Capital Markets isn't taught well in colleges. Looking forward to any advice for an incoming associate (at a Tier 1 firm, if that matters) on how to get a good grasp of the capital markets world and understand the complexities involved. Would be grateful if seniors could mention specific websites/ topics to read up on. Tips to adjust to law firm life would also help.
Cap marks cannot be sold It is the worst practice area .The main role of Indian lawyers is to draft the non business sections of the offer document. The business sections of the offer documents which include risk factors are drafted by the ILC on the deal. The business sections are heavily influenced by the opinion of bankers on the deal. The DLC only gives comments on those. No one can deny the fact that the job of Indian counsels from equity partner to A0 is very clerical. The offer document is essentially a due diligence report. The partners comment on this due diligence report. Capital market lawyers know very little law apart from certain schedules and procedural provisions in the ICDR. It is a myth perpetuated by seniors that only first three years are bad. The entire life cycle in the team is bad as seniors essentially review clerical stuff. There is very very very little application of black letter law in cap marks. Also, the working hours are worse than any other team and people who do 40 per cent of the amount of effort cap marks lawyer put in get a higher bonus in some cases. Working hours are really bad and the work is mind numbing.
Take up capital markets if law is not the only thing that excites you. If you like understanding financial statements and management studies as well as knowing and applying law, you can take up capital markets.
It’s unfair to say capital markets is all about diligence. That’s how it seems in the first three years in any transaction execution driven practice area (yes, even litigation practice involves due diligence). But once you go beyond that three year threshold, you are exposed to the interesting part of capital markets. The structuring of the deal (yes, IPOs need structuring too - come and see in the Tier 1 firms), the positioning of the Company in the market, the smart drafting of the risk factors, the MD&A discussions where you almost feel like an auditor and of course, the sheer challenge and/or pleasure of guiding a team of 12-15 set of consultants / bankers / intermediaries.
The client interface is so high that cross-selling is actually a cake-work.
The con is, of course, the cyclical nature of the practice. Either you have very low work (wondering where the bonus will come from) or neck deep in work (wondering where is the time to spend that bonus). The working hours will be very long in the first 3-5 years. Very few survive behind this threshold of 3-5 years. If you do, you will see the fun part of the practice and perhaps relish it too.
Truer words have not been spoken. Completely agree with whatever the Dude has said. Cap marks is by far the worst worst and most clerical practice area. Copy pasting management profiles, preparing back ups for bankers is the absolute worst kind of job. It is definitely definitely not lawyering. The Dude has called it. The job only exists because bankers do not want to do this dirty job. As an experiment, firms can hire 18 year olds who have just left school as interns and compare their work with 23-24 year old young lawyers. I feel there will be no difference in quality. A law school education is not required for capital markets. The worst part is there after 1 year, there is nothing new. The offer document is essentially the best it can get. The worst part is that junior partners often just review the work of juniors and offer broad level comments on the offer document. The meaty part of the offer document is also drafted by foreign counsels. Also, negotiation in capital markets is about backups. Eg- If there is a director who is an IAS officer, will his record in the DOPT website will suffice, whether degrees provided are matching with the description in the offer document. Bottom line- These are not lawyers. No one from equity partner to A0 practices law in cap marks, They are clerks to bankers and do their dirty job which no one wants to do.
Point taken, that a Corp Associate will know more Company law than a Cap Marks associate. But isn't that's a given considering the Corp Associate does Company law as her bread and butter? As to your point about legal depth, it really depends from transaction to transaction. There are challenging legal issues in cap marks transactions too, albeit it might be true that most transactions will be similar. Again, it totally depends on you, whether you think being a better lawyer, or for that matter, a better professional involves you knowing the black letter law or knowing the law enough but also being able to advice on the basis of commercials. The finance bit and client facing makes one a well rounded professional, IMO. Also, Cap Marks isn't just ICDR (read equity). The bit about clerical work for young associates is correct. You need to be on top of your game while drafting. At the same time, I would like to think its the same in any other corp practice as well, however the degree may vary. If you want to do something, do policy work but if you want to take the next unicorn public (and do some clerical work for it), do Cap Marks. Cheerios.
1. If you are in it for the money, try to rotate out to another practice area early on. (horrible bonus compared to peers) 2. ..... i have nothing else.
This is the most templated job profile in the market - more that debt financing even. Nobody goes to law school, thinking they will draft profiles for directors, summarise litigation, and explain to your company how 25 other entities (that are not even in the RPT) belong in this special list SEBI has created because well they f***kin can. I mean you are literally doing eligibility checks, making sure everything not from KPIs is being backed up, and also creating secretarial backups for bankers.
I said it here first - Capital markets legal practice exists only because the bankers have outsourced the copy past job to lawyers who do it for pennies on the dollar (thx to Kco and other the AMSS split). Of course, partners who do this for long enough become experts, thats another thing. I mean, i just made SA and I still have to scream at this [...] capital markets - every day cause she copies comments from other counsel on the deal on the offer related agreements and sends them, and fights on them because she saw them once before on some other deal from 1 year back.
Can you compare the legal depth of a disputes or corporate partner with that of a cap marks partner. Absolutely not.Cap marks requires a superficial knowledge of finance. Through one has to agree that cap mark partners know more about finance than partners from other practice areas but when it comes to black letter law , he has not seen any of that since he graduated from law school. This is true when we are talking about cap mark deals. But securities litigation is a different ball game. But generally, cap marks people will have the least knowledge of law. Any corporate associate worth his salt will have a more nuanced understanding of company law than a cap marks associate. Cap marks associate only knows ICDR and has an above average understanding of company law (CA 13).
Also, one more point is that in cap marks, there is a lot of pressure to not make any clerical errors while doing only clerical work due to liability issues (misstatement or rather wrong info in offer document). Generally, cap marks is not very attractive work for any person who wants work to be interesting. The work is mind numbing.
It is ignorance or lack of attention to call the practice bereft of any application of law. All corp practices involve similar things. However, what matters is what you bring to the table. Glass half full has already pointed out that its a client facing practice. You need to have those soft skills to back up your work. Just to give you an example of the kind of diligence that is required: You will be required to read case papers of a wide variety of litigations (sorry, legal proceedings :p) that a Company is involved and then have to summarise it succintly in a way that you don't leave out any relevant point. Just as that, you will be going through all details regarding the management and capital structure of a company and then presenting in a compact, easy to understand manner. You need to have attention to detail. Further, you will get a chance to understand the industry of every company that you will work for and also understand the risks that might be there that are specific to the company/industry/country. Not only are required to have the legal knowhow, but also the understanding of the commericals. Therefore, there is no end to how much you can learn and understand. But yes, if you just want to put your head down, do the bloody work and catch the next EPL fixture, you might do that as well (that is if your partner believes in weekends). So it ultimately has some merits and demerits, like any other practice area. Wish you the best.
Most of the tier 1 firms (used loosely) have a practice, so there are opportunities. Even some tier 2 firms have robust cap marks practices, so rest assured you'll have jobs
Better advice is stay away from corporate law. So many enlightened people here will tell you how litigation is the real deal in law and everything else is clerical.
Diligence as a whole is drudgery. But, it's what you get paid to do across all firms and practice areas.
Capital markets requires you to be able to put forth information to the general populace. It is tiring, but if you can see the whole picture from resolution to fund flow, it makes for a compelling story.
Sadly, all corporate legal work requires a degree of word formatting skills and the ability to rely on precedents.
Agree about reading the icdr with DRHPs on SEBI's website, but putting two and two together may require a bit more understanding. Let's leave some work for the seniors in the team to impart as well.
- you learn a lot very quickly. - you will be doing diligence (a lot of it) but can learn a lot from review - you’ll be client facing very early in your career - you will draft parts of the offer document early in your career - wide variety of sector exposure - niche practice - dynamic
Cons - long work hours - precedent driven (unless you read the law and understand why things are done)
Because it is brainless. You have to use your brains mainly in litigation. You need to learn the law mainly for lit. Mostly, capital raising transactions are very templated and repetitive. There is very little application of law. You need excellent word formatting skills, patience and a thick skin in cap marks. But in corporate practice, there is some application of law unlike cap marks and debt finance. In complex corporate transactions, sometimes lawyers do need to apply the law. But mostly deal work is very templated. Corporate advisories are fun but that is not what rakes in money. Drudgery and copy paste is what makes firms tick.
This is very informative. Would recommend that even if you are not able to follow through on all the suggestions above, just familiarizing yourself with a few DRHPs (available on the SEBI website) would be very helpful and leave you not clueless.
You can read the ICDR in parallel. Reading the ICDR standalone and bereft of context can be very dry and not productive.
if you don't like it change the area soon. the more the years pass the more tough it will be to change to anything else. only few firms do serious capital markets at a large level so limited opportunities.
Prioritise health and sleep over everything. You will need both to be a successful lawyer. All-nighter can be anything but definitely not a badge of honour. Don't strive for that. Make 10 mins for yourself. Do a quick stretch everyday or move your body soon after you wake up. Just because it's late night and client or firm is paying for it, don't eat crap - make healthy choices to the best of your ability. A lot of it will not make sense but don't live with that ignorance. Ask if you can but if that would work against you then don't hesitate to approach anybody however it may be to get that knowledge. You will feel frustrated, angry, miserable and even sad sometimes - don't react to it, reach out. These are transitory and will pass. Have a broad end-game in sight. Every day need not be a move towards that but keep it in your consciousness so that you are able to spot opportunities to move quickly and shift to next gear. You will meet all sorts of people - kind ones and cruel ones, develop equanimity in dealing with both. Indian capital markets is sometimes a lot less about law and more about market practice - never forego an opportunity to be in a conversation where that is practice. Observe. Good luck my friend and Godspeed. Last but not least, never bullshit.
Pls read the risk factors before venturing here. The work is dull and clerical at best. Apart from money on par with other colleagues at the firm, there are very little positives. Try another practice area after this and demand rotation or you will inevitably quit. Capital markets in India is never first choice for anyone.
Delhi v Mumbai doesn't really matter, at all. It's all your personal preference. If you have a choice, look up your team members/partners before choosing.
As a Cap Marks associate, there are a few things you can brush up before you join, which will help you in making good impressions while also helping you out once the slogging starts:
1) Get better at MS Word: As a Cap Marks lawyer, your primary job will be drafting/commenting on offer documents. Offer documents are legal docs and need to be formatted perfectly. Learn all the tricks - repeating headers in table, Para spacing, alignments. The more shortcuts you know, it is better as it will save you a lot of time.
2) Become aware of the Cap Marks transactions that your firm might be doing right now: you will necessarily be working on the precedents from these transactions, so it will if you already know the specifics of these transactions.
3) Read up on the types of transactions: equity transactions - IPOs, QIPs, FPOs, etc. Debt transactions: NCDs, international bonds, etc. Browse through offer docs of various types of transactions and try to get an idea of the basic law points.
4) ICDR: These regulations will be your go to for equity transactions, so get an understanding of the basic framework.
5) Enjoy this time off!! :Because once you start, there will be no end!
What should one know/expect before joining the capital markets practice of a tier-1 firm? Is there anything one can do/read up on to prepare beforehand?
Also, does location make a lot of difference in terms of capital markets practice? Which would be preferable in the long term? Delhi/Mumbai?
It’s unfair to say capital markets is all about diligence. That’s how it seems in the first three years in any transaction execution driven practice area (yes, even litigation practice involves due diligence). But once you go beyond that three year threshold, you are exposed to the interesting part of capital markets. The structuring of the deal (yes, IPOs need structuring too - come and see in the Tier 1 firms), the positioning of the Company in the market, the smart drafting of the risk factors, the MD&A discussions where you almost feel like an auditor and of course, the sheer challenge and/or pleasure of guiding a team of 12-15 set of consultants / bankers / intermediaries.
The client interface is so high that cross-selling is actually a cake-work.
The con is, of course, the cyclical nature of the practice. Either you have very low work (wondering where the bonus will come from) or neck deep in work (wondering where is the time to spend that bonus). The working hours will be very long in the first 3-5 years. Very few survive behind this threshold of 3-5 years. If you do, you will see the fun part of the practice and perhaps relish it too.
That one line has sold cap markets to me over gen corp which I've been doing currently as a 4th year student as a Paralegal
1. If you are in it for the money, try to rotate out to another practice area early on. (horrible bonus compared to peers)
2. ..... i have nothing else.
This is the most templated job profile in the market - more that debt financing even. Nobody goes to law school, thinking they will draft profiles for directors, summarise litigation, and explain to your company how 25 other entities (that are not even in the RPT) belong in this special list SEBI has created because well they f***kin can. I mean you are literally doing eligibility checks, making sure everything not from KPIs is being backed up, and also creating secretarial backups for bankers.
I said it here first - Capital markets legal practice exists only because the bankers have outsourced the copy past job to lawyers who do it for pennies on the dollar (thx to Kco and other the AMSS split). Of course, partners who do this for long enough become experts, thats another thing. I mean, i just made SA and I still have to scream at this [...] capital markets - every day cause she copies comments from other counsel on the deal on the offer related agreements and sends them, and fights on them because she saw them once before on some other deal from 1 year back.
Capital markets requires you to be able to put forth information to the general populace. It is tiring, but if you can see the whole picture from resolution to fund flow, it makes for a compelling story.
Sadly, all corporate legal work requires a degree of word formatting skills and the ability to rely on precedents.
Pros:
- you learn a lot very quickly.
- you will be doing diligence (a lot of it) but can learn a lot from review
- you’ll be client facing very early in your career
- you will draft parts of the offer document early in your career
- wide variety of sector exposure
- niche practice
- dynamic
Cons
- long work hours
- precedent driven (unless you read the law and understand why things are done)
You can read the ICDR in parallel. Reading the ICDR standalone and bereft of context can be very dry and not productive.
While it's not for everyone, it is possible to make a career and thrive in the capital markets space.
1. Be familiar with basic Companies Act provisions for issue of shares.
2. Be familiar with the ICDR and LODR Regulations. Read the ICDR atleast once over, especially Schedule VI.
3. Catch up on sleep.
1) Get better at MS Word: As a Cap Marks lawyer, your primary job will be drafting/commenting on offer documents. Offer documents are legal docs and need to be formatted perfectly. Learn all the tricks - repeating headers in table, Para spacing, alignments. The more shortcuts you know, it is better as it will save you a lot of time.
2) Become aware of the Cap Marks transactions that your firm might be doing right now: you will necessarily be working on the precedents from these transactions, so it will if you already know the specifics of these transactions.
3) Read up on the types of transactions: equity transactions - IPOs, QIPs, FPOs, etc. Debt transactions: NCDs, international bonds, etc. Browse through offer docs of various types of transactions and try to get an idea of the basic law points.
4) ICDR: These regulations will be your go to for equity transactions, so get an understanding of the basic framework.
5) Enjoy this time off!! :Because once you start, there will be no end!
Also, does location make a lot of difference in terms of capital markets practice? Which would be preferable in the long term? Delhi/Mumbai?