The private wealth opportunity behind Taylor Wessing’s US merger

Welcome back to the podcast. Now, one of the biggest stories in the legal market over the past few months has been Taylor Westings merger with US firm Winston and Shrawn. The deal is set to go live any day now as Winston Taylor and is part of this broader wave of transatlantic tie-ups we've been seeing. Much of the talk has been around the new firm's strengths in areas like private equity and IP, pairing Taylor Westings UK platform with Winston and Shrawn's strong US IP litigation practice. But one area that wasn't immediately clear was how Taylor Westings' market leading private wealth practice would fit into that equation. That is the topic of today's conversation as I'm joined by Gabriel Estavez, Taylor Westings head of international private wealth and Nick War, former head of international private wealth and current UK senior partner. We discuss how that practice works, how the client base is evolving, and what the merger means for private wealth on a global stage. Thank you very much to Lagora for sponsoring the Numbillable Podcast. Lagora is the category-defining AI platform, empowering lawyers at top firms and in-house teams to achieve more with greater precision and confidence. It solves concrete tasks like document extraction, reviewing against the firm playbook and suggesting well-crafted markup directly in Microsoft Word. Already trusted by 250 leading firms and organisations across more than 20 markets, Lagora is setting the standard for how great legal work gets done. You can find out more at lagora.com. So Gabriel, enlighten me then. What is the difference between private client and private wealth? Because they are always just sort of used interchangeably in my world. For us in a nutshell, private wealth is something far more water than private clients. Private wealth is a holistic offering which made up of a number of different service lines. So I'm a banking lawyer, but I have my own ultradenant with clients that I look after on behalf of the firm and they come to me not just for banking needs, but for as a trusted advisor. And we have partners like me across the different service lines, so real estate, corporate, disbuse, employment, tax, reputation management. In each of those teams, we have built a team of individuals that have experienced in acting in their service lines for those types of clients. And that's quite different to changing the name of a private client team to a private wealth team overnight, which is what a lot of firms did. So in a nutshell, for us, private wealth is an umbrella term for a holistic set of services that are specifically aimed towards old China worth individuals and families. And it means that we're able to target and service their personal and business needs, whereas private clients is obviously something far more specific. It's one of these, of course, service line for us in our offering, but it's one of a number of service lines and that's what that's a key differentiator for us in the market. And how have things changed in the past sort of five to 10 years then, Nick? Because it does feel that everything's become a lot more sort of institutionalized and it feels like on the client side, do they expect that same service that they would get if the law firm was advising a typical corporate client or something? Yes, I mean, it's a very broad church, and depending on how mature the wealth is or how mature the jurisdiction, whether the wealth is originated, it is. The baseline, as we see it, is we aim to provide the institutional service, but we have to be mindful of the client and of level of justification there, therefore we can tailor it accordingly. So these are a mix of kind of individuals and family offices. And I would say historically the business is more a principal business rather than the pure family office business. And what I mean by that is that again, it's a personalisation of the service. As the sophistication of family offices grows and principles, especially when you're onto second or third generation, leave a lot more of the day-to-day operational aspects to the family office. Obviously that business is a principal business, which is a bit in the family office business grows, but we have not reached that inflection point yet. And Gabriel, talk to me about some of the changes among the clients, because it does feel like we're probably living in a world where that kind of wealth has never been as mobile. And certainly, a lot of your clients, UK-based, or are they international or a nice mix? So over 90% of the clients that we have to all have a foot in mom to jurisdictions to a more jurisdiction. So to ask a question, we have UK-based clients, but actually if they are UK, then they have far wider either investments or assets or concerns or structuring that they need advice on. So that has changed, I guess, over time, I think if we go back probably the wealth was more UK-based or there was more traditional, let's call it, UK-based wealth, not solely with even at that time we had quite a blend of clients in that space, but certainly to your point, we've seen a lot more international mobility, not just in terms of family members moving, but also the wealth and capital and the structuring and where that can be invested and also the type of underlying assets that the capital has been invested in. That's changed probably from my career at Taylor West in the last 15 years where we have seen a bit of a movement from more traditional trophy assets, real estate ownership from maybe a patriarch or one of the elder members of the family that built their wealth many decades ago to as we reference Gen 2 and Gen 3, Educator in the US or UK, going back home, looking to invest in newer things, maybe redistributing the wealth, looking at diversifying, there are far more options in terms of how the wealth can be invested, how it can be structured, regulation change, rules change, and if you're not able to service that the whole spread of service lines at an international level, then you're not really able to provide a kind of compelling service because that's the type of client base that we're actually supporting. So yeah, how do you respond then? Because one of the trends, it's felt like, certainly since the current government's come to power, there has been a story around a lot of high networks leaving the country, some of the destinations you hear about a lot of Milan, for example, Dubai, maybe Switzerland, how do firms respond? What do you need to have to sort of retain their clients? I would say there has been huge mobility, but there always has been. It's just manifesting itself in a slightly different way. In few of the relationships, this is very much kind of a, as always, and certainly obvious, is that the relationship is key. The irony is that we tend to do more for them when they've left the UK or broken their UK tax residency when they're here. That's because we're looking from an investment perspective or planning perspective, especially if it's multi-generational. Actually, not only the shackles, we should apply when their residency in the UK are released. Again, we look at the other days that the business continues to grow disproportionately each year. If we were to be running a purely domestic business, I think we'd be more concerned. But as Gamel mentioned, 90% of the parties already has interest in these two jurisdictions. We've been doing this the other days that if you look at where those parts have interests, I think it's in 92 different countries globally. Although we English lawyers, we're here the London, the still and the advisory hub, all the advisory services are still coalesce, around the individuals. Therefore, they still come here to seek the advice, even if it's advice in relation to something which doesn't necessarily have a UK direct nexus. What have those destinations been then, Gamel? Is it Milan? Have you seen a lot to Milan? What are we missing here? It's exactly what you articulated. I know a big reveal here. It's as you'd have seen and reported on. Definitely Milan. We've seen all the Dubai, some Switzerland. I mean, there are other jurisdictions around the edges, but those are the core and I would say particularly for a certain set of global that we've had before, potentially with US links. Italy and Milan were a particularly attractive destination for them. Then Dubai, Italy's been hugely popular in a simple regime to plug into Dubai, as grown, it meant to be over the last decade, but particularly the last few years, and turned into different jurisdiction where rather than being as transitory as it was in terms of advisory network and individuals that were moving there, it's a lot more stable. Us having had a presence in Dubai for quite some time now, and particularly the last five years, really building out that office as met that we were perfectly placed to service that movement. What have been the key drivers? There's obviously been a complete overhaul, hasn't there been a non-dom regime? For example, increasing carried interest on private equity partners and the likes, hikes and capital gains tax. Is it all of that? I think you've got the recent slightly more stringent. And what I would classify with that is, in non-dom changes, carried interest. But in reality, this extra started probably about five or six years ago. And when there was an element for those who were still in employment, especially as business people who do quite well in the finance industry, where in a post Brexit, well, they could see that the regulatory restraints had to also their bases. And so, the smart money and not necessarily become the institutional, but the hedge funds, all the private equity started diversifying out and setting up corporations throughout Europe. And in my mind, that was probably starting. It was post Brexit, they'll be sort of at migration. I think it's now accelerated because at Milan's a great example. So obviously, it's much touted about the fact tax regime in Italy. But I first relocated to somewhere there two years after the fact tax regime came in. And he was bemoaning the fact that he was in purgatory. I mean, I did point out it was optional, although it wasn't a kind of a four-stakes, but it was tax weeks had lunch or dinner with him last week. And this is a few years down obviously later. And he goes, it's great. You know, I'm buying a house here. All my friends are here because effectively, there's been a massive migration. So it becomes self-fulfilling. And you know, to a point about it is not so, you know, understanding that the steps of their private jetkilling are bad, should leave the country. It's been a gradual migration over time. There's definitely been an acceleration over the last 18 months, but I would say probably the serious money had already gone through four years ago, or and they're just adjusted their lifestyles so that they would then the statutory residency rules. But it was probably, I would say, noticeably, post-Brexit and about four or five years ago, I saw that the international families began to get it. And look, from, you know, does that kind of worry you, Gabriel, about, you know, maybe the direction that the UK is headed when we see all of these net contributors, essentially, sort of leaving? Yes, I mean, look, I think we have a big issue, politically, I think we've got a big issue in terms of attracting talent into the UK. We've got an issue around business regulation. I mean, I was using example people made a degree, but we're in California then the last year, which is in the private wealth network there. And California, a very expensive state really to live in from an income perspective, or from a tax-paying perspective. But they still have a huge migration of talent and people, and all trying to words wanting to live there mainly because of lifestyle, but also business opportunity, being some way that feels like even now with the kind of slight dampening of the tech and AI bubble over the last year, it's still attracting a lot of talent and people want to be there. Now London still got that big lifestyle draw. So the lifestyle piece is there, but post-Brexit, that heavily hits the UK PLC, we've now got the sort of Labor government which may or may not have done some good things, but none of the rhetoric when they came into government around helping business and regulation has come through, actually it's the opposite. So that has not changed anyone's mind, and then you add to that the personal tax element of the changes, and it just doesn't add up to attracting talent, either in the short or long term. There's some hope, there are some green shoots, I guess, there's still the opportunity for probably younger entrepreneurs who want to spend a few years living in the UK and London and setting up a business, you know, the tax regime sort of works for them, but it's not a long term prospect, and that's my concern going forward. So maybe not good for the treasury, but good for law firms, it sounds like if you are in the right jurisdictions and covered the right type of work, then yes, agrees. Just a quick break to hear from Define Lee who are supporting the podcast today. Define Lee is the fastest mover in a legal drafting tools market with data from skills and legal tech hub showing the strongest year on year gain in user engagement. Design for control and built for lawyers working on complex contracts in word, it's specialist tools help you maintain context and flow, and surface the ripple effects of changes, reducing review time, standardizing quality and mitigating risk. Book a demo and discover why Define Lee is trusted by over 150 leading law firms and in-house teams at Define Lee.com/non-billable. Can you give me a little bit of a flavor of some typical instructions that you might work for for some of your private wealth clients? I mean, Taylor, I think Fannie Mastie has a very good, doesn't it? Private equity practice, very good in early stage investment work and things like that into companies. What sort of instructions do you typically get? I would love to say there's a typical instruction. It ranges across the service line. So on a PC basis, we see a lot of intergenerational, well publicised wealth transition, but actually some of the job keys were quite strong, particularly in the Middle East. We're doing a huge amount of working relation to intergenerational planning. LinkedIn with that is a rationalisation of the asset base. So maybe a patriarch or a patriarch is acquired a hot-potch of international assets as they diversified after the region. We got everything from a perfume business to a pen business. It was very much acquired because the individual client liked the product. Whereas now we've got a second and third generation who are looking with a very kind of a slightly more institutionalised investment attitude. Therefore they're concentrating back to the core assets, looking at more conventional asset allocation. Then moving on from there, the transactions in their private wealth space, it's well publicised. The world-dial disposal to Netflix, that was a transaction which we revolved in part because I actually won the trustees on the dollar-states. Remind me of the size of that one. That was big, wasn't it? Reportedly. It wasn't publicised. Therefore I can't remind anyone what the transaction was. I think there are some figures out there that I've seen, but it was a transaction. I think there's definitely a very widespread on the figures. It was a very meaningful transaction. I would say it's under all the trends and things and we see it under the instructions. Definitely, I think an institutionalisation of how the wealth is structured and the mindset that people are bringing is definitely a trend where you see it. From a fine arts perspective, you see that play through in terms of where as traditionally you may have well had a simple loan to buy a company or an asset now actually, families and individuals are looking to be lender side potentially, or if they can't get it on the equity action, then maybe they're coming in to provide measuring debt or preferred equity debt. If they like a particular structure, it's flipping things around and the reason they're doing that is simply, in my opinion, because it's a level of education and financial education, usually from the younger generation that's coming through. Also, I think if the wealth was made in Gen 1, Gen 2, Gen 3 are part of a co-op generation where they're talking to peers in the market that are doing similar things and they have peers that are advisors and are looking internationally, they have a big wide international connection. A lot of that US mindset investment, I would say, I see within the London market, particularly across real estate and finance and also in emerging companies and corporate tax place in particular. So, don't get stuck back a little bit then, guys, how big is the private wealth practice at Taylor Westing soon to be Winston Taylor? But let's talk about it in the context of Taylor Westing. How big a percentage of overall revenue is the business? Because it is a core business line, as you said. It's one of the four core focuses of the existing firm, it will be a firm going forward. And that sort of, I guess, gives you an indication of the value that it has to the firm. And also, it's a quarter then, Gabriel, is that right? It's only more than quarter. The statistics suggest that about 35%, if you basically looked at this and said, these are the clients who are doing work for who fall within the pro-world practice. So I suspect in its next voyage is probably larger than you might find in the figures, but yes, it's a substantial piece of third of the buy. And Taylor Westing is known, one of the top practices in the city. How do you see the practice versus the other top players? So I often think about, you would think about McFarlane's, for example, you would think, perhaps more similar to Taylor Westing, given the international breadth, but someone like a Charles Russell speech, how do you try and position yourself in the market? Well, service, complex in international. And much is I hate to admit that we have competition. And it is a relatively close-knit community in the pro-world space is, given myself, gives them commentary about where the holes are in respect in the competitors offerings. So you know, from a very generalised position. position. The Charles Russell I would say is probably more of a private client business or bit. They're definitely building out the white private world offering. Look, McFarlane's are, I would say, more akin to a private world business, but there's strength not wholly to similar to ours in the financial services sector and in the Middle East, but they don't have the international network. And, you know, say for the, since being newly opened, Rep Office in New York. So, if I'm looking at the firm, so I think I've got a true private wealth offering. I would say, and that's not over dominated by a private client offering. There are probably put us in the funds there. It's probably as a as a fund balance. And Gabriel, you know, are we moving to a world where we will see more, you know, full service commercial law firms potentially looking to offer, you know, private wealth services? Because it, you know, the whole institutionalization of the space sort of hints at that, doesn't it? It's probably too far. I think one is the market and the growth, the growth in wealth and the type of transactions that that private wealth are involved in means that it's going to touch more areas of law across the future of the station. So I think naturally, even if you are a smaller law firm, you will then be picking up pockets of work in that space just because that space is growing. That's not really a place you want to be if you're looking to grow revenue or a practice area, but I think there will be more work naturally for all firms in this space. And also, more, more, more firms are live to the fact that this is a space that may be they're not leaning into in the same way. You know, I think it's not something that you can create overnight. And if you do, then it lacks credibility. So I think people, you know, firms and nicks, reference and the details now earlier, those players that are in the market already are very much further up the curve. But yes, I think we'll see more work, but it would be the one, the players that will really take, take all the opportunity, the ones that can service at that global client base across the core jurisdictions. And that's really what I think is going to set the private wealth, like as far firms apart over the next few years, you know, can you service US, UK and Europe and Middle East, you know, can you structure those with the investments and what's required across those core caps and corridors, coherently. And as a single firm, actually, the answer is not many people can do that in a private wealth space. And obviously that was a long held kind of, but you can ask us to how we do that at an international level. What does it take to win a client in this world versus a typical sort of corporate client? Is it a lot more personal? Yes, I mean, the vast proportion and most say vast proportion of high 70s, early 80s, percent, coming from Planter, Converferral. And this is at the top and where, you know, it's a very, very close to the community. The remainder tends to come in from the intermediary market, but actually in relation to the Cliento Club Referral, it's incredibly common for the clients who have gone out into the intermediary market to go into their bank as they're counting to get an endorsement. And so this is pretty rare, although I've noticed there has definitely been a change over the last two or three years that you're actually, you're competitively pitching as compared to a more mainstream corporate environment. All bit, I have now seen, say over that time period, I just mentioned, probably one in 10 jobs is now competitive, pitch. And it's not kind of an AI-generated mass market to a physical firm. You know, you pretty much know straight away, but you are against. And a lot of these clients will have their own in-house legal teams as well, right? And pretty small normally, but they do. Yeah. So I mean, that's something I see increasing. And which is no bad thing because again, it raises the professionalism and raises the bar in general. But you've been large. This is still a relatively tight-knit global community. Cool. Good stuff. Look, obviously the firm is, you know, when this goes out, but either the merger will be live or perhaps not fully, we'll see. But the firm is about to merge with Winston and Strong in the US. This is a huge moment for Taylor Westing. When it was announced, the IP aspects were certainly played out. And there seems to be some really strong kind of synergies there. The private wealth bit, I didn't hear so much about because I'm not sort of too clued up on whether or not, you know, Winston and Strong sort of practice in that area. But presumably Winston and Strong does have a strong private client practice as well. Traditionally speaking, US law firms are big on strategic IP as Winston and Strong is litigation and corporate. So naturally, those are going to be the focal points and what you look at the full service law firm like Taylor Westing, usually those are the points that are going to automatically. And also the general press around US, you came there, just tend to focus on the core angle and sometimes corporate tech, but private equity are always key. So two things. One is private wealth as Winston Taylor is going to be one of the core pieces going forward. So that's quite a big message from the joint firms. The reason why I see the more compelling sort of message to the market is the fact that it's Taylor Westing's existing private wealth platform that's really going to carry that to day one because Winston Taylor, Winston and Strong don't have a sort of private wealth, go to market as a private wealth firm, which makes sense for how they've been structured to date. What we found though, because the opportunity in the US is huge. If we can, you know, add that to the existing sort of market leading platform that Taylor Westing already has from a private wealth perspective, that that is really going to be top notch, probably unrivaled, offering if we can make it work. Now from having really spoken to a number of partners across the different offices in the US, what it turns out is that they have incredible credentials in the private wealth space and connections. It's just that it's not packaged up as part of a private wealth umbrella. It falls within their existing structure in terms of their service line. So folding that into our private wealth umbrella, I think is going to be easy based on the credentials and the experience that they already have on the ground. But to your point, we need to make a bit more noise about the fact that it exists and that combined platform using the knowledge that we've had and created and putting that into the US market is going to take a bit of effort, but with the opportunity that's there, it could be, you know, it's a huge opportunity for us. So this is one of the big assets that Taylor Westing is bringing to this combination for sure. It's one of a number of assets, but I think the they recognize that there's a lot of complementary assets or skill sets or specials, he's depending how he defines it. And so, you know, it's a bit like a bend diagram. You've got the core and the more you unpick the core throughout the due diligence process, the more the bigger you realise it is, but actually then you realise that you've got other specialists to elements. So, I mean, IP, it gains a very, very broad church and actually over the period of discussions and negotiations, it's become clear that there's certain elements of IP which we're very strong on, certain elements are very strong. So, you know, from a private wealth perspective is that and it's a very crude and not an analogy, but they've got an amazing distribution because, you know, you look at their plant-based and you know, give them myself spend a lot of time, you know, through educating partners, explaining what we do. And, you know, pretty much, you can almost kind of see the light bulb going on, saying, well, when I've got X, Y, Z, and we're saying, I think you're well, you know, that's kind of Forbes 10, that's kind of Forbes 20. And you say, what are you doing for them? We can't look after all our legal needs for them. And then when you actually translate it, say, well, that's effectively what a private wealth practice is, you know, they think, well, what way do a whole bunch of that? But they've just never formulated it as such or never gone to market in that way. And for Taylor, Westings clients, then presumably, you know, they have been asking to now, you know, can you serve as self-properly in the US? And now you can say, yes, we definitely can. Yes, I mean, I think that, you know, we often talk about this, is that if we look at our geographical strengths, obviously Europe, Middle East, and the US, and so, you know, the capital corridors of capital flow corridors, you know, you basically get the triangle there. And, you know, there's no firm for pure private wealth perspective, and there's not kind of talking about the book, but actually, you know, it's been kind of realistic about the analysis in the market, is that no one's actually kind of captured that. Obviously, from an institutional perspective, it's in a number of it's highly competitive field, especially in the New York London corridor, but actually from our private wealth perspective, bearing in mind the interjoggy investment and movement of capital, both actually and human. It's a huge opportunity. So in other words, Winston Taylor should be the first that's able to truly sort of join up and have that proper transatlantic offering to private wealth clients. That's the ambition. Global platform of choice, right? That's what we like to hear. I think that's the big headline from from the podcast here today guys. So I guess next step for both of you will be spending a bit more time in the US, is that right? Yeah, even more time. Even more time. Yeah. Okay, good stuff. So, okay, yeah, the sounds really exciting, guys, and we'll be watching closely. So best of luck with the merger. I hope the integration goes really well.