Lawyers have a reputation for being risk-averse. They tend to help entrepreneurs achieve their vision turning startups into significant enterprises. It is much rarer for them to do it themselves. It is a rainy day in Portugal and Nollaig Murphy is telling me over a video call from his home why he has decided to co-found a new business called SenAer Trading. 

Murphy was a partner in law firms for almost 20 years, starting in A&L Goodbody before joining Maples when it was a rising star in Dublin.

Now he is chief executive of a tight-knit experienced team that has set up a new aviation technology company to give buyers and sellers access to the maximum number of potential institutional counterparties in the aircraft and parts industry. SenAer is an aircraft trading platform that includes a robust documentation management system to allow deals to take place easily. 

There are about 25,000 commercial aircraft globally and Murphy tells me SenAer wants to become the tech platform to let sellers share information with potential buyers of planes or parts in a secure and confidential environment. This is not an easy task as the documentation generated can stretch to many thousands of pages, ranging from cash flow models to paperwork around planes’ maintenance history. 

Our interview is wide-ranging and in two parts. The first is about Nollaig Murphy’s legal career and how he became fascinated with aviation, and the second is about his plans for SenAer and why he thinks it can play an important role in its industry. We begin with his early days.

From Project Cleopatra to joining Maples

Nollaig Murphy studied law in Trinity College Dublin before joining law firm McCann FitzGerald. In his 20s he moved to London to work in the law with Merrill Lynch and Clifford Chance. “I specialised in acquisition finance, structured finance and capital markets,” he recalled. 

Murphy spent 18 months on secondment with Merrill Lynch, which exposed him to bond traders in the late 1990s. “It was a bit Barbarians at the Gate stuff,” he recalled. “But it was good craic and great training as a lawyer in terms of understanding the commercial side of what you do.” 

While in London, Murphy got his first exposure to aviation. “As a trainee in the London office of McCann FitzGerald, I worked on what was called Project Cleopatra, which was the restructuring of GPA.” I ask Murphy about where the code-name for restructuring the pioneering leasing firm founded by Tony Ryan came from. “It was named after somebody’s cat,” Murphy replied. 

It was unglamorous work. “I was a lowly trainee, so I was putting 250 pages of complex documents into a fax machine and things like that. I didn’t think I would later specialise in aviation after that experience!” In 1999 Murphy moved back to Ireland just as the Celtic Tiger took off. He worked as a partner in A&L Goodbody, predominantly in structured finance as he’d gained some experience in this area in London. 

Two years earlier, Ireland had brought in section 110 special-purpose vehicles in this area. “As part of that alongside the aviation finance team, we started working on aviation securitisations,” Murphy recalled. 

Securitizations allowed companies to raise long-term capital by pledging cash flows of an asset pool, such as aircraft leases. Murphy found himself immersed in figuring out the complex legal arrangements required to do this. A&L Goodbody’s Nathanial Healy had structured the first aircraft lease receivables securitisation called ALPS 92-1 when it was originated by GPA in 1992. “Aviation law in Ireland was ground-breaking,” Murphy said. 

“The aviation sector allowed us to create probably the world’s first modern securitisation which went on to become the animal of choice for balance sheet management.” Murphy, as a rising lawyer, worked for or alongside Healy and others like Catherine Duffy and Séamus Ó Cróinín in A&L Goodbody. 

In August 2008, Maples, which had only set up in Dublin two years earlier, poached Murphy and another A&L Goodbody partner called Barry McGrath to join it. The departures were marked in The Irish Times with the headline “Top financial services lawyers on the move.” Murphy joined as head of Maples’s finance team, reporting to the head of its Irish business Andrew Doyle. 

“There was a broad-brush remit,” Murphy said. “It was to build a general banking, structured finance and aircraft finance practice. This meant I was much more in the weeds on the aircraft finance side.” Murphy worked for Maples for a decade as part of its senior team as the business grew to a team of 350 in the law firm, and 300 more in its fiduciary services arm. 

Back then, leaving the prestige of A&L Goodbody to join a new firm in the Irish market wasn’t easy. “Now there is a lot of lateral movement in the Dublin legal market but in 2008 there wasn’t,” Murphy recalled. “There were the grand dames of the legal world with their deserved reputations who were clearly committed to the Irish market,” Murphy recalled. 

“Lawyers are inherently conservative and it’s understandable that people would look to stay where they might have a long term future guaranteed,” Murphy said. He said the equity model with law firms made it hard for rising or senior people to leave. 

“To give up that security and to take a punt is an interesting question to arise for someone, particularly later in their career, where they’ve already got equity in their firm and they’re a partner,” Murphy said. “So, that was the challenge for Maples to really try to coax talent from other firms or London returners, or New York returners, and try to build it on from there. It was an interesting journey.”  

“At the time and maybe a year or two into it, I thought it was mad. But in hindsight I am glad I did it,” he said. “I wouldn’t suggest that the Maples expansion changed the market on its own, but I do think we showed it was possible to move around. I think the acceptability of that that we see now with incoming international firms post-Brexit was probably helped by Maples. Equally we have seen senior lawyers like Conor Owens and Angela Brennan move back to the big four.”

He said Doyle, as managing partner, had led from the front by being prepared to leave a senior position in Matheson to join Maples not long after it entered the market in 2006 by merging with Binchy’s. 

“One of the things that I always used to tell junior finance lawyers was you are, to some extent, recession-proof.”

Murphy said he started work with Maples the month before Lehman Brothers collapsed and the Irish state guaranteed its banks to prevent them all collapsing. “It was an interesting start,” Murphy deadpanned. “My structured finance practice fell off a cliff. We had to rebuild.”

“One of the things that I always used to tell junior finance lawyers was you are, to some extent, recession-proof,” Murphy said. “Litigation lawyers have their peaks and troughs as does the corporate M&A market.” 

“But if you’re a good finance lawyer and if you’re smart and you’re bright, then you can retool and retrain yourself to go from being a sort of acquisition guy doing M&A deals, to when the world crashes becoming a restructuring lawyer and helping insolvency market participants either wind up and restructure entities or fix and restart businesses.”

Maples, he said, turned its general banking group around completely. “There were no borrowers to borrow anymore and the banks were enforcing,” he recalled. 

“We ended up at one point being the number one law firm briefed by Nama in terms of size of deals,” Murphy said. “We acted on some of the other very large transactions at the time, like Quinn Group, INM, Eircom.”   

“Other firms were doing similar as well. It was a new economic world and that created a need to find a way to help people get through it from a technical perspective,” Murphy recalled. “We saw that as a challenge that we needed to step up to.”  

It was not all rebuilding from the wreckage of the crash. Murphy recalls Domhnal Slattery walking in the door of Maples for the first time. Slattery had his own scars from the crash, but he was determined to get going again by starting a new aviation leasing business called Avolon. All he had was an idea and Murphy said it was impressive seeing him turn that into a multi-billion-dollar business.

“Domhnal and John Higgins, Steve Graham, Andy Cronin and others were really just getting it all going,” Murphy recalled.  

“They were the business acumen behind it. We didn’t know if they were even going to be able to raise money.”  

“I think one of the outstanding achievements of that narrative arc was raising finance from significant world-class private equity houses and then from senior banks at a time when you couldn’t raise a penny,” Murphy said. 

“It was the worst time ever… and then that Icelandic volcano went off, grounding all planes right in the middle of the Avolon roadshow.”

“As a firm, we were involved all along in advising on the finance and the corporate side,” Murphy said. He worked closely with Ed Miller in Maples, who led its corporate team.   

“We were dealing with US and London law firms and really just trying to get it over the line,” Murphy said. “It was exciting and then it went to the next level from being a start-up to being effectively the number two leasing firm in the world.”  

In 2013, Murphy advised Avolon on its inaugural securitisation, a $636 million deal that achieved a rating from S&P and Kroll. 

In a statement at the time, Murphy noted: “It has been a number of years since a rated public aircraft securitisation successfully went to market, so this complex transaction represents a significant achievement for Avolon. 

Murphy remembers being inspired by the leaders in Ireland’s aviation sector. But he was still in love with being a partner in a big firm, and so moved onto other deals and advisory work. In 2018, he left Maples after a decade to do other things, after or around the same time as others who helped build the business including Doyle (2015) and McGrath (2017). 

As he reflected on his career, Murphy recalled his years working on aviation deals with fondness. “The Avolon experience and working with other leaders brought me a lot closer to the aviation sector,” Murphy said. “The people in it are unique. They are social but also smart and punchy. They want to succeed and do business and want to get deals closed. They did this through force of personality backed by an incredible skill set.”

“The international leasing industry has come full circle from GPA and is dominated by the Irish. The largest lessor in the world, by far, is headed by an Irishman Gus Kelly taking back GECAS into the fold. James Meyler heads Orix Aviation. Ireland really has taken a leadership position in the industry.”

“It took the best of the Irish personality and brought it onto the battlefield and actually won in terms of deals, in terms of building businesses,” Murphy said. “It was an interesting client culture to be around.”  

Creating SenAer

As 2018 concluded, Nollaig Murphy was tying up legal ends, preparing for a life away from the hothouse of being a partner in a law firm. He had been flat out for decades working in the law. 

He’d made good friends in aviation and seen the nitty-gritty of how deals were done. The entrepreneurial streak that had led him to quit a big-four firm now started to itch again. He kept thinking about how hard it was to do aviation deals and whether things could be done differently. 

Murphy was starting to think like an entrepreneur. Our conversation turns to the moment when the idea for SenAer began to form. 

“I suppose the genesis for SenAer was this,” Murphy recalled. “I’d seen new entrants come into the market to buy aircraft like private equity firms out of New York.”  

“They didn’t particularly know aviation. They definitely didn’t know about leasing. But they liked the assets and they liked the credit risk and the structure,” Murphy said. 

“They didn’t know where to buy the assets and they didn’t know how to manage them. But they were good investment managers who had skilled analysts who know about price structures.”  

Murphy had seen how aircraft lessor Aircastle had been formed in 2004 by investors. They hired experienced aviation management and a board to create a successful business before listing the business in 2006. As the years went on, more hedge funds and big investors started to get involved in the aviation sector. Murphy knew they often struggled to find deals as while they had the money but might not have had the contacts with lessors and airlines. 

Murphy started to talk about the mismatch between money and airline expertise with a friend and former client called Paul Gorman. Gorman was an ex-investment banker in New York. He had bought and sold aviation assets and liked the way they produced revenue, but it wasn’t easy to do deals. 

“Paul had bought aircraft metal back in the day, but he found it very difficult to find sellers if he had a further appetite for it because he wasn’t in the loop,” Murphy explained.

“One of the great things about the aviation sector – and also possibly one of its downsides – is that it is very collegiate.  They’re perhaps a little bit protective and they know who they know.”  

“Talking to Paul, we thought there was an opportunity to bring fresh money to the table.  That’s when we got the idea for SenAer and then about adding a tech idea layer on to that.”

Gorman and Murphy had seen how technology had been used to create a platform to sell aviation asset-backed securities (ABS) which are basically pools of aeroplanes generating income. 

Now their conversation shifted to whether technology could make it easier to do deals in other areas of the aviation industry. An idea formed to create a trading platform that would match buyers and sellers of aviation assets, tapping into the wall of money that was out there held by hedge funds and private equity-type investors. 

A third founder called Tain Hsia joined the business. Hsia formerly worked with the Federal Reserve Bank of New York but she also knew how to develop complex tech products in a secure and confidential environment.

As SenAer progressed she took the lead managing the team of developers required to develop its twin pillars: an aircraft trading platform and a document management system. Despite Covid-19 SenAer was working hard on building its product as the rest of the aviation industry fought to come through the pandemic. Murphy said a big trend he called the “narrow tech reboot” was why SenAer’s timing was good. 

“You may have noticed, or not, that you’re getting on planes for long haul flights that are perhaps smaller than the ones you used to be on,” Murphy explained. “They’re newer planes that use less fuel, and are more efficient.” 

Replacing older planes with new ones created an opportunity for a marketplace.  “Older aircraft will have to be sold on and they’ll be sold to newer markets in different jurisdictions,” Murphy said. 

“That’s where I think our platform might come in,” Murphy said. Airlines and lessors were recalibrating in response to the move by some to narrow-bodied planes, meaning new homes had to be found for older models. “There are certainly 19,000 to 20,000 planes that are going to need to be rebooted over the next 10 years because of the narrow-body tech reboot. This is a large volume.” 

“When someone looks to sell on an aircraft, we’ve assembled a pool of institutional investors,” Murphy said. “Our website can be basically used to post portfolios or post individual aircraft.”

SenAer has developed a pricing model to make it easier for potential buyers. “Aircraft metal is a particular animal with particular pricing models,” Murphy said. “Our experience with new entrants is it would take them maybe two months to build their own unique pricing model to do a deal.”  

“The deal could be gone by then.  So, people were losing opportunities. As part of our platform, we’ve built a pricing model that’s industry-specific. We think it is a one-size-fits-all for clients of ours as buyers to use to generate their own internal pricing model for their own investment committees.”

“I don’t like to call it the BidX1 of airplanes, because that would originally have had a certain connotation in the Irish property context, but there are similarities,” Murphy said. BidX1 was originally set up to shift vast numbers of distressed property assets after Ireland’s crash (but today it sells much more.)

SenAer isn’t targeting bottom-of-the-barrel assets. It is working with premium names, announcing separately last October that both Avolon and Orix Aviation were trading clients of its digital platform. Murphy said SenAer was close to announcing between three and four more names. 

Last September Conor O’Brien, a former head of tax and legal in KPMG Ireland became SenAer’s fourth partner. “Conor is the doyen of aircraft leasing in Ireland,” Murphy said. “He wrote the textbook on double tax treaties.” O’Brien retired last year as a partner from KPMG.

SenAer is self-funded by its principals at present. “We have had great traction to begin with and there’s always a certain amount of resistance to change and to new tech in any industry and I think that was one of the challenges that we had to begin with,” Murphy said. 

“But we’re seeing good open doors here.  People see us as complementary to what they do.  So, every big lessor has their pricing team, they have their sales team.  We’re not trying to replace that.” 

“We’re trying to add a functionality that will work in parallel with them and potentially open up this new pool of 11,000 investors and see where people can work together.”  

Will SenAer raise outside money? “We’re fine on cash flow,” Murphy replied. “What we’d like to do is to get a core quality coterie of clients fully onboarded.  And we’d like proof of concept on some significant sales that we can make public.”  

“We want SenAer to be accepted as just another part of the aviation industry,” Murphy said. “It should be something that you automatically think about when you’re selling aircraft. Or if you want to buy you automatically think about going on to have a look and see what’s happening.”