Ontra’s Asia-Pacific Managing Director Jon Crandall never intended to stay in Singapore for a decade. Yet after only a short time in Asia following an NYU School of Law exchange program, family, the region’s economic growth, and its dynamic cultures provided a thrill that has kept him firmly in place.
After time as a partner with Duane Morris LLP following eight years with law firm Clifford Chance, Crandall joined Ontra to help build the company’s global footprint and provide on-the-ground service in one of the most exciting, fastest-growing, and important regions in the world.
“Asia-Pacific accounts for more than 35 percent of global GDP, a higher chunk than any other region, including North America,” Crandall said. That number is expected to grow in the coming years as the region also boasts more than 40 percent of the world’s largest companies.
We sat down with Crandall to learn more about how he and the company’s growing team of legal consultants help asset managers and sophisticated global enterprises streamline routine legal operations and efficiently manage obligations so they can focus on their most important work.
What are some of the most exciting and challenging things about the region for you from a business perspective?
There are so many different countries, and most of them have different languages, religions, business cultures, and legal systems. From an academic and intellectual standpoint, it’s fascinating. From a business perspective, you quickly realize that those organizations that cross-culturally operate while maintaining global standards see the most success. You’re always navigating the differences, which keeps you constantly engaged and challenged. I particularly like being in a part of the world where everything is growing incredibly quickly.
Those variations, when compared to regions with more uniform economic and regulatory frameworks like the United States or the European Union, come with their own challenges. You have to navigate them in different ways. Sometimes you might need a very specific skill set for each country where you’re working. If you’re doing a deal, even for similar companies, it will be different in Indonesia versus Malaysia versus India. The way they run the business is different. The regulations are different. The region requires a novel approach almost every single time.
What unique opportunities and challenges have you seen in APAC asset management and the associated industries?
It’s all about the pace of growth. That’s within a lot of different segments, but especially private asset management. From 2015 until now, the private asset management industry more than tripled in size. Between now and 2025, it’s supposed to more than triple again. More than 100 new asset managers registered in Singapore alone last year.
Then, you look everywhere else in the region. Whether it’s Hong Kong, Japan, China, Australia, India, or anywhere else, it’s growing incredibly quickly. The challenge is that legal services aren’t growing at the same pace. We have customers who are seeing two, three, four, or even five times as many contracts as they did just one to two years ago. However, they don’t have five times as many lawyers to do it all. Ultimately, it is a case of growth that must be proactively and consciously managed.
There’s a massive opportunity for technology to improve the process. There are repetitive contracts where you negotiate the same five or six points every single time, such as commercial vendor contracts and NDAs. These are essential to running a successful fund. However, managing them the way it’s always been done is not the best use of resources, which I experienced firsthand. The APAC offices of most international law firms don’t have the same resources as their home offices in places like London or New York. They’re more leanly staffed, meaning quite often, you’ll find a senior associate or even a partner handling some of that routine work. Companies hire these firms to conduct strategic work, handle difficult negotiations and complex tasks like billion-dollar IPOs. It’s simply not cost effective for clients to pay more than US$1,000 an hour for a partner to review an NDA.
How have Ontra’s Singapore and Hong Kong offices grown to help provide coverage across the region?
We opened the Hong Kong office – led by Oscar Wang, who spent time at Ropes & Gray LLP – in early 2020. We opened the Singapore office, which I lead, in early 2021. Across Singapore and Hong Kong we will be a team of six by the end of 2021, with plans to double in 2022 to support our customers. At the same time, we’re working with more than 20 legal consultants across the region, based everywhere from Japan to Australia. We’re constantly looking to partner with talented, experienced, and client service-oriented legal consultants and are adding about five a quarter to keep pace with the incredible demand. In addition to English, we work with legal consultants to cover Mandarin and Japanese-language contracts to support the growing markets there. We’re discussing adding other languages, such as Korean, in response to customer demand.
What was the impact of the pandemic on the region, and what are you seeing and planning for in the years to come?
The human toll has been absolutely devastating in many places in the region, and looking at the case counts we’re by no means out of the woods here.
Economically, it’s been a roller coaster. By March of last year, the economic sky was falling. Most deal activity practically died overnight. There was a wave of emergency capital raises and debt refinancing so companies could strengthen their balance sheets, but all of the strategic dealmaking, IPOs, and similar activity fell off a cliff.
If you asked anybody around April and May of last year, nobody would have predicted the speed of the recovery. It took people by surprise. Since then, we’ve seen massive deal volume across APAC. Transactional lawyers have been busier than at any time in the last 20 years. We’re seeing many of our customers with 200 to 300 percent more deal activity than they had 12 to 18 months ago.
In terms of what’s to come, our customers are adding offices, they’re adding strategies, and they’re building out their teams. They need people to support that growth. It’s putting a massive strain on all sorts of professional services, particularly legal services.
As part of that, we’re focused on the ability to serve our customers globally. Large asset managers, especially those that operate worldwide, want a single service provider to ensure consistency. They want their documents negotiated the same way, stored in the same place, and with the same technology and processes built around them. This provides access to global data analytics offering true visibility into their negotiations while creating the opportunity to benchmark against precedent and past negotiations. APAC is extremely important for us to provide that global standard solution, and we’re continuing to build capacity across the region.
We’re also focused on helping private funds manage their obligations to critical stakeholders, chief among them investors and regulators. The documents underlying private funds are becoming more complex. There are more provisions in contracts because there are more regulations, and investors are more demanding, especially in cross-border transactions. It could be privacy regulations. It could be ESG-focused requirements. Asset managers that traditionally operate lean organizations must now do more than ever. What’s most important is that fund managers, whether they’re new or established, have systems controls in place to meet all of their obligations. Those obligations seem simple early on, but once a firm has multiple funds and hundreds of investors in multiple jurisdictions, the workload quickly becomes so large and complex that it can put many aspects of operations at risk.
