Wilson Sonsini’s marketing programme to attract internet start-up clients

From the New York Times, Wilson Sonsini Retools Strategy to Land Internet Start-Ups:

“…reflects the firm’s evolving mind-set as lawyers jockey for the attention of start-ups. In an effort to build credibility among new technology companies, Wilson Sonsini and others are employing a broad set of tools, including offering free services, cozying up to incubators and writing blogs.

Such efforts are critical. While early-stage ventures represent just 20 percent of the firm’s business, those companies can generate hefty fees as they mature. Wilson Sonsini and other firms also make small investments in young start-ups, which can pay off in later years.

“Small deals would not have interested these firms a few years ago,” said Joseph A. Grundfest, a Stanford law professor. “Now, it’s the new normal.”

For years, Wilson Sonsini dominated Silicon Valley, shepherding young technology companies like Apple, Netscape Communications and even the ill-fated Webvan. In 1998, Lawrence W. Sonsini, the firm’s patriarch, introduced two Stanford graduate students to Sequoia Capital and Kleiner Perkins Caufield & Byers, two top venture capital firms. Six years later, Wilson Sonsini helped their company, Google, go public.”

See also: StartupCompanyLawyer.com, run by a Wilson Sonsini partner

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Who Got Funded, “a comprehensive website tracking all venture capital developments in every industry and region in the world”

“WhoGotFunded.com is a comprehensive website tracking all venture capital developments in every industry and region in the world. The website was developed as part of an ambitious web mining project led by Digimind, a global leader in competitive intelligence solutions, in conjunction with Daedalus, a company specializing in semantic analysis.

“Two senior city professionals at leading city institutions” arrested in “the FSA’s largest ever operation against insider dealing”

From the Financial Services Authority this morning:

“In the first operation carried out jointly between the Financial Services Authority (FSA) and the Serious Organised Crime Agency (SOCA), 16 addresses have been searched this morning in London, the South East and Oxfordshire in the FSA’s largest ever operation against insider dealing.

UK Corporate Governance and Stewardship Codes: FRC confirms changes

The Financial Reporting Council confirmed on 28 September 2012 that it is going ahead with changes to the UK Corporate Governance Code and the Stewardship Code. These changes were consulted on in April 2012, as we discussed here. The changes to both Codes are “intended to increase accountability and engagement through the investment chain”. The FRC’s press release is here.

The new version of the Governance Code is here and the new version of the Stewardship Code is here. The updated Codes apply from 1 October 2012.

The FRC has also published an updated edition of its Guidance on Audit Committees to reflect the changes to the UK Corporate Governance Code, and will carry out further consultation on whether changes are needed to those parts of the UK Corporate Governance Code dealing with remuneration when the Government’s legislation on remuneration reporting and voting has been finalised. Any changes following this consultation will be effected in the next edition of the Code.

UK Corporate Governance Code

Here is the FRC’s summary of the changes to the Governance Code:

Professional advisers’ duty of care and engagement letters: Wragges summary of Arrowhead v KPMG LLP

A useful summary of Arrowhead Capital Finance Ltd (In Liquidation) v KPMG LLP by Wragges here:

Market abuse: hedge fund manager and two traders fined and banned for “window-dressing the close”

The Upper Tribunal has confirmed the FSA bans and (in two cases) fines on Stefan Chaligné, a Swiss-based hedge fund manager, Patrick Sejean, a former senior salesman on Cantor Fitzgerald Europe’s London-based French desk and Tidiane Diallo, a former junior trader on the same desk, for what the Tribunal described as “as serious a case of market abuse of its kind as one might conceive” (in this case, the limb of the market abuse offence at section 118(5) FSMA 2000). The Tribunal’s decision is here. From the FSA press release:

“Chaligné, a French National who was both the fund manager of, and a shareholder in, the Cayman Islands based “Iviron” hedge fund deliberately manipulated the market in a total of nine securities traded on a number of different European and North American exchanges. He did so by placing orders, through CFE, which were designed to increase the closing price of the securities, and thereby increase the value of the hedge fund, on two key portfolio valuation dates for the fund.

The practice of manipulating share prices on portfolio valuation dates (month and year ends) is known colloquially as “window-dressing the close”. Having manipulated the price of eight securities on 31 December 2007, Chaligné then also manipulated the price of two securities on 31 January 2008.

The increases in the valuation of the fund enabled Chaligné to present a positive view of the performance of the fund, at a time of difficult market conditions, to current and prospective investors, and thereby present himself as a competent fund manager. The practical effect of his market abuse was to increase the performance and management fees paid to him by the beneficiaries of the hedge fund.

Sejean and Diallo effected and executed Chaligné’s orders for the purpose of achieving Chaligné’s objective. Diallo was involved on one of the dates. Sejean was involved on both dates and deliberately influenced and involved more junior members of staff, including Diallo, in the misconduct. They both understood the manipulative nature of the orders.”

More market abuse here.

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Should high-performing executives be lavishly paid in case they move elsewhere?

No, according to this report in the New York Times on a recent study  by two US academics who:

“…conclude, contrary to the prevailing line, that chief executives can’t readily transfer their skills from one company to another. In other words, the argument that C.E.O.’s will leave if they aren’t compensated well, perhaps even lavishly, is bogus. Using the peer-group benchmark only pushes pay up and up.

Luke Johnson on cash and cashflow, Anthony Hilton on why the City needs Europe

Trust cash cows rather than herd instincts – Luke Johnson, FT

Why leaving the EU would be bad for City – Anthony Hilton, Evening Standard

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Equity and debt, the unlevel playing field

Xavier Rolet, Chief Executive of the London Stock Exchange, on why smaller growth companies “”not a mortgage, but equity funding”, and on the reforms needed to encourage equity investment in those companies:

“There…remain important structural reasons that are holding back private investors from funding our growth companies. Arguably the most significant is the tax treatment of equity: taxed at purchase, dividend and sale, in addition to the corporation tax paid on company profits, equities are treated aggressively while debt is often tax-deductible. Reducing tax on capital gains made from direct and indirect investment in smaller companies would also help boost liquidity by attracting more investors. And, a targeted abolition of stamp duty for Aim and PLUS-quoted shares would be a particularly low-cost and effective measure to promote growth.”

See also: A new route to the UK IPO market: Government plans to relax rules to attract high-growth companies to list on LondonA new route to the UK IPO market: Government plans to relax rules to attract high-growth companies to list on London

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