Many law firms are starting to debate if private equity will eventually reshape the legal industry and whether they should be seeking outside investment. It’s a fascinating question, but not the most pressing one. The first question firms–of all shapes and sizes–should be asking themselves is this: What would a private equity firm do today if it invested in your law firm?

That idea became the foundation for my new book, W.W.P.E.D.? (What Would Private Equity Do): Unlocking Value in the Law Firm You Already Own.

Whatever you think of outside investment, PE funds are very good at driving enterprise value at their portfolio companies. That’s how they eventually make their money. 

So we’re not arguing whether law firms should sell to private equity. Many firms probably shouldn’t. Instead, this book is an attempt to look at law firms through the same lens a PE fund would, with a focus on operational discipline, scalability, profitability, and incentives, all driving enterprise value.

Private equity tends to evaluate businesses with a level of rigor that law firms have not always (or even usually) applied to themselves. They look closely at margins, incentives, operational efficiency, scalability, succession risk, and whether technology investments are actually improving performance. These are things that every business, including law firms, should do. 

One of the key themes throughout the book is that firms do not need to abandon their culture or partnership model to become better-run businesses. The goal is not to corporatize law firms into something unrecognizable. It is to operate more intentionally and professionally: to make more disciplined decisions about pricing, business development, talent, operations, technology, client relationships, and long-term value creation.

The subtitle of the book is intentional: Unlocking Value in the Law Firm You Already Own.

Some firms may eventually pursue outside investment. Others never will. But nearly every firm can benefit from thinking more seriously about enterprise value and what it will take to compete over the next decade. That’s What Private Equity Would Do.

Want to learn more? Get your copy today wherever books are sold.