The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 18 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Ballis: Kirkland scaled private equity by hiring lateral partners over slow internal promotion
“Some of the great law firms in the space stuck to a more traditional model, and what I mean by that is you recruit people from law school, you train them up, and they decide to stay, and their skill sets fit, and they, 1015 years later, are partnered. But we s…”
Kirkland cycles out PE partners in their fifties to recycle equity
“Ensuring that our younger superstars are compensated properly, the way to do that is we don't have a lot of people in their sixties, let alone seventies, stay around our firm, particularly on the private equity side.
Litigation can be a little different, but c…”
Kirkland avoids political issues due to asymmetrical downside with clients and staff
“We decided that it was best to stay apolitical, stay neutral on highly politically charged topics, which, by the way, happened not to be the core of what we do. That's not what we do as a business. We decided it's asymmetrical downside, because if you get invo…”
Ballis: Kirkland has 25 dedicated non-client-facing partners
“We now have 25 partners whose sole job is to make the revenue generating partners better. Those 25 partners are not client facing. They facilitate revenue generating. They're just not client facing. They make all of our jobs easier. They create best of class f…”
Ballis: Regulating institutional private equity contracts is inefficient
“With institutions that hire law firms like Kirkland and Ellis and large financial advisors, does a large sovereign wealth fund need ultra protection to negotiate against a private equity institution? They know what they're doing, and they can hire people to un…”
Kirkland & Ellis reached $6B in revenue and $3.5B in profit
“I think in the last decade, we've tripled our revenue, grown from a thousand lawyers to now almost 3000. We have 19 offices across the United States, Europe, and Asia. Technically, it's six billion dollars of revenue, three and a half billion dollars of distri…”
PE clients expect outside counsel to make decisions, unlike Fortune 500 clients
“When you represent the fortune 500, your clients are lawyers. When you represent private equity teams, your clients are investment professionals, oftentimes very young investment professionals, and they're looking for you to make the call. Tell me what I shoul…”
Kirkland partners share one profit pool, reallocated every two years without bonuses
“We are not a commission-based system, or a, sometimes people describe an eat-what-you-kill system.
We all share from one trough, and we all have partnership points.
Those points are reallocated every two years.
We don't have bonuses.
We don't have cash compens…”
Non-originating tax lawyers are among Kirkland's highest-paid partners due to deal expertise
“We have tax people, who in a traditional sense, you might say, generate no business.
They help on deals, but they're some of our highest paid people.
Why?
Because we can't do what we do without their skill set.”
Ballis: Kirkland compensates partners for passing matters to better-qualified colleagues
“Because we don't have a commission, eat what you kill kind of system. If you're working on a transaction or a restructuring matter or a litigation matter, and there's someone down the hall or across the country who's just done that and is better qualified to d…”
Ballis: Influx of capital shifted fund negotiating leverage from LPs to GPs
“As more and more capital has chased
More and more private capital firms.
The private capital firms have garnered more leverage, so they've been able to drive terms a bit more than the limited partners have over time.
Now again, everything's relative, but the g…”
Ballis: Deal speed is the key litmus test of buyer versus seller leverage
“Speed of deals might be one of the great litmus tests of how much leverage a buyer, the sponsors have versus the targets.”
Ballis: Private equity makes up roughly two-thirds of Kirkland's business
“Private equity is about two-thirds of our business today. The rest is high-end litigation. That's about a quarter of our business. Restructuring is the remaining, although restructuring bounces between more or less than more, depending on the cycle that we're …”
Ballis: Reverse breakup fees became ubiquitous in PE buyouts after 2005
“Until 2005, the way deals worked is that the private equity sponsor would say, I'd love to buy your business for a hundred dollars, but I'm borrowing 50 dollars, and if I can't get my mortgage, I've got a mortgage contingency in my contract, and there was a de…”
Rep and warranty insurance reduced M&A indemnity negotiations from 10 to 3
“A number of years ago, but not that many, three, four, five representation warranty insurance has popped up, where now the large insurance firm, they underwrite the exposure, and therefore the negotiation over these topics has gone from a 10 to like a three.
I…”
Ballis: Sponsors favor private credit for execution certainty and zero term flex
“One thing that sponsors love about the private credit space is that there's certainty. They're not syndicated. It's not one of the big banks looking to syndicate out the loan. They buy the deal. The private credit providers, they're the ones that are going to …”
Kirkland & Ellis is investing heavily in retail investor legal expertise
“We're investing heavily in attorneys that are experts with retail investors, because we see the industry moving that way.”
Ballis: Kirkland alumni have held senior roles in every presidential administration since Bush 41
“We've had people in significant roles, at least in every administration I know just off my head, since Bush, 41, through Clinton, Bush, 43, Obama, And Trump. And now Biden. We've had people in very senior roles throughout all of them.”