Capital Unbound: How MSOs Are Changing Law Firm Economics

Legal ethics attorney Trisha Rich was featured on The LegalTech Fund podcast explaining how management service organizations (MSOs) and alternative business structures (ABS) are transforming the legal profession. She began the episode by distinguishing MSOs from ABS, the former being independent companies that handle the administrative and business functions of a law firm that work within the confines of Rule 5.4 concerning nonlawyer ownership of law firms and the latter being a particular model allowed only in Arizona because that state has eliminated Rule 5.4. She then described why MSOs and ABS are top of mind for practitioners and private equity firms: new investment opportunities, high-profile market moves and the need to access capital to advance technological improvements, harness artificial intelligence (AI), enhance workplace culture and create operational improvements – all of which can help lawyers focus on practicing law and serving clients. Ms. Rich additionally talked about the deals on which her team is currently advising (around 50) that run the gamut from Am Law 100 to small firms as well as addressed common misconceptions about MSOs, such as ethical rules surrounding their incorporation into the legal industry.

Duration: 18:51