Almost a third of UK law firms could go public over the next 12 to 18 months as they seek alternative financing options to the traditional partnership model, according to a survey by litigation funder Harbour.

Some 31% of firms said they were actively considering an initial public offering over that time frame, with a further 44% saying they were more broadly exploring the option of going public, the survey data showed. That comes after UK firm Mishcon De Reya's partners voted in September to list on the London Stock Exchange, with JPMorgan – the bank arranging the IPO – initially saying the share sale could come as soon as this quarter. Irwin Mitchell is also reported to be planning for an IPO. Harbour believes Mischon’s IPO could open the floodgates for more UK-based firms to go public.

Ellora MacPherson, chief investment officer at Harbour, said: “This survey shows a real desire by firms to access external finance to support their growth ambitions. IPOs are one way of doing this but won’t be the best fit for all firms. The survey reveals an expanding appetite amongst firms to source credit facilities from established litigation funders.”

More than three-quarters of respondents (78%) said their firms were either in active discussions or considering accessing additional funds through a credit facility. The survey data showed that more than half of law firm partners believe the pandemic has created new growth opportunities to expand existing practice areas or develop new business lines, underscoring the need for more capital to finance that potential expansion.

UK listed firm Knights, for instance, recently announced a £60m credit line that will enable it to continue turning its M&A pipeline into new acquisitions as it pursues its regional growth strategy.

A further 80% of survey respondents said senior leadership teams should embrace innovation to accelerate growth or maintain market position. 

Kennedys, for example, this month hired UK data specialist Antonio Acuña as head of data strategy – a newly created role. Such innovation and potential increases in external financing should help counteract cost pressures from clients, which were highlighted by 86% of survey respondents.