Examining Legal Tech Adoption, Part II

The second in a five-part series on legal tech adoption.

In the first installment of this five-part series, we explored the increasing resistance to change or the heightened inertia within the legal industry, particularly within private practice. Phoenix attorney and legal tech company founder Mark E. Lassiter summed it up well: “Last century’s lawyers saw legal technology as something that aided the practice of law, but this century’s emerging lawyers realize that legal technology is the practice of law.” As a reminder, here are the theories about the legal industry that were presented in my first installment:

  1. Legal tech companies will do better if the founders are former or current attorneys, because that creates a built-in incubator for the product.
  2. In-house or general counsels are important customers as they will drive change with the larger law firms faster than the legal tech companies.
  3. Legal tech companies have more challenges with medium and large firms because of their more cumbersome decision-making processes.
  4. It may be easier to dislodge another competitive legal tech solution than create a brand new solution that has no competitors and, therefore, no early adopters.
  5. Too many solutions or legal tech products (not necessarily companies) can create inefficiencies—unless there is seamless integration.
  6. Everyone resists change; attorneys are no different.

In this installment, I’ll dive into the first theory and examine whether having a founder who has a background in legal is an advantage. I’ll also share some sales cycle issues and tips.

I was able to ask about legal founders at an Evolve Law event* last week in Boston to a panel that included Dan Lear, Industry Relations from Avvo and two investors. My personal opinion was that legal founders are an advantage. However, I have since refined my original theory: it does not matter for the product as much as it matters for sales into the legal market.

Legal tech startups are no different than regular startups in terms of needing to solve a pain point. If there’s no pain, then there’s no solution required. The panelists thought an attorney might be stuck in his or her ways and would therefore not be a great problem solver or product development asset. They suggest that attorneys be consulted for their domain expertise or as sales advisor to secure those early clients. But a lawyer as a product-developer—i.e., the problem-solver—might be too conservative to be disruptive.

Jeff Bennion summed it up nicely: “I saw a huge gap, how bridging that gap could help, and how that gap would just get wider over time.” Jeff’s story below highlights the problems, and thus, the opportunities for developing solutions.

“I saw the office coming to a halt every time some document was lost. We were in trial one time, and we needed to find a copy of a deposition and we just could not find it anywhere… Attorneys would just be going through the motions and not focus on how new tools can aid in juror persuasion… tremendous time being wasted and opportunities missed because of the immense amount of work to be done and the inefficient manner in which we did it. So, having witnessed things like this almost daily, and acknowledging that technology would just keep growing, I decided to make an effort to incorporate technology into everything that we did, from paperless office to trial presentation software.”

All companies will fail if they do not have customers. It boils down understanding how to sell into a market that is filled with attorneys like Jeff.

Knowing your audience and their pain point is Sales 101. When asked what his primary reason was for adopting technology, Chicago-based attorney Andrew Greene, President of Business Law Network, said, “It either [will] get us additional business or increase profitability on existing business.”

This was echoed by NYC counsel, Christopher Edwards of Reitler Kailas Rosenblatt LLC: “I use several legal tech products, [like] Valcu and eBrevia, because they save my time and legal fees for my firm’s clients. They help me use my time most efficiently, focusing on tasks that add the most value for my clients.”

Taking this full circle, I know the founders of both Valcu and eBrevia include former attorneys. In fact, Valcu’s Mark Oblad is both an attorney and a coder—a rare but valuable combination, because it allows you to be both the issuer spotter and the problem solver. Then, if you have good relationships with your former firm, you have built-in incubators or first clients.  This echoes the model used by many large companies: create an innovation or skunkworks lab within your firm to nurture legal technology.

One final comment comes from Michael Melfi, an entrepreneur and an attorney, “Ultimately, we want the technology to empower our customers and team as well as make sense for the business financials.” Michael outlined his four criteria for adopting technology as security, cloud, scalability, and price. Security is a critical area for attorneys, and price should not overshadow it. “In the legal industry, the security is important; as your clients grow and transform, so will the law firm, and the technology needs to be able to accommodate this.”

Going back to the first article, the industry needs to change by adopting technology at a more rapid pace. Understanding attorneys’ needs and buying requirements before you build a technology is the best way to start and move into adoption.

It’s been great to receive feedback on social media. I’m happy to chat about this topic online. Tweet me at @maryjuetten. Next time we look at the sales challenges and solution integration.

*Full disclosure, I am a co-founder of Evolve Law.

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