The transition to revenue-sharing

As the world begins to emerge from the effects of Covid and life edges closer to normality, many are taking the opportunity to reflect on their lives and what makes them happy. Whether it is feelings about life at home, in surrounding communities, or at work, people are taking time to reflect on what is important and makes a difference in their lives.
The pandemic introduced many to home working for the first time and now law firms are transitioning to hybrid working patterns, revenue-sharing represents an opportunity for lawyers who fully embraced the change and no longer wish to have any commitment to returning to the office.  
A growing trend

Recently published research from leading recruitment firm Manpower highlights a reluctance on the part of existing employees in professional services to return to office-based working. Employers keen to have teams operating from offices are phasing out remote working for new candidates, forcing a re-think on behalf of those perhaps looking for a new opportunity on the same basis as the one they currently have. A revenue-sharing model is therefore an attractive option for legal professionals looking for change but wishing to retain flexibility in how they work.

In our recent survey of the revenue sharing law firm operators arch.insights September 2022, we saw evidence of an increasing number of lawyers and advisors taking control of their own destiny, with the number operating on a revenue-sharing model consistently developing over the past 3 years and the 5 largest UK platform law firms all steadily growing their number of advisors year-on-year.

It will be fascinating to see how traditional law firms evolve to try and retain their top talent. Our independent research shows an increase of 45% in the number of advisors transitioning away from the more traditional law firm experience to more flexible working practices since 2020.

Increased earning potential

The revenue-sharing model enhances a lawyer’s ability to develop a direct connection between the work they do and what they earn. Unlike traditional law firms, where the expectation is often that advisors bill 3.5 times or more of what they get paid, revenue-sharing allows advisors to earn between 70% to 75% of the revenue they generate.

The capacity to earn 70% of the revenue generated instead of the traditional 30% is a significant appeal. An additional revenue stream exists through the referrals, enabling our revenue-sharing members (portfolio members) to leverage our flexible lawyer platform (resource members) to deliver work to clients, leading to the equivalent of between 30% and 35% as an introduction fee. Most platforms offer between 10% and 15%.

Developing lasting relationships

One of the other realisations that many lawyers have had is the close nature of the relationship they have with their clients, enabling them to enjoy a quantity and quality of clients through revenue sharing law firms previously thought impossible.

The increased shift among young lawyers towards revenue-sharing working practices has had a devastating effect on teams, as firms struggle to keep hold of talent due to an inability to balance rewards and development opportunities with remote working opportunities valued so highly by potential employees.

A prolonged period of delivering legal services remotely rather than in a corporate office environment has helped lawyers identify that clients often select the individual rather than the firm. The brand will remain an important consideration to some clients, but individual ability, experience, and credibility are key factors – often more so than cost – and trust in a lawyer to achieve the right result within a given time and cost will build long-term loyalty.

Flexible working

It appears that two years in lockdown has helped many people re-evaluate their priorities and as a result, we have seen many global trends emerge. Data from the Office for National Statistics highlights that almost 50% of working adults in the UK were doing so from their homes during the pandemic.

Many law firms emphasise culture as a key tool in talent acquisition and retention, but it is difficult to build an effective culture with embedded values when employees are working from home. This could be a driver behind the increasing trend toward hybrid working practices, where firms require partners and employees to work a minimum number of days each week or month from the office.

Furthermore, a recent survey by the management consultancy Advanced Workplace Associates indicates that globally the average office attendance was less than 1.5 days a week. Attendance peaked in the middle of the week, but even then, no more than a third of employees were actually in the office.

Today, an average of 65%+ of office desks are unused from day to day as many choose to continue flexible practices through frameworks such as revenue-sharing. Changing mindsets and shaping an office-based culture will therefore be a huge challenge for large law firms in future.

Enhanced decision making

In general, law firms are resilient to recessionary times, as the fall in transactional business is often balanced by the growth in litigation in contentious matters. However, the fall in productivity brought about by the drop in relevant business exposes many transactional law specialists, with firms unable to justify high salaries and provide job security during a period of reduced revenue.

This brings us back to the continued evolution of the legal services market where, despite seeing a slowing of year-on-year growth in the number of advisors switching to revenue-sharing from +21% between 2020-21 to +12% between 2021-22, lawyers continue to grow confident in their ability to attract and retain clients without the backing of a big brand.

In larger firms, the ability of the senior lawyer to influence levels of reward and recognition from central budgets is much reduced, but there remains an ever-increasing need for enhanced productivity, which can only come from teams working harder. Under revenue-sharing, individuals can vary their schedules to align with other important aspects of the lives and not have their workload dictated by the needs of corporate firms.

Greater security

Large law firms do not guarantee job security and are subject to the same fluctuations in market conditions that impact businesses in all sectors. Pressure to grow business with fewer resources leads to greater scrutiny on performance and increasingly demanding metrics. Advisors choosing to establish their business within have full control of their job security and create the opportunity to improve their earnings.

This increased resilience to outside influences allows lawyers to establish a sustainable business where they have full autonomy over their clients and workload. Greater control builds confidence and helps develop mechanisms that provide protection when times are challenging.

Access to specialist experts

Historically, lawyers and advisors have been reluctant to move to a revenue sharing law firm as they believed their clients would not have the same access to the breadth of expertise available through a traditional law firm. As the revenue sharing model gains in popularity this has become far less of an issue with many firms being able to offer a far larger spread of specialist skill sets.

International Support

Many clients trade in more than one country and so are likely to require support from outside of the UK from time to time. Although few revenue sharing law firms have ventured outside of the UK, is one that has and expansion into additional geographies is key to our strategy and delivering success for our clients.


Lawyers and advisors have more compelling reasons to move away from traditional law than ever. The basic financials speak for themselves, but when combined with the increased ability to make decisions, greater freedom to set charging rates and the salaries team members are paid, an enhanced ability to cross refer work and global access to the relevant technical skills required, the business case is extremely powerful.

If you decide to work with the key word is ‘business’ – it is your business within our business, and we will support you to grow that business successfully.

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