Tech-focused law firm Fenwick & West—whose clients have included Silicon Valley heavyweights like Apple, Oracle, and Meta—has announced it will be laying off some 10% of its staff.

Fenwick, like many other firms in the tech sphere, went on a hiring binge during the early part of the pandemic as IPOs and other transactional activity surged. “Unfortunately, as transactional activity slowed in 2022 and 2023, our talent levels became misaligned with our existing and projected client demand, particularly in our large transactional practice,” Richard Dickson wrote in an email, reports Bloomberg Law. “I take responsibility for this and am truly sorry that those decisions have led to a significant impact on our people today.”

“Once more, we find the regrettable reality of yet another tech-centric firm being hit by layoffs,” legal recruiter Summer Eberhard told Bloomberg. Yet, she clarified that “the fact is that corporate transactional practices at firms are slow but I am cautiously optimistic that we have already hit the bottom and work will be picking back up over the next year."

While Fenwick & West faces the latest round of job-cuts in the industry, other notable firms like Cooley and Goodwin Procter had their own layoffs.

In November 2022, Cooley laid off about 150 staff, including 78 lawyers, following a slow-down in case activity. The cuts led to a 20% drop in profit per equity partner for the year, reported Bloomberg.

Meanwhile, Goodwin Procter axed 5% of its lawyers and staff earlier in 2023, citing overstaffing in the face of the current market. Then, this month, the firm announced that Chief Operating Office Michael Caplan would be leaving the company too.

THE VERDICT:

If Eberhard is right that layoffs at tech-focused law firms are slowing down, it should also be noted that start-up activity in Silicon Valley has yet to meaningfully reignite. The recent and very-public collapse of the Adobe-Figma deal put a freeze on VC investment, and IPOs still remain well below early pandemic levels.