It is not often that a CEE law firm decides to expand beyond the borders of its home market. Seeking out clients abroad and maintaining a standard of quality service is not only taxing but may also prove harmful – if not planned correctly.
Turkish firm Nazali Tax & Legal is a compelling example of expansion done right. In the short span of just six years, this Istanbul-born firm grew to cover six jurisdictions in Europe and North Africa. We spoke with Senior Partner Fatih Uzun, who has been with the firm since 2016 and deals with customs and foreign trade matters, to learn more about how Nazali came to be, why it expanded, and what its plans for the future are.
CEELM: As a brief primer, can you walk us through the history of Nazali?
Uzun: Actually, Nazali is a young firm. We’ve been established in November 2015 – we are celebrating our sixth anniversary.
Ersin Nazali, our Founding Partner, was working as a tax inspector until, in 2012, he decided to make the switch to private sector consultancy work. After having worked at an international law firm for two years he decided to create Nazali. It was a small firm with just six people, at the time, but it grew immensely over a short period. Now, Nazali engages over 250 professionals in six jurisdictions.
CEELM: Can you tell us more about Nazali’s overall operations?
Uzun: Nazali has five offices in Turkey, which is our core jurisdiction. Here, we operate out of Istanbul, Bursa, Ankara, Izmir, and Denizli. Outside of Turkey, we have set up offices in Casablanca, Kyiv, Moscow, Amsterdam, and London.
Nazali provides the full scope of legal services with over 25 practices such as tax (certification, consultancy, and litigation), customs and foreign trade, social security and labor law, litigation, corporate law, M&A, data privacy and protection, intellectual property, accounting, competition law, and financial audit. The philosophy behind the firm is that both financial and legal solutions could be provided to clients under the auspices of one office and one brand – like a one-stop shop. Besides, each of our partners is diligently following up on the projects and in close contact with the clients. We believe our clients are also pleased with such a unified professional approach, as they do not have to shop around for different sources of advisory solutions.
An important feature, having to do with why Nazali is successful in helping our clients with more than just pure legal advisory, is the partner structure. We have 14 partners in total, some having long histories of working within governmental structures in Turkey (i.e., tax, customs, social security, competition law), while others have significant private sector experience in multinational entities and law firms. For example, I have spent 11 years with the Ministry of Customs and Trade of Turkey as a customs investigator, thus I can say that we have extensive experience in both the theoretical and practical aspects of the services we provide.
We know how the system works, inside and out – which gives Nazali a competitive advantage – and our clients can expect not only more detailed advice but advice that is more likely to be actionable and efficient in getting the deal through.
CEELM: Your work and speedy growth have not gone unnoticed abroad. In 2018 you partnered up with Andersen Global and cooperated for some time. What’s the story there?
Uzun: Our collaboration with Andersen Global first started in 2018. They approached us first, initially engaging us as a collaborator firm and then as a full member of their global network. We even ended up taking their name!
We were a part of the Andersen Global network for a while, which was a fruitful experience for us, but we eventually decided to part ways at the start of 2020. The rationale behind this was that we wanted to expand and grow under our own name, to further develop and expand under a brand of our own making.
Don’t get me wrong, Andersen Global is, historically, a very strong brand in its own right. But we were, simply put, of a different making. Our boutique approach to tax and legal – for both domestic and international clients – mandated a different approach to client work, as opposed to that of the huge tax advisory firms and their affiliate law firms.
Instead of going for volume and having hundreds and thousands of clients, we sought to nurture trust-based relationships with each client – as if they were our only one. Thus, we considered that our next logical evolutionary step would be in that direction, so we found it best to part ways with Andersen Global. It was not a difficult decision and we parted ways amicably.
CEELM: Soon after that, Nazali began setting up shop in many other jurisdictions. How did this come to be and what were the main drivers behind the decision to expand?
Uzun: After that, we focused on our own brand, and we wanted to be the first Turkish firm to expand outside of our borders. To date, I believe we are the only ones to have had such a foray with a Turkish brand.
Now, our main drivers for expansion were, of course, our clients. Working with a number of large international companies, while fostering our bespoke approach to each one of them, bore fruit in the fact that they wanted us to support their operations elsewhere, not just in Turkey. Having a broad base of specialized legal services, it was quite inviting for us to scale up and spread out.
We first set up in Casablanca – Morocco has a lot of strong ties to Turkey because several companies operate along that line, so we figured this was a logical move. Also, we weighed that this move would allow us to keep a beat on business in North Africa and use Morocco as a gateway of sorts, eventually.
From there, we followed our clients and the flows of the business. We went to Moscow, which naturally led to Kyiv next. We then set our sights on Amsterdam and, in the end – so far – London. It was such a natural and organic evolution of our brand because we moved smart and listened to our clients attentively.
CEELM: Being the first Turkish firm to expand abroad and set up direct office lines must have been challenging.
Uzun: It was a difficult decision, indeed. Our transition was made easy by the fact that we already had a few dedicated desks for these markets but the leap from a desk to a full office is a huge one.
Penetrating foreign markets, however much preparation we put into it, was not easy. Every market and every client – especially when you approach them with such care and attention to minute details as we do – presents a unique challenge. And, of course, each new challenge comes with different perspectives to doing business. But, as I mentioned, our main catalysts for growth were our clients – it was them, in a way, who decided which markets we would expand to. If it weren’t for them, asking us to engage them more and more in these jurisdictions, we never would have reached outside of Turkey.
The mechanism of expansion was not difficult to find – rather more difficult to implement. We expanded by reaching out and hiring local experts and well-established professionals and began onboarding them to our vision. The process of transplanting our philosophy onto each one of our centers abroad was tough. In fact, we are still facing some challenges to full, seamless integration when it comes to transmitting our philosophy to every corner of our operation. But it is getting better every day.
Don’t forget that we are still a young firm, so these sorts of growing pains are normal. Why, most of our expansions abroad – to Ukraine, the Netherlands, and the UK – came in the past two years. It is a natural path towards establishing brand recognition, and we are more than up to the challenge. We want our approach to ultimately be a unified one, offering business-first solutions across the board. In that way, we can grow with our clients as they themselves develop.
CEELM: Is there any synergy in this sort of network approach? Do the offices help each other out?
Uzun: All our markets are in synergy, really. Our offices are building a common knowledge bank and our entire know-how vault grows in synchronicity. As we learn more from our clients in, for example, Ukraine – we can support our clients in Russia better. This sort of professional exchange weaves a tight-knit brand presence and quality of service.
As for our home base, Turkey has a very robust economy, both in terms of its GDP and the number of qualified, educated professionals. The workforce is uniquely positioned, and the manufacturing capacity potential is high enough for the country to be able to capitalize on all of it, in the next two or three years. As Turkey experiences investor surges from various parts of the world, we will be in a better position to help them, based on what we have learned and gone through in other markets.
CEELM: The strength of your team outside of Turkey is 50 professionals. Which office is the most developed one and represents a balancing point for your network abroad?
Uzun: In terms of headcount – our Ukraine office is the biggest one at this point, followed by Morocco and Russia, the Netherlands, and finally the UK. But don’t be fooled by the numbers here. Our entire team – all 250 of us – works together as one. Approximately half of the team are qualified lawyers, with the other half being experts like certified public accountants, customs brokers, IT specialists, even engineers and the like. This allows us to balance both law stricto sensu and business advisory, making Nazali more than both by integrating them.
CEELM: Finally, Fatih, what’s next for Nazali? What’s in the pipeline and where do you plan to go next?
Uzun: Establishing a clear strategy during pandemic times has been difficult and challenging. We still wish to expand our business to many other markets, but we must do so carefully and not rush in.
We are currently considering establishing an office in New York – and we were close to doing so last year, but we postponed this endeavor due to the market changes ushered by COVID-19. We want to see if we can accurately profile how the market would react to us before we take the leap across the Atlantic.
We do not believe that bullish expansion is the answer, and it would only be more difficult to expand and attract a local clientele with which we have no previous ties. So, we are currently focusing more on maintaining a happy client base, fostering our current relationships, and growing a bit more vertically, in terms of experience and knowledge.
All in all, it will take some time to see how Nazali clients are behaving and follow the ebbs and flows of global business. There is no rush for us, especially with the world on somewhat of a hold due to the changing conditions spurred by the pandemic. We will employ a more careful approach and decide on our next step towards enlargement later, with the right call at the right time.