Starting from scratch: ex-HSBC deputy GC Richard Given on his new challenge at banking startup 10x
HSBC's former deputy GC on modern legal services providers, the limitations of the traditional partnership model and why law firm leaders need to shake off short-term thinking
September 13, 2017 at 06:16 AM
6 minute read
"Law firms will thrive or sink depending on the extent to which they can articulate and own their specialist area," says Richard Given, general counsel and company secretary at 10x Banking, the fintech startup launched last year by ex-Barclays CEO Antony Jenkins.
As the sole lawyer at 10x, Given has been handed free rein to select a line-up of legal services providers for the fledgling company, and he is certainly not lacking in insight into the available options, given his previous role as deputy GC and global head of legal for worldwide operations at HSBC, as well as more than a decade in-house at Cisco Systems and Aegis Group.
Making the the move from one of the world's largest banks to a company with just over 150 full-time employees is certainly an interesting move, and 10x is an interesting company. It is aiming to create a banking platform "built on open banking principles, infinitely configurable and constantly evolving to deliver better, more personal, experiences for everyone", according to its website. The mix of technology and banking means the new role neatly combines Given's previous experience at HSBC and tech company Cisco.
As the company's only lawyer, one of the tasks at the top of Given's agenda is to set up "an eco-system of suppliers", as he describes it. "To say the word panel would suggest it would be a group of law firms, and I am not entirely convinced of that," he explains. "It certainly won't be just law firms, and certainly not law firms in the traditional sense of a set of partnerships."
Given is of the opinion that many traditional law firms are not up to the task of coping with the fast-developing demands of the fintech world. "Law firm business models do not allow a lot of investment in this space," he says. "I have always felt that the pyramid structure was a revenue generating capability, but it doesn't really allow for future investment."
He believes that the way that partnerships are structured means that they will find it hard to corner the fintech market. Given discusses the concept that a law firm might want to invest its time into 100 different fintechs: "80 of them might well go to the wall. Fifteen will wash their own face, four will be successful and it must be hoped that one will be a unicorn. If a firm creates that model and it has created opportunities to recoup its investment appropriately, it could be a real force for good in the fintech world."
All too often you are talking to a law firm management team who are three to five years from retirement
However, Given's point is that such a model is likely to be a five to ten-year play. "All too often you are talking to a law firm management team who are three to five years from retirement. They are at the peak of their earning potential, but their economic interest in their organisation disappears as soon as they cease to be a partner. There is a cliff edge they leave on, so they are highly motivated to maximise their rate of return - which is human nature – and therefore their investment-making decisions are predicated on what's in it for them and what's in it for the company in the short term."
Although Given does not rule out working with more conventional law firms, he is clearly enthused by some of the newer players on the block, citing Riverview Law as a prime example of a firm that is investing in technology in a way that many larger law firms are not.
While 10x is still developing, he is likely to turn to contract lawyer providers such as LOD, Elevate or ES Agile. "I certainly don't want to be instructing a law firm where I think I am buying the partner, but find I am training a junior associate to learn my business. I may as well hire in a contractor and supervise them myself at a much lower rate," he explains.
The move to a start-up also chimes with Given's previous in-house experience of building from the ground up. Before pioneering the legal operations function at HSBC, he was head of legal for emerging markets at Cisco, where he oversaw the growth of the in-house legal team from two to 15. And in his first in-house role as UK GC at Aegis, he set in place processes to help integrate the 25 companies it acquired over a five-year period. So, while Given admits it may look "a little strange" to go from HSBC to a start-up, "if you understand the methodology of what I like to do in my roles, there is some sense to it".
Despite being the sole lawyer at 10x, Given thinks it is unlikely that his first hire will be another lawyer. "I said to Antony Jenkins soon after I started: 'If in five years' time I am still the only lawyer employed by 10x, I don't really mind'. I am not out to build an empire of lawyers and employees working for me."
He says that it is more likely that his first hire will be a legal process manager. This stems from his belief that his 'eco-system' of legal suppliers will comprise a wide range of businesses including technology providers such as the likes of Thomson Reuters. 10x will also be heavily led by data, and so understanding that data, processing it and utilising it for the legal team will be front and centre of Given's work.
"I am convinced of the importance of knowing what you know, and the data that you need to capture to manage that, so there is a good chance that a legal process manager or head of operations will be hire number one, if not one of the first few," he says. "We are building in a way that does not constrain us for the future."
Given clearly relishes the size of the challenge facing him, and is animated about the task of creating a modern legal department for a modern company. "One of the excitements of the job is building a legal function with 10x at its centre, and lining up the way the legal services are delivered to maximise the success of 10x, rather than maximising the success of legal."
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