1. 2012 Redwood Analytics® User Conference Analysis. Insight. Action. Expansion Strategies Derek Schutz Director of Programs

2. 2012 Redwood Analytics® User Conference Analysis. Insight. Action. Panelists Brian Baudot – McGlinchey Stafford PLLC Chief Financial Officer Julie Baker – Stinson Morrison Hecker LLP Director of Analysis

3. 2012 Redwood Analytics® User Conference Analysis. Insight. Action. We will cover Trends in the Legal Markets Lessons Learned Panel Discussion Tactics to Promote Success Economic Pressures Change Client Demands

4. 3 Changing Expectations Yes – Permanent Change20092012 Fewer equity partners 22.8%67.6% More contract lawyers 28.3%66.2% Reduced leverage 12.1%57.7% Smaller first year classes 11.4%55.4% Outsourcing legal work 11.5%45.5% Do you think fewer equity partners will be a permanent trend going forward? * Copyright 2012 Altman Weil, Inc.

5. 4 Growth Options What growth options, if any, will your law firm pursue in 2012?

6. 5 Growth Trends Page Title Top Growth Options201020112012 Acquire laterals85.3%91.6%92.3% Acquire groups54.8%67.1%68.2% Acquire law firms19.7%23.0%29.5% Open new US office/s17.6%24.6%27.9% 2012 Growth Options by Firm Size> 250 Lawyers <= 250 Lawyers Acquire laterals89.7%98.5% Acquire groups57.4%93.8% Open new US office/s23.9%37.5% Acquire law firms21.9%47.7% * Copyright 2012 Altman Weil, Inc.

7. 6 Why Expansion?

8. 7 Client satisfaction and loyalty Innovation Brand perception Productivity gains Diversity Market share/Wallet share Relationship strength Succession planning Acquire new business/Keep existing business Geographic necessity

9. 8 Potential Problems Cultural Cohesion

10. 9 Potential Problems Cultural Cohesion Increases in Fixed Expenses

11. 10 Potential Problems Cultural cohesion Increase in fixed expenses Ostracize existing partners

12. 11 Potential Problems Cultural cohesion Increase in fixed expenses Ostracize existing partners Client conflicts

13. 12 Potential Problems Cultural cohesion Increase in fixed expenses Ostracize existing partners Client conflicts Time Commitment

14. 13 Mitigate Risk Communication is key – surprises (especially negative income) can have disastrous results Leadership decisions (who comes, who stays, who goes) Economic situation – read the tea leaves Understand who the “glue” is Make sure you are paying attention to the ‘Right’ metrics

15. 14 Panel Questions Brian Baudot – McGlinchey Stafford PLLC Chief Financial Officer Julie Baker – Stinson Morrison Hecker LLP Director of Analysis

16. 15

17. 16 Sample Reports

18. 17 Sample Reports

19. 18 Sample Reports

20. 19 Sample Reports

21. 20

22. 21

23. 22

24. 23

25. 24

26. 25

27. 26

28. 2012 Redwood Analytics® User Conference Analysis. Insight. Action. Expansion Strategies Derek Schutz Director of Programs