The bike is a symbol of Tandem’s philosophy, “B.I.K.E.,” which stands for “Be yourself, Innovate, Kindness and Engagement” — a sentiment you’d be hard-pressed to find advertised in the halls of Big Law, though Tandem is home to a number of alumni of large corporate firms, including Latham & Watkins and Cooley.
Tandem Legal Group, which opened its doors in March, is a law firm that advises on general business issues, such as raising capital, managing investor relations and devising growth strategies. It has six attorneys and a staff of about 10, which includes its chief financial officer, chief operating officer, advisers and legal assistants.
Tandem prides itself on its anti-law firm culture. Co-founders McDevitt and Randy Price use words like “fun” and “cool” when describing the kinds of companies they want to work with. Their clients are a snapshot of the Northeast region’s up-and-coming contingent of mission-driven businesses, such as Sweetgreen; Potomac’s 3greenmoms, which makes LunchSkins reusable lunch bags; and Tessemae’s, the Maryland salad dressing maker whose products are in Whole Foods and Safeway. They also represent Brightest Young Things, the D.C. online lifestyle magazine and event-planning outfit, whose leaders stopped by last week to meet with attorney Sue Wang for a brainstorming session on how to grow the business in 2014.
The firm’s services are not entirely unique, but its ownership structure is. McDevitt is not a lawyer — from 2002 to 2012, he was chief executive of Owings Mills-based weight loss company Medifast — and the District is the only jurisdiction that allows law firms to share profits with non-lawyers. In all other states, McDevitt would have to be salaried.
Price was an associate at Latham for seven years, working on antitrust matters for large companies. After a while, he said, the work started to feel like “spinning the plates.” He went to work for a litigation funding firm, then started helping his friends, the three founders of Sweetgreen, when the company was sued for patent infringement last year.
“Companies like Sweetgreen, their legal work tends to pump up when they get to a certain size,” Price said. “We helped them get out of some cases.”
He then linked up with McDevitt to form Tandem in 2013. The firm is projecting revenue to be between $3 million and $4 million in 2014.
The firm’s core clients are companies in the $5 million to $20 million a year revenue range — established, but young and fast-growing. The vast majority of their 20-plus clients do not have an in-house legal team, so Tandem takes on that role for them.
“When you’re a start-up, people almost treat you like they’re doing you a favor, like ‘Oh, let me get to it when I get to it,’ ” Tessemae’s chief executive Greg Vetter said of other large and small law firms the company enlisted before moving all legal matters to Tandem. “You’re dealing with monotone attorneys who don’t really understand what you’re doing. They’re super stressed because they’re working in a law firm that has thousands of people and are just trying to bill as many hours as they can because the real estate they have probably costs $50 million.
“Then you meet these dudes from Tandem. They understand how fast we’re growing. They get things back to us at the rate we’re moving. When you have an investor that wants to give you $1 million and he needs 10 additional documents pulled out of left field in two hours, you don’t hear, ‘Well I’m in a board meeting.’ At Tandem, that’s in your inbox in two hours.”
Vetter also turns to McDevitt for advice that goes beyond legal issues, such as how to decide which retailers to put Tessemae’s products in, and how to run a company as a young CEO (Vetter is 30) when working with more-seasoned executives.
Tandem looks and feels like a start-up. All 15 employees work out of a single floor that the firm has been subleasing from LivingSocial since January 2013. There are no cubicle walls separating desks, and no suits and ties in sight. But the business they’re attempting to build — legal services with a business advisory component— is a throwback to what law firms were a generation ago, before they began growing into global behemoths. The firm’s leaders acknowledge that they are not reinventing the wheel.
“We’re building what law firms were 40 years ago,” McDevitt said.
By that he means the firm is not mimicking the pyramid structure of most large law firms, where junior associates bill lots of hours and essentially get paid to get trained and pass the cost onto the client, Price said. Tandem only hires lawyers who have at least five years of experience, and does not plan to grow bigger than 25 attorneys. They bill hourly for some matters (Price said his hourly rate is now about half of what he was charging at Latham) and attach success fees to others. Occasionally, they take the unorthodox step of taking a small equity stake in companies they represent, rather than charging legal fees.
“It’s usually a very small percentage, and it’s mostly mental,” McDevitt said. “Being part owner of a company, it’s about getting incentivized.”