Schulte's hedge fund clients alone could stretch to the moon and back (probably).
THE year 1969 was noteworthy for all sorts of reasons: Richard Nixon swore the president's oath, The Beatles recorded their iconic Abbey Road album in London, and Neil Armstrong took a man's first step on the moon. Over in New York, meanwhile, seven young men (all under 35) were taking their own giant leap by leaving their law firms to set up a new one. Today, Schulte (pronounced shultee) is one of the top legal advisers for investment management work – representing nearly half of the 100 biggest hedge funds and over 3,000 investment funds worldwide. It has around 360 lawyers spread across offices in the Big Apple, DC and London.
Chambers USA confirms this reputation by awarding Schulte a top ranking nationwide for its investment funds prowess. It also gives decent marks to Schulte's capital markets, corporate/M&A, bankruptcy/restructuring, real estate, and tax practices, and recognizes its expertise too in white-collar litigation and government investigations. Executive committee chair Alan Waldenberg tells us that “we’re not trying to be all things to all people. Instead, we have a successful spot in the market representing clients we genuinely like.” Speaking of clients, notable customers include Cerberus Capital Management, Veritas Capital and Credit Suisse.
Most juniors join the New York base, although at the time of our calls there was a sprinkling of associates in the DC branch. The latter comprises around 20 attorneys in total, most of whom are litigators working on either securities matters or white-collar defense. Associates usually submit status reports to indicate availability, and also get work via “informal relationships that you've built up.” In investment management, “we have two assignment partners, one for juniors and one for seniors, who look over our hours to make sure we're not lagging behind. But we're also usually assigned a client and we stay with them for our tenure at the firm. It's great because we get to build institutional knowledge and trust.”
“You have to keep on top of so many things.”
Investment management “is the place to be at Schulte,” some here proudly felt. “There's a small compliance subset in the group, but associates mostly get a good mix of private equity and hedge funds.” Expect to work “on everything from handling fund-raising, launches, drafting fund documents, managing requests from investors, drafting partnership agreements, and interfacing with counsel over in the Caymans.” Other insiders told us that “you feel like the quarterback because you have to keep on top of so many things.” There's also a managerial element, “because when there's a fund launch you have to make sure you've got all the proper documents drafted according to the correct terms. It's very intense.”
Litigators told us: “In your first year, you spend a lot of your time doing doc review, which is kind of typical.” As associates progress, they get more responsibility, and DC sources told us they get high responsibility from the get-go. Regardless of location, meaty associate tasks included “second chairing depositions, liaising with clients to prep for trial, and getting exhibits ready.” White-collar work sometimes requires international travel.
Associates in the M&A & securities group get stuck into “a lot of contract review.” However a common theme across all departments was that because of the slight deficit of mid-level associates, younger lawyers get thrown in pretty early on. “The firm has a great recruiting team and has taken on some good associates; the problem is retaining them. But because of this I've transitioned to higher level work.” This has seen corporate sources “doing the initial drafts of sale and purchase agreements, corporate governance documents, and ancillary and contribution agreements.” Over on the shareholder activism side (where shareholders of a publicly traded company use their position to bring about change), insiders had “drafted all notice and proxy statements and press releases. Activist work allows you to get client contact really early on.”
Training & Development
Incoming juniors gather in New York for a week of initial training that covers “general orientation, IT, and how to research and email properly.” Training then becomes more specialized, with most groups running monthly sessions on case law updates. Recent topics included “the 9th Circuit arguments on the immigration ban.” While corporate newbies were instructed “in how to close deals and write opinion letters,” litigators had a more interactive experience: “In the summer we had a mock trial. It was my favorite bit of the program. The firm hired people to play witnesses and we had a jury which we could watch while they deliberated to see which bits of our advocacy were the most effective.”
General mentoring could be better, we heard: “It's a struggle to know who to ask questions to. With seniors, sometimes I feel a bit like they're over the whole thing.” Formal feedback is given in the annual review, “where you fill out a form evaluating what you've worked on and who you've worked with.” The reviewing partners then collect comments from the supervising attorneys and present the reviewee with conglomerated feedback.
“I never envisaged myself liking private practice,” one associate confessed. “I thought I'd do it for a few years and then look elsewhere. But now that I'm here I don't want to leave, purely because of the people. I like all of them and not just in a casual 'say hi' kinda way, but we're actually friends – both partners and associates alike.” Other echoed these sentiments, although a few mentioned the camaraderie “can cool off” among some seniors. Corporate sources said “there's group lunch every other Friday and the occasional happy hour.” In DC, “there's a drinks fridge and every couple of Fridays a partner has an open bar in his office. You can go over there and drink the type of whiskey that I can't justify buying on my salary!”
In terms of career progression, juniors felt that “the party line is that no one makes partner. The opportunities just aren't there. I think it's possibly because we're a smaller firm, but it does affect your plans for the future because you start looking at different options sooner than you would at other firms.” Chair Alan Waldenberg tells us that “there are fewer opportunities for new associates today than there were when I started in 1978. Having said that, we’ve really focused on increasing opportunity. Last year we made a 5% increase in the partnership because we understand that unless we create the opportunities, people will leave, and we need new and young lawyers. They’re the life-blood of this firm.”
Since early 2016, the NY HQ has been undergoing a huge revamp. “We're about half-way done right now. It's completely different and very modern. It's all glass. Even though we still have wooden doors there's less privacy. At least it's very, very pretty.” New Yorkers have to share digs in their first and second years, which they liked: “I really appreciated having someone to ask questions to and get a lot of info about the firm.” DC was refurbished a few years ago and now everyone has their own office. “For a while it was really noisy because they were rebuilding the Washington Post building next to us. It's a lot quieter now and they're turning it into a shopping center with a beer garden, which I'm sure we'll go and use.”
Hours & Compensation
In order to be eligible for a bonus, associates need to hit 2,000 hours. Up to 200 hours of pro bono, marketing or recruiting work can count toward the billing target. “I would like the target to be less, because you can be hurt by one slow month. Sometimes work can be cyclical so it's the luck of the draw.” We heard that M&A has been a bit slower recently, and in August 2016 "the co-chair [John Pollack] left for Gibson Dunn.” Others thought that “the uncertain political climate might be the reason why not as many deals are going through. Who knows!” However, in other departments it was full steam ahead. Some had worked “until 11pm every night for the past three weeks.” Thankfully, “if you're burning the midnight oil they realize you need to catch up on sleep at some point. They're also pretty respectful about giving you two weeks uninterrupted vacation if you've been working hard.”
The first-year salary was raised to $180,000 – “it's competitive, I mean we're at market.” Bonuses are dependent on hours and increase by $10,000 increments for those who clock up 2,300 and 2,500 hours. “They're quite transparent, they send emails telling us what the bonus scales are. But my problem is that it shouldn't be based on hours. It should be more on quality and other factors that make good attorneys,” some opined.
Like much of BigLaw, “it's not particularly diverse. When you walk down the hall, it's mostly white people, although I know they're putting an effort into recruiting.” One theory why ethnic diversity wasn't better was that “our clients aren't Fortune 500 companies who sign pacts with each other to hire law firms with good diversity goals. Our clients are mid-market and aren't as diverse themselves, so it doesn't really play much of a role.” Others suggested that “it feeds into why we don't have many mid-levels. When there's no one to mentor you who's also diverse, it's understandable why people leave. But we know that a lot of other firms care even less.” The firm points out that a lot of attention and resources are focused on diversity right now, and the past two summer associate classes have been the most diverse ever at around 40%. Also, the most recent partner promotions included an Hispanic male and two Asian female attorneys, “which was a shock, because not only are they women and Asian, but one of them is also pregnant.”
Female diversity is generally better, and while there are affinity groups for LGBT, black and Asian attorneys, the women's initiative is most visible. “We have women's happy hours and get-togethers to welcome new female associates.”
Schulte appointed Danny Greenberg – who spent nearly a decade as president and attorney-in-chief of the Legal Aid Society in New York – as special counsel overseeing the firm's pro bono program. 200 hours can count toward the billing target, although more litigators tend to get stuck in than transactional attorneys. Tasks have included “writing a brief for a case concerning an anarchist who was attempting to sue the UN for its role in a cholera outbreak in Haiti.” In investment management, “at the moment we've got an associate doing a six-month fellowship at a non-profit. The firm still pays their salary.” This is the program named in honor of former pro bono chair Brooks Burdette, which is open to all associates each year.
Pro bono hours
- For all US attorneys: 12,583
- Average per US attorney: 37
Strategy & Get Hired
“I’ve been on the executive committee for more than 30 years, and every year someone predicts the downfall of the mid-sized firm, and they’re always wrong,” explains exec committee chair Alan Waldenberg. “Other firms get bigger, but we like not having a whole lot of offices. It's so much easier with the advancement of technology to have a global practice right here in New York.” Hiring partner Bill Gussman tells us that “we want bright students. Grades are a factor but not the complete package. We seek out personality and good communication skills.”
Interview with chair of the executive committee Alan Waldenberg
Chambers Associate: What have been some of the highlights at Schulte over the past 12 months?
Alan Waldenberg: We are consistent and stable, because we are very comfortable in our own skin. In 2016, we continued to do what we did best over the last 10 years. We worked on a number of the biggest fund launches last year and were the leads on half the major activist challenges to corporate management. We brought in a lateral partner, Aneliya Crawford, to help build out our core activist work, because it’s exploding. We don’t lateral to start new business, we lateral to build out what we do in terms of our core practices. Last year, we also brought in a broker-dealer group, which fits very naturally with our investment funds practice. This also folds into our white collar practice, because when you don’t listen to a broker-dealer lawyer, you tend to need white collar lawyers. We added to our structured products practice, and that’s been wildly successful for us. We’ve added a leveraged finance practice to complement our existing lending practice. Both of these facets seem to be busy at opposite times, so it was a natural and strategic fit for us. It’s like we’ve remodeled the house, but not changed the footprint. We like doing what we’re good at; we’re not trying to be all things to all people. Instead, we have a successful spot in the market representing clients we genuinely like. It makes it fun to come to work every day.
CA: Where do you see the firm in the next five years?
AW: People are really comfortable with the way they get to operate here, so no one really wants to change how we do things. I’ve been on the executive committee for more than 30 years, and every year someone predicts the downfall of the mid-sized firm, and they’re always wrong. Other firms get bigger, but we like not having a whole lot of offices. It’s so much easier with the advancement of technology to have a global practice right here in New York; there is more opportunity for us to give clients the personal type of work they get from our firm. We don’t hand people off to different teams. Our old-school clients like this especially.
CA: How do you think the firm, and the legal industry as a whole, are going to adjust to the new administration?
AW: I really don’t know. A lot of people are going to spend a lot of time thinking about what’s going to change. Dodd-Frank is an issue at the moment. I’m a tax lawyer, so people are calling me, asking what’s going to change. It might be a little harder to get deals done at the moment because there’s so much uncertainty. For example, people thinking of buying companies that specialize in the importing business might be wondering how they’re going to buy when the president is imposing dramatic changes on imports. But for all the talk on the new administration, they’re not going to stop prosecuting people for doing dumb things. Beyond that, we don’t know.
CA: How would you define the Schulte culture?
AW: It’s easy to have a great culture at a firm our size because we are all predominately in one office, so we all know each other. Starting at the beginning, the summers are amazing and virtually all come back, and if they don’t, it’s usually because they got married and moved away or something like that. But when they do come back, they transition into the rest of the firm with 30 really close friends. People are really close, so it enhances the culture. The partners who are here have been partners forever. Two of the founding partners, Paul Roth and Bill Zabel, are now both 70-odd, but they still come in. The next generation of partners have all been here for more than 30 years, and they’re still really good friends, which shows astonishing stability. ’’
CA: Speaking of the partnership, how would you respond to associates who feel that they want to be on the partnership track, but don’t think there are many opportunities at the firm to do so?
AW: There are fewer opportunities for new associates today than there were when I started in 1978. Having said that, we’ve really focused on increasing opportunity. Last year we made a five-percent increase in the partnership because we understand that unless we create the opportunities, people will leave, and we need new and young lawyers. They’re the life-blood of this firm. We know we need to grow and manage those opportunities. For the past few years, we didn’t make any new partners, but that was not a conscious decision. Now senior management has a laser focus on creating more opportunities for our people.
CA: Finally, do you have any words of wisdom for our readers?
AW: Work hard and keep your eyes open to find something exciting you want to do. Focus on learning as much as you can; don’t worry about five years from now. Make sure wherever you end up, you like coming to work and you’re doing something you enjoy. Success has a lot to do with luck, and there’s no point worrying about what you can’t change, so get in a position now where you can learn and shape what you want to do in the future.
Interview with hiring partner Bill Gussman
Chambers Associate: What is the scope of your recruiting drive?
Bill Gussman: We have a national scope for recruitment, but we tend to focus the on-campus interview process on 15 to 18 top tier schools in the North East, South and Midwest such as Columbia, NYU, Harvard, Penn, Michigan and Duke. We also actively encourage write-ins across the country. We’ve had people as far away as California and Canada. We are planning on a class size of the mid-to-upper 30s, which is consistent with prior years.
CA: What does the firm do to encourage diversity in recruiting?
BG: We have had a strong diversity initiative for many years. For several years we've had consecutively the most diverse summer classes we've ever had. We are actively involved in on-campus student organizations like the Black and Latino Student Association (BALSA), as well as Asian American and LGBT student groups. Our commitment and involvement is year round and very active. Rather than just being a footnote on our website about what we do, we make sure potential candidates know our firm before we actively recruit. A good number of our diversity committee members are involved in recruiting.
CA: What are you looking for in a candidate both in general and in an interview situation?
BG: We want bright students. Grades are a factor but not the complete package. We seek out personality and good communication skills; people who aren’t afraid to keep their doors open or to walk through open doors to get work or to ask for help. We look for people to brainstorm and share ideas with. People use the words “professional informality” to describe us. We're all professionals but we're human too. Law firms can be competitive, and so are we. We do cutting-edge work, but we are human beings who care, collaborate and are genuinely interested in each other.
For an interview, I would encourage candidates to show enthusiasm and interest in actually practicing law at a firm through words and body language We’re looking for a good match on that basic level, even before we get into the specifics of your qualifications and personality. Speaking too negatively about previous experiences you’ve had, whether in academics or prior work, would constitute a red flag. We look for people with positive energy.
CA: What can students do now to prepare?
BG: The candidates we call for interviews are excellent law students who know the material and who are highly focused. Be aware of the leading and foundational issues in finance. Try to show a particular focus on finance, private equity and the hedge fund space. It would be helpful if students read the financial press and international news to understand the context we practice in and not just the legal issues. We want people with sensitivity and an understanding of what is happening in the world.
CA: Can you briefly outline what’s on offer in your summer program?
BG: We are consistently one of the highest-ranked summer programs. I participated myself, 21 years ago. The program is about real work. There are two rotations through two departments; for example, participants may spend half the time in corporate and the other half in litigation etc. We are flexible if they want to experience different groups. We give participants outstanding training and run mock negotiations or leveraged buyouts, led by attorneys at the firm. There is a popular mock trial option, in which actors play witnesses. Serious work underlies everything, but the program is a lot of fun, too. Overall, the summer program provides participants with a valuable chance to get to know attorneys at the firm and vice versa, so we can all test whether it’s a good match.
CA: Are there any words of wisdom that you can give to our readers?
BG: Go with your gut. Don’t just follow what might be viewed as the most popular area of work at a firm. Get to know peoples’ practices, and remember the law is in large part about relationships. Get to know lawyers personally to see if you fit in with the firm culture. Deep in your gut will always be the right answer, so just go with it.
More on getting hired
“We see so many resumes. So be strategic and do what you can to stand out by showing us what you know about the firm,” advised sources. They continued “find out about our market, our practice groups and network with people. Now is not the time to be bashful. Find people who are friends of friends who can give you a proper impression of what differentiates firms.” The powers that be further substantiated these nuggets of wisdom. Hiring partner, Bill Gussman says that “for an interview, I would encourage candidates to show enthusiasm and interest in actually practicing law at a firm through words and body language. We’re looking for a good match on that basic level, even before we get into the specifics of your qualifications and personality. ” Beyond that, it's the usual criteria that sees hopefuls through the interview process. Gussman explains that “grades are a factor but not the complete package. We seek out personality and good communication skills; people who aren’t afraid to keep their doors open or to walk through open doors to get work or to ask for help. We look for people to brainstorm and share ideas with.”
Schulte Roth & Zabel LLP
919 Third Avenue,
- Head Office: New York, NY
- Number of domestic offices: 2
- Number of international offices: 1
- Partners (US): 89
- Other lawyers (US): 253
- Summer Salary 2017
- 2Ls: $3,462per week
- 1Ls hired? No
- Split summers offered? No
- Can summers spend time in overseas office? No
- Summers 2017: 38
- Offers/acceptances 2016: 38 offers, 37 acceptances
Main areas of work
Our specialties include bank regulatory; bankruptcy and creditors’ rights litigation; broker- dealer regulatory and enforcement; business reorganization; complex commercial litigation; cybersecurity; distressed debt and claims trading; distressed investing; education law; employment and employee benefits; energy; environmental; finance; financial institutions; hedge funds; individual client services; insurance; intellectual property, sourcing and technology; investment management; litigation; mergers and acquisitions; PIPEs; private equity; real estate; real estate capital markets and REITs; real estate litigation; regulated funds; regulatory and compliance; securities and capital markets; securities enforcement; securities litigation; securitization; shareholder activism; structured finance and derivatives; tax; and white collar defense and government investigations.
Schulte Roth & Zabel is a premier law firm serving the financial services industry from strategically located offices in New York, Washington, DC and London. We take a multidisciplinary approach in our work with a large and impressive array of global and forward-thinking institutional, entrepreneurial and individual clients, from advising clients on investment management, corporate and transactional matters, to providing counsel on regulatory, compliance, enforcement and investigative issues.
• Number of 1st year associates: 32
• Number of 2nd year associates: 24
• Associate salaries: 1st year: $180,000
• 2nd year: $190,000
• Clerking policy: yes
Law Schools attending for OCIs in 2017:
Boston College, Boston University, Cardozo, Columbia, Cornell, Duke, Emory, Fordham, George Washington, Georgetown, Harvard, Howard, Michigan, NYU, Penn, Tulane, Virginia, Wash U
Summer associate profile:
SRZ hires attorneys who are bright, personable and enthusiastic about early substantive responsibility and client contact. We seek candidates with outstanding academic achievement, high motivation and strong interpersonal skills.
Summer program components:
Our summer associate program allows students to receive substantive assignments from practice groups of their choice during two assigning periods. Summer associates have interaction with our clients, attend meetings and depositions and work on complex projects. Training and feedback are emphasized through regular departmental training sessions, a writing seminar, a corporate negotiation workshop, a trial advocacy program, and a pro bono week. These experiences are all designed to allow students to explore various areas of interest, get immersed in the firm culture and gain first-hand knowledge of what they will see as a junior associate. In addition to our top-notch training programs and hands-on work experience, we offer fun and exciting social activities that allow summer associates to spend time with their associate and partner mentors, develop relationships with our attorneys and get to know everyone outside of the office.