Ask any aspiring capital markets lawyer how they plan to distinguish themselves, and boilerplate replies likely include mastering securities law and gaining experience at a prestigious Wall Street firm.
But that’s too narrow a vision, according to experts. Mastering the law is indispensable but not enough to leap ahead of the pack, according to capital markets veterans, who stress that young attorneys must learn to think creatively and counterintuitively.
That means developing sophistication about industry trends that affect particular clients — even if one’s background is not in economics — and a relentless desire to never stop learning. It also requires a big-picture approach that looks beyond daily minutiae and a willingness to go wherever necessary to develop the requisite skills.
Here, experts share tips for budding capital markets attorneys, whether they're still in law school or early in their career.
Look Beyond Wall Street
Goodwin Procter LLP partner Ettore Santucci launched his career in the 1980s, when dreams of working on Wall Street were nearly universal among young lawyers. Thrive there, and one can go anywhere — or so they thought.
But over the past few decades, Santucci said, the economics of Wall Street practices have forced firms to do more with less, resulting in leaner staffing and less training. That has led to many young lawyers' being extremely efficient in increasingly narrow slices of capital markets law, he said.
Santucci often sees young associates who handle specific financial transactions for specific clients each day, a habit that may satisfy a firm's short-term economic needs but doesn't aid an attorney's long-term skills development.
“Don't go to Wall Street first, because you are going to be a very small cog in a very large machine,” said Santucci, who works in New York and Boston. “Rather, go to Silicon Valley, go to Atlanta, go to Chicago, go to Boston, go wherever.”
Explore regions with bustling industries, and find an attractive niche suited to one's talents, Santucci suggested. Then get intimately acquainted with an issuers’ needs, and master a wide set of deal types, be it initial public offerings, stock-for-stock acquisitions or convertible securities deals, he said. Three years of such experience will establish a more well-rounded and marketable background for a striving attorney.
"At that point, you will become ready to embark upon a senior lawyer career," Santucci said.
Step Into Clients' Shoes
Knowing your clients requires knowing their industry. That starts with staying atop a regulatory landscape that is rapidly changing and drastically different for the energy, health care, technology, airline, and financial services industries, to name a few.
And it doesn’t end there.
Kirkland & Ellis LLP partner Matt Pacey said aspiring capital markets attorneys should also know a company’s business model and competitive environment. That requires reading the U.S. Securities and Exchange Commission filings of company competitors and listening to their earnings calls and investor presentations, among other things.
That way, when a law firm is advising on a prospectus or a 10-K annual report, the company knows its attorneys are truly engaged in the process. That goes a long way toward distinguishing a capital markets lawyer in the eyes of a client, according to Pacey.
"They want to hire people that understand their business, know their competitors and aren’t just letting them draft a disclosure and taking it at face value,” he said.
One trap young attorneys should avoid is getting bogged down in the process without considering the big picture. Securities offerings contain so many standard tasks that lawyers repeatedly do, such as reviewing a comfort letter submitted by an auditor, that it’s important for attorneys to not lose sight of the underlying reasons for why such requirements are necessary, Pacey said.
Figuring out how each step fits into a larger regulatory puzzle will deepen attorneys' mastery of the law, he added, and strengthen their decision-making ability when it is their time to lead. He encourages lawyers to ask questions, seek advice or research memos published by other law firms to educate themselves.
"Younger attorneys frequently miss out on learning opportunities by getting caught up in the process without thinking through each step, why their partner or senior associate is telling them to do each step and how it fits into the broader securities law regime," Pacey said. “If you are not really understanding and thinking through those pieces, you are missing great learning opportunities."
Plus, the work doesn't stop when the deal is done.
After completing a major transaction, young attorneys should take two hours to review each step of the process and determine what went right and wrong, Santucci advised. That above-and-beyond initiative, for which one won’t get compensated, can provide eye-opening lessons that young lawyers will find useful the next time they tackle a deal. It will also help them get noticed by senior colleagues.
“You cannot be content to do what people tell you to do,” Santucci said. “If you just do what people tell you to do, you will not learn.”
Bone up on Economics, Accounting
When thinking about the path to becoming a legal expert, the thought of achieving fluency in economics or accounting doesn’t spring to mind. But in terms of capital markets work, experienced attorneys say such sophistication is critical because companies value an attorney who can craft transactions tailored to advance their economic interests.
“Clients appreciate pragmatic lawyers who are going to give them solutions,” Shearman & Sterling LLP partner Lisa Jacobs said. “If you understand the economics, you can be that lawyer. You can shine.”
Students still in law school can take classes on economics, accounting and corporate finance while an attorney already practicing could tap into their firm’s library of taped courses or pick the brain of senior colleagues, Jacobs said, adding that external education is also an option. Even books by author Michael Lewis, aside from being lively and entertaining, contain practical lessons about the world of finance, she noted.
Pacey had no accounting background, but he picked it up on the fly. That knowledge comes in handy for an attorney because a company's financial statements form a key part of the prospectus or periodic filings that regulators scrutinize.
“People expect their securities lawyer to play a general role in financial reporting, and that inevitably includes financial statements,” Pacey said.
The value of building relationships is crucial to success for any practice, and capital markets is no exception. This is especially true for junior lawyers because contacts made early on are likely to resurface in future deals.
"Understand that from day one, you are establishing relationships with the people you are going to be working with, both within your firm and across the table,” Pacey said. “You are going to see those people for the rest of your career.”
On a personal level, many of those relationships evolve into enduring friendships. That’s critical because every attorney needs a strong support system that can help them navigate through the inevitable ups and down of their career, Jacobs said.
Plus, planting seeds early can flourish unexpectedly later. When a deal mate goes on to become a general counsel of a corporation or starts their own hedge fund or investment bank, the lawyer who forged that relationship has a profitable contact in ways they could not have originally imagined.
“Junior associates will be very surprised where their friends end up,” Jacobs said. “If you start making those connections early and you maintain them, you are so far ahead of the curve.”
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