Commercial Awareness Discussion Thread

futuretraineesolicitor

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Have you looked at Finimise? Also TCLA has a commercial newsletter you can sign up to if you haven't already.
Hey. Thank you for your answer. I just feel that Finimize is great but it isn't as extensive as Watson's Daily. Reading Watson's Daily on an everyday basis is a huge task and with other websites, I just feel like there isn't much ground that's covered. And yes I've signed up to the TCLA newsletter but I have a lot of free time during the weekdays as well so I was hoping if you could point me to a resource that is pretty exhaustive and detailed.

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futuretraineesolicitor

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Hello guys. Hope you all are doing well. My question is around law firms as a business. From what I've understood- there are 2 ways of billing the client. One is the Fixed Fees model which is basically a cap on the overall bill and the second is the Conditional Fee Arrangement model in which the client only pays for the lawyer's services if they win their case. This is what's given in the TCLA Premium module but recently I was watching a webinar on TCLA Premium itself wherein the speaker refers to Alternative Fee Arrangement. I'm guessing that this is another name for the Fixed Fees model. Am I right? @Jaysen @Daniel Boden

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Jacob Miller

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  • Feb 15, 2020
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    Hello guys. Hope you all are doing well. My question is around law firms as a business. From what I've understood- there are 2 ways of billing the client. One is the Fixed Fees model which is basically a cap on the overall bill and the second is the Conditional Fee Arrangement model in which the client only pays for the lawyer's services if they win their case. This is what's given in the TCLA Premium module but recently I was watching a webinar on TCLA Premium itself wherein the speaker refers to Alternative Fee Arrangement. I'm guessing that this is another name for the Fixed Fees model. Am I right? @Jaysen @Daniel Boden

    Thank You.
    By my understanding, AFA's are basically a blanket term for any fee arrangement which is not a classic all-hours-billed or fixed fee model - for example, a client having an 'account' of X number of hours per year/ block hours discounted/ etc etc.

    Fixed Fee and AFA models will be far more common at major City firms; CFA's tend to be more for private client work, such as employment discrimination or personal injury and other claims in tort.

    Again, the caveat is that the above is only by my understanding, so do feel free to point out if I'm under a misapprehension.
     
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    futuretraineesolicitor

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    By my understanding, AFA's are basically a blanket term for any fee arrangement which is not a classic all-hours-billed or fixed fee model - for example, a client having an 'account' of X number of hours per year/ block hours discounted/ etc etc.

    Fixed Fee and AFA models will be far more common at major City firms; CFA's tend to be more for private client work, such as employment discrimination or personal injury and other claims in tort.

    Again, the caveat is that the above is only by my understanding, so do feel free to point out if I'm under a misapprehension.
    Thank you for your help Jacob.
     
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    Matt_96

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    By my understanding, AFA's are basically a blanket term for any fee arrangement which is not a classic all-hours-billed or fixed fee model - for example, a client having an 'account' of X number of hours per year/ block hours discounted/ etc etc.

    Fixed Fee and AFA models will be far more common at major City firms; CFA's tend to be more for private client work, such as employment discrimination or personal injury and other claims in tort.

    Again, the caveat is that the above is only by my understanding, so do feel free to point out if I'm under a misapprehension.

    Damages-based agreements are also something that can sometimes occur, but typically they are used by firms that do a lot of high-value PI (e.g. spinal injury) or product liability work.
     

    Jacob Miller

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    Damages-based agreements are also something that can sometimes occur, but typically they are used by firms that do a lot of high-value PI (e.g. spinal injury) or product liability work.
    In my experience, most CFAs also have a DBA element to them (this is having been a customer) - fees plus proportion of award relative to damages awarded.
     

    Matt_96

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    In my experience, most CFAs also have a DBA element to them (this is having been a customer) - fees plus proportion of award relative to damages awarded.

    This is true, but they can be separate too. I just mention it separately because it's something that is (admittedly only briefly) dealt with as a separate form of funding arrangement on the DR module I'm currently doing on the LPC!
     
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    Veep9

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  • Sep 8, 2020
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    Hi - I'm preparing a commercial awareness topic surrounding SPACs but I'm a bit confused as to exactly why they've suddenly become really popular?
    I just did this too. The impression I got was that they’ve been rising in popularity for a while but the boom in 2020 has been attributed to their attractiveness to financial institutions that may have some spare capital that they want to put to good use (interest rates are low so lending isn’t a great option) and the growing interest in unconventional companies (e cars or green products) which might not pass the procedures of a traditional IPO.

    Does that sound about right to those who know better?
     
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    Jacob Miller

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    Hi - I'm preparing a commercial awareness topic surrounding SPACs but I'm a bit confused as to exactly why they've suddenly become really popular?
    Theyre much simpler and cheaper than traditional floats too. This is because they're essentially a blank canvas, don't need to be marketed and touted around in the same way.


    The above article discusses it quite well.
     
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    Holly

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    Hi,

    This might be a really stupid question but I am struggling to think how vaccines affect the legal industry specifically? Can anyone give me some pointers?

    1. It affect the pharmaceutical industry, which affects a law firm’s pharmaceutical clients

    2. There’s talks about how some employers want to put a clause in their employment contracts which makes it a requirement for new and existing employees to be vaccinated. This is less of an issue for new employees, but law firms should still look for issues. For existing employees, this is contentious as it could give rise to discrimination lawsuits which is relevant for employment lawyers

    Those are my immediate thoughts! Hope that helps :)
     

    Manifesting

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    Theyre much simpler and cheaper than traditional floats too. This is because they're essentially a blank canvas, don't need to be marketed and touted around in the same way.


    The above article discusses it quite well.
    I would say that for companies seeking to go public via a SPAC merger, this process also offers certainty about price and about the deal going through. Whereas with an IPO, investment bankers can only offer you a range for value of your shares and things can go all sorts of ways depending on market appetite (and there is possibility of your IPO to get pulled too).

    Another thing that explains their popularity as a fundraising tool for companies is that you are able to use projections instead of just historical data to really wow the SPAC investors, who have to vote to approve the merger. For high-growth, scalable companies who haven’t really made money yet, this can be a huge plus as they can appear more attractive.

    In a traditional IPO process, it is customary not to use projections and to only rely on historical data when marketing to investors (and
    generally keep company executives out of the spotlight during this time). In the US, the SEC provides a safe harbor for companies to use projections but still, due to fears of litigation, the convention is not to use them.

    For investors, SPACs are super attractive because if they don’t like the company the SPAC is merging with, they can walk away with their money with interest. (Also, when you invest in a SPAC you also also receive an option to buy more stock at a fixed price, and this warrant can be traded and serve as another source of value for an investor.) In the UK, the rules are less investor-friendly. Basically, if I understand it correctly, shares have to be suspended once a deal is announced and investors can only resume trading once the deal is done. So essentially, you might find yourself locked into a deal you might not like, which explains why SPACs have not boomed in the same way as in the US.
     

    Daniel Boden

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    Does anyone know how big tech becoming more regulated might impact law firms?
    For one, it will mean that law firms' corporate and financial regulatory departments will receive more work from their tech clients as they advise them how to structure their deals/businesses so as to be compatible with this increased level of regulation
     
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