Group Overview

Keystone Law ('Keystone') is a UK Top 100, fast growing, profitable and cash generative challenger law firm. Established in 2002, Keystone is one of the first platform models (or "the networked law firm") disrupting the traditional model of law firms operating within the legal services mid-market. Keystone's model permits scaleability of its operations, enabling an increase in the number of revenue generating, experienced lawyers quicker than the traditional model.

Strategic Overview

The UK legal services market is the second largest in the world, behind the US, with fee revenue of £33.4 billion, accounting for approximately 10 per cent. of global legal services revenue (source: The CityUK – UK Legal Services 2018). The UK market is extremely diverse, with the "Magic Circle", "Silver Circle" and other "global elite" law firms, representing the top 15 in the UK by revenue, generating in aggregate £16.3 billion and, at the other end of the market, a large number of firms outside the UK Top 200, with annual revenues of below £9 million. These smaller firms are categorised by the Directors as the "high street" offering. The segment between the top 15 and the high street offering is UK-centric and categorised by the Directors as the "mid-market". Generating £9.5 billion of annual revenues, this is the segment in which Keystone operates, and typically where it has recruited its lawyers from.

Market trends

Conventional UK mid-market law firms have, for several years, suffered from pressures brought about by the increasing commoditisation of many of their services as well as the general economic climate. This has resulted in ongoing pressure on fee income which has been compounded by increasing overheads, in particular property costs.

The Directors believe that conventional firms have typically responded to these market trends by setting their experienced lawyers with progressively increasing billing targets, whilst expecting them to drive business development and retain significant managerial responsibility. At the same time, the Directors believe much of the historical appeal of equity partnership has reduced, with many junior partners no longer seeing the merits traditionally associated with that form of ownership. These dynamics have resulted in a significant number of experienced but dissatisfied lawyers across the UK mid-market seeking alternative ways to practise law.

The Directors believe that, as a result of these trends, the UK legal services mid-market offers significant opportunity for an alternative model law firm such as Keystone.