms as they move towards ‘combination’.

Mishcon is certainly never boring!

By Richard Tromans, Founder, Artificial Lawyer, Sept 2021.