Michael Best Ventures Into Boulder With Acquisition

Modus Law attorneys already busy bringing startup expertise to Milwaukee-based firm

After Michael Best acquired startup-centric Boulder firm Modus Law, it didn’t waste time giving its new attorneys projects to work on. The former Modus lawyers have already been tapped for a half-dozen different assignments working with Michael Best’s Midwestern clientele in addition to their existing book of business.


Michael Best was eager to introduce its newest laterals and their startup expertise to its clients outside Colorado, according to the firm’s managing partner, David Krutz. He said the merger between his Milwaukee-based firm and Modus, which was announced Aug. 20, was “a natural fit both culture-wise and matched the business needs of our clients.” 

Michael Best brought on seven Modus attorneys with the acquisition. The larger firm will now operate out of Boulder and Broomfield in addition to its Denver location, where it currently has nine practicing attorneys listed.

Modus founder Shawn Stigler is now managing partner of the new Boulder and Broomfield offices. The other Modus alumni joining the firm are: corporate and transactional attorneys David Cline, David DiGiacomo and Elizabeth Prendergast; litigator Patrick Bernal; intellectual property practitioner Jolly-Johann Northrop; and labor and employment attorney Kaitlyn Trizna.

SHAWN STIGLER

Michael Best, whose president and chief strategist is former White House Chief of Staff Reince Priebus, has more than 250 attorneys in its 13 U.S. offices. The firm has been making a push for growth in the West; in March, the Denver location welcomed four IP laterals from Lathrop & Gage including Jon Trembath, who now co-manages that office. In September, it added six attorneys to its Salt Lake City office who mostly practice in corporate and securities law.

Krutz said bringing Modus’ attorneys into the fold fits with its larger “between the coasts” growth strategy where it has expanded from the Midwest into Colorado, Texas and Utah.

What was especially enticing about Modus was its presence in the Boulder startup market, Krutz said. Michael Best had been looking to expand its “Venture Best” brand of legal services for emerging businesses beyond the Midwest, and Modus would help the larger firm reinforce its foothold with Colorado entrepreneurs.

‘A Pretty Good Spot’ for Growth

When Stigler founded Modus in 2007, he aimed to be a part of the Boulder entrepreneurial scene by maintaining close ties with the University of Colorado and local tech incubators as he built a startup-focused law firm. 

“Thankfully that turned out to be a pretty good spot to do that,” Stigler said.

Modus started working with young companies, and as the business formation and corporate practice took off, it began adding other legal specialties like trademarks and employment. Larger firms began approaching Modus and floating acquisition talks, but Modus attorneys, who in typical Boulder fashion have been inclined to wear jeans and even flip-flops to the office, never felt a strong cultural fit with the previous suitors, Stigler said.

Not that Modus didn’t see benefits to being acquired by a larger firm. Its client businesses were growing and soon had legal needs stretching beyond what Modus could keep in-house.

“We were starting to get to a point where clients wanted to work with us, but they were like, ‘But there’s 10 of you,’” Stigler said. He and his colleagues discussed the prospect of growing the firm themselves to a full-service, 50-some attorney operation spanning more locations. But even with Modus’ trajectory, that would have taken a lot of time. “We’d all have a lot of gray hair, and it would be 30 years from now before we really pulled it off,” he said.

Last fall, Stigler began talking with Sarah Ehrhardt, the co-managing partner of Michael Best’s Denver office, as they had a mutual friend. Stigler mentioned that he grew up in Wisconsin, where the firm is headquartered, and that his father was a longtime employee of a local construction company there. That company had been a client of Ehrhardt’s, he learned. That connection, as well as what he saw as the firm’s modesty and compatible practice areas, led him to believe “these are the kind of people I’d enjoy working with and have the same goals and values we have,” he said.

The Midwest-West Connection

The firms were compatible not only culturally but also economically, Krutz said. Part of why Michael Best has stuck to expanding between the coasts is that it’s notoriously difficult for Midwestern firms to integrate offices in financial hubs like New York or Los Angeles. Attorneys in those markets typically bill higher rates and have a higher cost of living, plus there’s more pressure for incoming talent to come deliver big right away, Krutz said. A firm based in Wisconsin can more easily make the numbers work with offices in markets like Colorado or Texas.

“It’s easier for firms that have some alignment to come together because you’re not bringing together two separate economic systems,” Krutz said.

DAVID KRUTZ

Modus and Michael Best even had similar approaches to billing. Startup clients in Boulder are growing more accustomed to alternative fee structures like flat fees and other arrangements that eschew the billable hour. Modus’ attorneys had been providing those arrangements and will continue to do so under the Michael Best banner, as Michael Best had been employing some of those arrangements, too.

“One, they will be able to maintain that [billing] flexibility, and two, we’ve had that flexibility,” Krutz said.

Asked if Michael Best was considering further expansion in Colorado in the near future, Krutz said he doesn’t like to make predictions. He did say, however, that the firm is “always looking for those opportunities that are both an economical and cultural fit” and “would welcome discussions” as to what those opportunities might be.

In his new role, Stigler said he likes being able to introduce his existing clients to more specialized attorneys in the Michael Best network, like an FDA expert that a natural foods business needed for labeling matters. Besides that, Stigler said he was excited to create more practice opportunities for the young lawyers he works with and “build a great brand and reputation out in the market.”

“That will bring me just as much joy as if it were Modus,” he said.

— Doug Chartier

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