- Dentons, one of the biggest law firms, is launching a consulting firm with private-equity cash.
- Dentons Global Advisors is starting by buying the Albright Stonebridge Group for an undisclosed sum.
- The new consulting firm hopes to compete with McKinsey, BCG, and parts of the Big Four.
- See more stories on Insider’s business page.
Dentons, one of the world’s biggest law firms, is using private-equity money to create a new consulting firm, starting with the acquisition of an advisory firm founded by former US Secretary of State Madeleine Albright.
The consulting company, called Dentons Global Advisors, or DGA, will be led by Ed Reilly, the strategic-communications executive whom Dentons hired from FTI Consulting in 2019. The law firm will have a minority stake in DGA, which has financial backing from an unnamed private-equity firm, Reilly said in an interview.
The cornerstone of the new venture is the Albright Stonebridge Group, a Washington, DC-based consulting firm led by the US’ former top diplomat. That firm, to be rebranded Dentons Global Advisors ASG, has advised corporate titans like Pfizer, Amazon, Microsoft, Lyft, and Discovery Communications and has at least a half-dozen alumni serving in the Biden administration.
ASG describes its services as “commercial diplomacy.” Its staff includes policy experts, former corporate executives and lawyers who advise on strategy, regulatory matters, and public affairs. Albright, who led the State Department from 1997 through 2001, is “committed to staying with us,” Reilly said.
Joe Andrew, the chair of Dentons, said the new venture has plans to build one of “the most sophisticated consulting firms in the world” that can compete with the likes of McKinsey, the Boston Consulting Group, and advisory units of the Big Four accounting firms.
“What we’re attempting to do here is build an enduring institution that will stand beside Dentons,” Reilly said. “A strong partnership and relationship, yet independent.”
Dentons’ minority ownership in Dentons Global Advisors is unusual
Some law firms have consulting units that dispense nonprivileged business advice. Many others also offer crisis-communications advice to clients who want to be sure they don’t slip up in their communications with policymakers, courts, regulators, and the public.
But law firms typically employ those consultants outright, fully own a subsidiary, or hire outside crisis-communications pros. It’s unusual, if not unprecedented, for a law firm to take a minority stake in a consulting shop using outside money.
Michael Warren, ASG’s managing director, said moving under the Dentons umbrella would give clients of the law firm and DGA the benefit of having lawyers and business-strategy specialists in the room with corporate leaders at the same time. Executives face “complex issues that are very, very difficult to pull apart,” he said.
ASG has more than 100 people on staff in the US, China, and other countries and dozens of other experts who assist from time to time, according to Dan Rosenthal, its chair. He said the consulting firm’s revenue was higher in 2020 than it was in 2019 and that it was careful and deliberate in its months of talks with Dentons.
“Our reputation is our most important and valued asset, and we didn’t go into this thing lightly at all,” he said. He said ASG’s executives would be “substantial owners” of DGA.
This is not Dentons’ first venture into communications and consulting
Dentons has gotten into comms and consulting before. In 2013, it created a crisis-management consultancy known as Wirthlin-Dentons. In 2015, it founded Nextlaw Labs, a legal-technology accelerator, and expanded the Nextlaw brand to encompass a venture-capital entity and legal and public-affairs referral networks. And in 2019, it created Dentons Risk Consulting, though a legal-news website reported in March that the project was no more.
On Thursday, Dentons said it was restructuring its Nextlaw offering. A spokesperson said parts of the Nextlaw Public Affairs Network could affiliate with DGA. Andrew said in an interview that a final decision hadn’t been made on which Dentons assets would move to DGA.
“There’s a certainty that some of them will,” Andrew said.
Dentons, which was formed in 2013 by a law-firm merger, is structured as a web of partnerships that employ 20,000 people, according to the firm. It has recently engaged in “combinations” with other midsize US law firms that serve cities like Louisville, Kentucky, and Des Moines, Iowa, where few global law firms have offices, in an effort to extend its reach.
It has also grown internationally in the past year, adding law firms in Ecuador, Tanzania, and several other countries. Andrew said the law firm’s stake in DGA will be held by a Dutch entity that manages Dentons’ inter-entity payments.
Law.com put Dentons’ 2019 revenue at $2.9 billion; the firm said the number wasn’t accurate and said it doesn’t release its revenues. Two units whose finances are public, Dentons UK and Middle East LLP and Dentons Europe LLP, respectively reported $328 million and $561 million in revenue in their most recent fiscal years at current exchange rates.