We speak exclusively to Knights plc’s David Beech
David, thanks for speaking to us. It’s been a busy year for the firm. You floated on the stock exchange back in June. What made you go down that route?
We corporatised our business five years ago, and the logical next step, in order to grow the business, was to float on AIM. This has given us access to further capital to grow organically and through acquisitions. It has also raised our profile, which is helpful for recruitment and positioning Knights as the leading regional law firm.
You’ve said in the past that you think the old partnership model is redundant. Why?
The partnership model is highly inefficient, with partners focusing on their own fee income, rather than how to grow the business. By corporatizing, you take out the competition between employees and you are able to focus on running the law firm as a business. Despite saying this though, it isn’t an easy process.
Are you predicting that more law firms will follow your lead?
As I said, this is a difficult process so no; I don’t actually believe there will be a lot of law firms following this route.
What was the reaction like from your peers in the wider legal community when they found out?
I think other firms have been supportive of us, if not, intrigued as we are one of the few that has adopted a corporatized model and been successful.
How challenging was the process?
It wasn’t too challenging to be honest. It obviously takes a lot of time with the roadshow and getting all of the materials together, but once we explained our business model and the success we have achieved as the UK’s fastest growing regional law firm, it wasn’t difficult to get investors to support us. In fact, we were oversubscribed and have some high quality shareholders.
What did you learn from it and was there ever a moment during the preparations that you started to regret your decision?
No regret, I always knew this was the best next step for the business. It was a learning process to be a listed company and abide by the rules and regulations of AIM but we have great advisers that help us with this.
How long did it take from taking the decision to go public and float day itself?
Four to five months.
The IPO raised £50m so how did you personally feel when that happened?
The fundraise was oversubscribed and we attracted some significant investors, so this was a great boost to our confidence. I was delighted that we successfully listed Knights and that others could see what we have created. Ultimately though, this was just the first step to our new journey as a listed company, and the growth we want to achieve.
The share price has continued to rise so has that trajectory been in-line with your own ambitions?
Of course it is positive to see the share price go up, rather than down. However, I’m not too focused on this as part of our trajectory. My focus is the business, keeping my employees and clients happy, while growing organically and acquisitively.
On a more personal note, how has your role changed practically on a day-to-day basis?
It hasn’t to be honest. I still go and visit all the offices every week, and my role is still the same as it was. We now have to bare in mind abiding by the AIM regulations, and communicating with shareholders which we manage well.
How about managing and dealing with the added pressure of shareholders?
I’ve worked in private equity, so I know first-hand what the pressure can be and we are not fazed by this. We have hugely supportive shareholders who can see that we are good at what we do and so this hasn’t really been an added pressure. It means a bit more time is spent in London but that isn’t a bad thing.
You made your first post-float acquisition earlier this month with Spearing Waite LLP. How’s that going?
SW is a fantastic law firm, with a great reputation in Leicester. The integration is ongoing and has gone very well.
When (and where) can we expect the next acquisition announcement?
We are always looking for acquisitions that will integrate well into the group. For us, it isn’t really a cookie cutter approach but a gut feeling, as well as geographical location, as to whether they are firms we want to integrate into Knights. I can’t say when we will announce the next acquisition but there are certainly some in the pipeline and we will update shareholders in due course.