Mayer Brown Eyes Outside Capital to Fund AI Investments
Law firms may tap private investors to cover the growing costs of artificial intelligence, according to Jon Van Gorp, chairman of Mayer Brown. Rather than seeking broad capital infusions, Van Gorp envisions targeted funding arrangements similar to litigation finance agreements.
"I could see private capital providing specific funding for AI with a use agreement between the firm and the AI vehicle where it's tailored, just like litigation funding," Van Gorp said.
The model would differ from broader private equity investments in law firms, which have gained little traction despite repeated attempts by firms like Burford Capital. Van Gorp noted that outside investors typically push for efficiency gains that conflict with law firms' professional obligations and partner-led governance structures.
The AI Cost Question Remains Unsettled
Law firms face uncertainty about the total expense of AI implementation and whether it will fundamentally reshape their economics. Van Gorp said no one in the industry has produced credible cost projections.
The challenge extends beyond software licensing. Firms must invest lawyer time to test and refine AI tools before deploying them to clients. Client demand is now driving investment decisions. "Clients are asking us, how are you using AI? And how is that making my legal fees lower, more efficient?" Van Gorp said.
Early AI adoption focused on internal operations-data management and firm administration. That has shifted. Clients now expect lawyers to apply AI to their work, pushing firms to move faster on implementation.
Mayer Brown's Growth Strategy Emphasizes Industry Focus
The firm hired 56 lateral partners last year, double the prior year's total. Van Gorp said the hires targeted six specific practice areas, with energy and infrastructure as priorities.
Energy demand is rising due to data centers and the global transition from fossil fuels to renewables. Infrastructure growth is tied to the same trends. Van Gorp framed the strategy around client needs rather than traditional practice areas. "No client has ever asked me what practice area I sit in," he said.
Mayer Brown's London office was a standout performer last year after years of investment in talent and market positioning. The firm is also expanding in Texas, where Japanese clients increasingly operate manufacturing, technology, and energy businesses.
Private Credit Concerns Don't Signal 2008-Style Crisis
Recent turbulence in private credit markets-including redemption requests that exceed fund capacity-has sparked comparisons to the 2008 financial crisis. Van Gorp, who worked through that collapse, sees important differences.
Private credit structures include default assumptions and investor protections. Lenders have remedies if loans underperform, including asset liquidation rights. "The defaults have been less than what I think people believe they are in that space," Van Gorp said.
Some workouts and imperfect recoveries may occur, but those outcomes are factored into business models. The market remains sound despite investor anxiety tied to historical precedent.
Mergers Possible but Not Urgent
Mayer Brown completed significant combinations about 15 years ago and is still optimizing those deals. Van Gorp said large mergers are not a current priority, though the firm remains open to growth opportunities.
Scale matters for spreading AI investments across more people and reducing per-capita costs. But Van Gorp declined to comment on specific merger discussions, including whether Mayer Brown considered acquiring Cadwalader before its merger with Hogan Lovells.
Trump Orders Haven't Fundamentally Altered Firm Decisions
Last year, executive orders targeting law firms caused some to reconsider cases against the government. Van Gorp said conditions are evolving and firms are adapting based on their clients, staff, and values.
Mayer Brown operates globally with 37% of its workforce outside the U.S., making it accustomed to geopolitical shifts. The firm continues to navigate changing conditions rather than retreating from certain types of work.
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