1. An overview of the Brazilian
corporate legal market
KermaPartners Global Firm Meeting
March 10th, 2009
Marco Antonio P. Gonçalves

2. About me
. Business administrator specialized in marketing and
.
business development strategies for law firms.
More than 10 years of experience working in the legal
.
and information technology markets.
Worked for seven years at a major Brazilian law firm (top
.
30 firm according to Análise Advocacia 2008).
Executive partner of Brazilian consultancy Gonçalves &
.
Gonçalves Marketing Jurídico.
Author of marketingLEGAL, the first and major Brazilian
.
blog on legal management issues.
Founder of Marketing Jurídico Brasil, the first and major
Brazilian debate group on legal management issues.
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3. .
The Brazilian legal market
Law firms are not the subject of regular
.
research in Brazil.
Very little and imprecise information is available:
– Number of lawyers;
– Number of law firms;
– Revenue of law firms;
.
– Etc.
The following slides show what is available!
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4. .
Lawyers, lawyers, lawyers!
.
638,538 lawyers by March 4th, 2009!
.
Result of +1,000 Law Schools.
326,000 lawyers work in Rio de Janeiro and São
.
Paulo (51%).
Rio de Janeiro and São Paulo both account for
45% of Brazil’s GDP (2006).
Fonte: Brazilian Bar (March, 2009) and IBGE (2006).
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5. Lawyers by region
8%
4%
12%
Mid-West
North
Northeast
South
61% 15% Southeast
Fonte: Brazilian Bar (March, 2009) and Gonçalves & Gonçalves Marketing Jurídico analysis.
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6. Growth between 2004-2009
600.000
500.000
400.000
Brazil (58%)
300.000 Southeast region (51%)
Other regions (69%)
200.000
100.000
0
Apr-04 Dec-04 Aug-05 Apr-06 Dec-06 Aug-07 Apr-08 Dec-08
Fonte: Brazilian Bar (March, 2009) and Gonçalves & Gonçalves Marketing Jurídico analysis.
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7. .
A highly pulverized market
A large number of lawyers work alone and provide
.
service mostly to individual clients.
Around 60,000 lawyers work in an estimated
.
21,000 firms.
Most firms have between 2 and 5 partners.
Fonte: Análise Advocacia 2006 (September, 2006) and Valor Análise Setorial (December, 2006).
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8. Hypothetical distribution of law firms
by number of partners
2% 2%
24%
2 partners
3 to 5 partners
6 to 10 partners
More than 11 partners
72%
Fonte: Valor Análise Setorial (December, 2006). Some figures are estimated.
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9. Law firms by state
25%
36%
São Paulo
Rio de Janeiro*
Rio Grande do Sul
Minas Gerais
9% Othes states*
11%
19%
Fonte: Valor Análise Setorial (December, 2006). Some figures are estimated (*).
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10. .
How much do these firms make?
Based on the revenue of 13 large firms, a
mathematician estimated in 2006 that the top 100
Brazilian firms earn R$ 2.4 billion (more than
.
US$ 1 billion).
A raw estimate for all Brazilian law firms would
be around R$ 6 billion (less than US$ 3 billion).
Fonte: Análise Advocacia 2006 (September, 2006) and Valor Análise Setorial (December, 2006).
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11. Revenue for 19 law firms (2005)
Firm HQ Annual revenue Number of Annual revenue per
(R$ thousand) lawyers lawyer (R$ thousand)
Fonte: Valor Análise Setorial (December, 2006).
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12. Revenue for some of the top firms (2005)
Firm Revenue (R$ million)
Pinheiro Neto Advogados 200*
Demarest & Almeida Advogados 150*
Machado, Meyer, Sendacz e Opice Advogados 150*
Mattos Filho, Veiga Filho, Marrey Jr. e Quiroga 150
TozziniFreire Advogados 150*
Veirano Advogados 100
Barbosa, Müssnich & Aragão Advogados 80*
Siqueira Castro Advogados 80
Fonte: Valor Análise Setorial (December, 2006) and Análise Advocacia 2006 (September, 2006). Some figures are estimated (*).
© Gonçalves & Gonçalves Marketing Jurídico. All rights reserved. 12

13. Análise Advocacia 2008 (3rd edition)
.
.
Ranking of 674 corporate law firms.
More than 1,299 professionals from 1,181
companies named the lawyers and/or firms
they admire.
.
(page 21)
(...) companies were gathered from the rankings
of four Brazilian publications: Exame Melhores e
Maiores - edição 2007; Valor 1000 - edição 2007;
As melhores da Dinheiro - edição 2007; Balanço
Anual, da Gazeta Mercantil - edição 2007.
(page 21)
Fonte: Análise Advocacia 2008 (September, 2008).
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14. Análise - Ranking by region
3% 1%
6%
16% Mid-West
North
Northeast
South
Southeast
74%
Fonte: Análise Advocacia 2008 (September, 2008) and Gonçalves & Gonçalves Marketing Jurídico analysis.
© Gonçalves & Gonçalves Marketing Jurídico. All rights reserved. 14

15. Análise - Ranking by firm size
5%
8%
38%
Small
Medium
Large
Mega
49%
Fonte: Análise Advocacia 2008 (September, 2008) and Gonçalves & Gonçalves Marketing Jurídico analysis.
© Gonçalves & Gonçalves Marketing Jurídico. All rights reserved. 15

16. Análise - Ranking “top 10”
# Firm Lawyers Year
1 TozziniFreire Advogados 437 1976
2 Demarest & Almeida Advogados 428 1948
3 Siqueira Castro Advogados 388 1948
4 Pinheiro Neto Advogados 342 1942
5 Machado, Meyer, Sendacz e Opice Advogados 301 1972
6 Mattos Filho, Veiga Filho, Marrey Jr. e Quiroga 267 1992
7 Décio Freire & Associados 253 1992
8 Édison Freitas de Siqueira Advogados Associados 217 1987
9 Barbosa, Müssnich & Aragão Advogados 215 1995
10 Noronha Advogados 215 1978
Fonte: Análise Advocacia 2008 (September, 2008).
© Gonçalves & Gonçalves Marketing Jurídico. All rights reserved. 16

17. Análise - Ranking by years of practice
7%
5%
7% 33%
Les than 10 years
10-20 years
20-30 years
12%
30-40 years
40-50 years
More than 50 years
36%
Fonte: Análise Advocacia 2008 (September, 2008) and Gonçalves & Gonçalves Marketing Jurídico analysis.
© Gonçalves & Gonçalves Marketing Jurídico. All rights reserved. 17

18. Análise - Ranking by practice areas
13%
37%
Specialized
"In between"
Full service
50%
Fonte: Análise Advocacia 2008 (September, 2008) and Gonçalves & Gonçalves Marketing Jurídico analysis.
© Gonçalves & Gonçalves Marketing Jurídico. All rights reserved. 18

19. .
The crisis and the Brazilian legal market
.
Crisis? What crisis?!
Based on the Brazilian specialized
media, everything seems fine, at least for the
.
top firms. No negative news yet!
Everything is fine even for foreign firms operating
.
in Brazil.
When will the crisis hit the Brazilian legal market?
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20. .
Regulatory barriers
Foreign firms can only work in Brazil as a
consultant to the Law of its country of
.
origin, regardless of hiring Brazilian lawyers.
The barriers were established by the Brazilian Bar
.
(OAB) in 2000.
The lawyers behind the barriers agree that they will
eventually fade. The questions is… when?
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21. .
General considerations
The debate on legal administration and legal
.
marketing is very recent (last 5 years).
Professional management (by non-lawyers) has
.
yet to play an essential and strategic role.
Some of the firms have CEOs and they are usually
.
lawyers. Some practice, others don’t.
Legal marketing is mostly “window dressing”.
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22. .
More general considerations
Information-based decision making is rare.
Decisions are mostly based on gut feelings and
.
guessing.
The use of technology is mostly limited to the “use
.
of technology for the sake of technology”.
Business intelligence is used by very few firms
(“what is BI, anyway?”).
© Gonçalves & Gonçalves Marketing Jurídico. All rights reserved. 22

23. .
More general considerations
Mergers and acquisitions between firms are not
.
regular subject of the media but they do happen.
Corporate clients are becoming more and more
strategic (and becoming more and more
.
demanding of the legal service providers).
An ACC-like association has been founded in
2008. Still embrionary but moving forward.
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24. Thanks!
Questions?
Marco Antonio P. Gonçalves
goncalves@marketingjuridico.com.br
Questions are also welcome via e-mail.
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