Within just 90 days, three of the country’s most storied firms quietly closed the door on equity ownership. Nobody outside the profession noticed. Everyone inside it should have.
In January, Sullivan & Cromwell rolled out a nonequity partner program. In February, Freshfields added a nonequity tier of its own. In March, Sidley followed with a new income partner role.
None of these firms treated the move as momentous, and that’s the tell. Not long ago, adding a permanent, non-ownership rung to the partnership ladder was the kind of change that demanded careful explanation, even apology. By early 2026, it had become routine, announced in a firmwide email sent out on a Tuesday afternoon. With Sidley’s announcement, eleven elite firms have now added a salaried partner tier since Cravath set the precedent in November 2023. Today, about 85% of the Am Law 100 operates with some version of a two-tier partnership.
The majority nobody announced
A nonequity partnership means a salary and a title. Sometimes it is an excellent salary, always a hard-earned title. But it is not ownership. Quietly, the profession has crossed the line: most partners now fall into this category. In the 2025 Am Law 100, nonequity partners made up 50.9% of the total, the first recorded majority. The latest ALM data puts that figure at 52.1%.
This isn’t just a matter of percentages. According to the Citi Hildebrandt 2026 Client Advisory, the number of equity partners across the industry actually shrank by 0.5% in the first nine months of 2025, while the nonequity tier grew by 6%. The ownership class is not only a smaller piece of the partnership pie. It is shrinking in real numbers, even as the rest of the profession expands.
A more expensive ticket to a smaller room
And gaining entry into that shrinking circle is more expensive than ever. According to BCG Attorney Search, the average capital contribution at an Am Law 50 firm is now about $550,000, up from $375,000 just a decade ago. For many new partners, that represents 25% to 30% of their expected first-year compensation.
Let’s be candid about what that really means. It’s a six-figure investment for a minority, non-controlling, illiquid stake in a business. You have no input on how many more shares might be created. And the offer comes just as the firm is narrowing who gets to own it at all. If we were advising a client on such terms, we’d urge caution and a close reading of the fine print. Yet, for ourselves, we call it success.
Ironically, the business itself has never looked stronger. The 2026 Am Law 100 shows profits per equity partner up 14%, averaging $3.59 million, with Kirkland & Ellis becoming the first firm in history to exceed $10 billion in annual revenue. Big Law’s financial performance is at a high point, yet ownership is further out of reach for the majority of its partners than ever before.
The strategy is working exactly as designed
This isn’t an argument against any firm’s specific choice, nor should it be read that way. Sidley’s results highlight the business rationale: after introducing its income partner tier, the firm’s next partnership class grew by 79%, jumping from 29 to 52 promotions. From management’s perspective, this tier is a real growth lever, allowing the firm to reward more talent while preserving the equity structure that attracts top lateral hires. Other firms watching from the sidelines are likely to take note.
But it’s worth being honest about what’s left for the lawyer in the middle of the pyramid. Once, making partner and becoming an owner meant the same thing. Now, for most partners, those are two separate conversations. The second one might never come, no matter how long the first continues.
Where ownership went
Those with the most options have already noticed. According to NALP’s latest survey, lateral hiring at firms with 250 or fewer lawyers surged nearly 44% in 2025, the biggest increase in any market segment and a total turnaround from the previous year. Senior lawyers are moving to smaller platforms, where the journey from partner to owner can be measured in years, not decades. For many, that path does not exist at all in Big Law.
Some have gone a step further, building their own firms. For example, a group of former Big Law and government lawyers launched Liu Shur Kravis this spring, organized around small teams led by senior partners. What historically kept partners from making such moves wasn’t the clients, who tend to be loyal to lawyers rather than letterhead, but the operational unknowns: billing, trust accounting, technology, and the host of back-office tasks that big-firm partners rarely encounter. That barrier is quickly eroding. There are now enough new firms launching that Law.com recently profiled the specialized service providers, Federate Legal among them, who support partners through these transitions. This is what’s being called Big Law’s boutique boom.
So the real question has shifted. It’s no longer just about how to make partner. It’s about what partnership actually means today, and whether the most certain route to real equity is the one you forge for yourself. If the NALP data is any indication, many lawyers have already made their choice.