General Counsel and Head of Strategy at NivauraA&O: 2006-2018
Leaving Allen & Overy for a fast-growing tech start-up was never on Ricky Cohen’s long-term career plan. But for this ‘lawyer through and through’, it’s proving a challenging and exciting adventure.
From media to mining, auto-making to agriculture and leisure to law, there’s scarcely an industry these days that’s not been the focus of news stories about the disruption, or fundamental transformation, of the economy by digital technology.
We hear less about how the tech revolution is disrupting the personal and professional lives of people across the economy, which is odd, because such stories naturally abound.
One such tale is Ricky Cohen’s journey from high-flying senior associate at A&O to a leading role at Nivaura, a financial technology start-up intent on digitalising the capital markets.
Talk to Ricky and he is emphatic: up to about three years ago, nothing suggested he would find himself working at the leading edge of the tech world as Nivaura’s general counsel and legal product architect.
“No, no – I’m not a technologist,” he says with a chuckle. “I like my gadgets as much as the next person, but technology is not something I had a feel for at all.
“The truth is I saw myself as a lawyer through and through and was very much committed to a long-term career in private practice.”
Deciding to move to Nivaura was by no means straightforward, but the clincher came in the hot summer of 2018 as he and his wife, Phoebe, sat in their sunny garden. “She asked me if I would be happy if I didn’t do it,” he recalls. “I said ‘No’ and she said: ‘Well, you’ve got to give it a go.’”
The seeds had been sown some time earlier. As he explains, it involves not only his, but also A&O’s exploration of the powerful potential of combining legal, financial and deal technology.
Ricky was working in A&O’s London-based General Securities Group, a debt capital markets lawyer specialising in emerging market bond issues mostly for clients in Russia, Eastern Europe, Turkey and Africa.
But the securities issuance process was becoming commoditised. In the wake of the financial crisis, issuers and investment bank arrangers were increasingly unwilling to pay the fees this work had traditionally commanded.
Working closely with Phil Smith, a recently retired A&O partner, Ricky was also involved in setting up a European private placements market, similar to the U.S. one. But, amid these competitive pressures, the idea struggled to gain traction.
Inevitably, they found themselves asking how they could standardise the labour-intensive issuance process to make it cheaper, more efficient and less risky.
Though no technologist, Ricky was nevertheless fascinated by legal processes and became interested in A&O’s Advanced Delivery strategy.
His introduction to Nivaura came when Rose Hall, Global Head of Sector Business Development, asked him to meet a couple of men she’d spoken to who were working on a system to digitise the issuance process.
“The word was – don’t give it too much time. They’re at a very early stage and could run out of money quite quickly,” says Ricky.
He invited Phil along. “Phil did the classic thing, saying: ‘I’ve only got about ten minutes but wanted to come and say hello’,” Ricky remembers. “An hour and a half later, we were still chatting. Here was a company talking about addressing exactly the issues we were looking at in the private placement market.”
Revenue share and investments
Events moved quickly. Since the founders had no way of paying A&O’s standard fees, they put a revenue share agreement in place in return for the firm’s investment in time and resources and in providing the kind of legal documents that would allow the Nivaura team to test their ideas.
As the company’s potential became clear, Phil and Ricky pitched Nivaura to the A&O Board. The latter agreed to make a small initial equity investment with Phil taking a place on the Nivaura board, a position now held by partner Simon Hill.
Subsequently when Fuse, A&O’s tech innovation space, was launched in 2017, Nivaura became part of the first cohort of tech firms to join.
Working within Fuse, Nivaura successfully trialled its technology in the Financial Conduct Authority’s ‘sandbox’, a space allowing firms to live-test their ideas and gain regulatory authorisation. Ricky worked alongside the company as it launched a blockchain bond, a cryptocurrency bond and a structured product using blockchain – all industry firsts.
Nivaura, however, is not a blockchain company, Ricky stresses.
Instead it is all about automating security issuance in a way that also allows it to plug into the existing securities infrastructure, with all the main players, including banks, clearing houses and paying agents, interacting online.
Initially focused on providing an affordable way for smaller businesses to access the capital markets, its technology has equally attracted the attention of bigger players and institutions right up to supranational issuers.
At the heart of the technology is the general-purpose legal mark-up language (GLML) – on which A&O has had tremendous input – designed specifically for lawyers. The language drives the company’s interactive web-based system, much as HTML drives a conventional website, and is deliberately an open-source product that can eventually be used by players across the market.
Ricky makes it all sound misleadingly simple. “If you can bring three things together – a digital interface, an automated documentation package and a seamless data flow – you have a digital automated security,” he says.
The results so far are impressive. Doing away with the traditional manual issuance process, involving hundreds of emails and conference calls, can cut execution time by at least 55% – with a similar cost-saving.
But to succeed, Nivaura needed backing from other important commercial and legal partners. New investors came on board. The third part of its seed funding round, which raised USD20m for the business, was led in February 2019 by the London Stock Exchange (LSE), with Linklaters and Orrick also joining as legal industry backers alongside Santander and Aegon.
But Nivaura is clear about the debt it owes to the firm. “We fully acknowledge we could not have done this without A&O,” says Ricky.
Weighing up the options
As Ricky became more deeply involved in commercialising the company and its technology, it became an obvious option to move across full-time.
“It was a bit of a no-brainer, because this was a business I’d become passionate about,” he says. “Additionally, I did struggle with the idea that I might watch Nivaura go from strength to strength from the sidelines without being able to enjoy some of that success on a personal level.”
But there was much to weigh up. His career was progressing well and as part of the emerging leaders’ programme he was on a path leading potentially to partnership. However, at 37 and ten years PQE, he recognised he was working in a still nascent practice area, thanks to his focus on legaltech. It could take a few years more to make a successful business case for partnership.
There was Phoebe and their two young children, Marnie and Rafe, to consider as well.
As a hands-on dad – Ricky was one of the first male lawyers at A&O to opt for shared parental leave when his son was born in 2017 – it was important to be sure he could still devote enough time to family if he made the move. Thankfully, that’s been the case: his weekends are set aside for family as are the few hours before work when he can hang out with the children.
For all the excitement the opportunity offered him personally, there were sacrifices too in terms of salary and benefits. “You get options as part of a start-up but you can’t pay your mortgage with options,” he says.
It was a decision tinged with sadness. “I really love A&O and had always been happy,” he says. “I wasn’t looking for an exit and hadn’t become disillusioned. I just decided, if it was time to move, this provided a great opportunity and one that might not come up again.”
“If it was time to move, this provided a great opportunity and one that might not come up again.”
He is immensely grateful for the support he received from colleagues, not least senior partner Wim Dejonghe and head of Fuse Shruti Ajitsaria. They made clear the door was open should he ever want to return.
Fortunately, the links with colleagues at A&O endure. He is in regular contact with old friends and spends one day a week working from Fuse, where Nivaura retains a permanent desk.
Shruti welcomes that continuing connection too. “From working with Ricky while he was at A&O, it was clear he was totally behind Nivaura’s vision,” she says. “His curiosity and desire to be the best is part of the culture that A&O instills in its lawyers, and it was a natural step for Ricky to concentrate on Nivaura as its GC.
“I have the great fortune of still being able to work with him on a day-to-day basis which is just one of the benefits of having Nivaura in Fuse.”
The months after joining in January 2019 inevitably were busy ones for Ricky. A third of his job is around typical GC duties, ensuring the company remains legally compliant. But the biggest part of the role is as a legal product architect, helping to design the legaltech that most of the system runs on.
He clearly relishes the intellectual and professional challenge. “In a business like this, most of the problems you encounter don’t have obvious solutions and can seem intractable, so you’ve really got to think round them.”
Later in 2019, Nivaura launched a platform for the LSE for automated issuance of a medium-term note programme – a development that will be highly significant for A&O’s debt capital markets practice. Projects are also under way in the U.S. and in Asia, as Nivaura extends its international reach.
So what, ultimately, is the company’s aim?
“We hope to build Nivaura into a significant technology player in the global capital markets ecosystem,” says Ricky. “If we succeed it will be of great benefit to A&O as it continues to enjoy the revenue share arrangement.”
Nivaura doesn’t, as yet, have direct competitors. Although a number of groups are looking at digitalising parts of the issuance process, none is trying to create an end-to-end solution. That could change, but Ricky is relatively relaxed.
“It will show we are on to something and if we can have a few companies doing it well and selling the story for automated markets, we will all go up on a rising tide,” he adds.
Reconnect with Ricky Cohen at allenovery.com/alumni.