WORKING FOR TINY LENDERS
April Rinne has worked on M&A deals worth hundreds of millions of dollars, as well as corporate financing for the likes of Citibank and McKesson.
But the third-year O’Melveny & Myers associate also takes an interest in transactions worth a lot less: specifically, loans worth just hundreds of dollars, made to small entrepreneurs in developing countries. And in her less-than-a-year tenure at O’Melveny, she’s already built up a small cadre of corporate lawyers who do pro bono and some billable work for microfinance organizations and their investors.
“It makes a different kind of impact with a different meaning at the end of the day,” said Rinne, who works in the firm’s San Francisco office. “And I really like the meaning behind the microfinance.”
With academic and professional experience in the field, Rinne has traveled the world to see what it means firsthand.
On one memorable trip, the then-Allen & Overy associate was in Bolivia to check out a microlender for a potential investor. There, she paid a visit to a leather-belt maker that had received and successfully paid off a couple of loans � all less than $500. The business was in full swing with its half-dozen employees working away in a small, dirt-floored shack. And in a closet-sized room that served as an office, Rinne found what impressed her most.
“On the wall there was a hand-drawn organizational chart that had mapped out everybody’s role and responsibility, and beside it was a growth plan, also hand drawn,” she recalled.
A far cry from the fineries of a corporate boardroom, to be sure, but an example of the direct impact these small loans can make on people, she said.
So far, O’Melveny has about a dozen microfinance clients, according to Rinne. Those include some large banks that are looking to invest in microfinance operations, and are paying for legal work. Mostly, however, they are of the nonprofit sort, like the Bay Area’s MicroCredit Enterprises, which finances microlenders around the world, and Kiva.org, a Web site that connects plain old individuals who want to be microfinanciers directly with entrepreneurs in the developing world.
� Zusha Elinson
TRENDY CORPORATE LAW
As the fashion industry evolves, lawyers are constantly shifting their focus to adapt, says James Williams, a Loeb & Loeb corporate partner who joined the firm last month.
To that end, Williams is attending the annual meeting of the International Trademark Association in Chicago at the end of this month.
He says it’s encouraging how seriously law enforcement and customs are taking trademark violations. “That’s resulting in more effective enforcement and more recoveries.”
But, like illegal file sharing, there’s always a new way around the enforcement. As authorities crack down on cheap knockoffs sold on the streets of New York or L.A., labels are seeing more sophisticated counterfeiting on Web sites such as eBay.com.
“It’s no longer buying a Rolex for $10 � now they’re selling them on eBay with certificates of authenticity for $900.”
Evolution doesn’t just come in response to counterfeiters. For Williams, the most interesting aspect of the fashion business is how it’s evolved in terms of business investment.
Traditionally, fashion has been considered a high-risk business because there isn’t much of an exit strategy, he explained. But in the past several years � with the high liquidity among investors � the fashion M&A world has been hot, he said. Banks and private equity are looking at the industry for investments, apparel companies are swallowing smaller companies, and non-apparel companies are acquiring fashion labels to expand their brands.
For example, Williams worked on selling the majority share of Trunk Ltd., a high-end rock and roll T-shirt label, to Live Nation, an entertainment company.
“They have nothing to do with apparel, but they realize the synergy with a rock-and-roll brand,” he said. “You see profitability with luxury brands rising at a disproportionate rate. I think other companies, whether they’re apparel or not, want to tap into that cache, embedded customer base and loyalty.”
Another case of deals motivated by that desire include Maserati linking with Ferragamo to do leather design for its automobiles, he said.
So who’s doing all this work? Very few firms have dedicated apparel practices, but that’s starting to change, he said. And with the increasingly corporate nature of the work, firms that are strong in M&A are getting the deals as well.
“For smaller startup brands, attorneys that practice primarily in apparel has a lot more value add,” Williams said, adding that an attorney who understands the business can bring expertise and valuable connections to the deal. “And GCs appreciate that they can use attorneys like me who understand buzz words and trends.”
� Kellie Schmitt
