As we settle in to 2015, and with the recent passing of the LegalTech show in New York City, I’ve begun thinking about what law firms of the future may look like. In 2014, there were well over 600 “legal tech” startups that created technologies, business models, and platforms that aimed to improve law practice operations, client acquisition, legal research, and create better access to justice. However, the legal innovation landscape is still highly fragmented, and many of these startups offer solutions to very specific, singular problems. This has mostly to do with a general trend among technology developers to focus on creating apps for specific functions – which has spilled over into legal technology. Since lawyers have always been creative in their approach to the practice of law, I believe the law firms of the future will be curators of such technologies, and deploy them to meet the needs of their clients. The firms who do this successfully will not feel any competition from non-attorney owned legal services providers. So what will this look like? Suspend disbelief for just a moment and read on for a fictional example of what a law firm of the future may look like.
Axis IP, APLC* is a boutique intellectual property firm that provides services ranging from licensing and royalty agreements to copyrights, trademarks, and even more complex work like patent litigation. The firm is comprised of 2 partners and 4 associates, two paralegals and 1 administrator. Last years revenue topped 6 million dollars. How do they do it? The law firm has adopted a couple of alternative business models that include several relationship building services. For instance, they have created a legal access plan that provides early stage businesses access to basic legal services. The limited scope service package sells for $99 per month. The services include basic legal advice via telephone, document reviews of 10 pages or less, and access to their IP Protect software services which regularly crawls the web looking for potential copyright and trademark violations much like search engine indexing bots do today. If the software detects a potential violation, the paralegal receives an alert and does a preliminary evaluation which involves deciding to send out an automated DMCA letter, a cease & desist letter, or do nothing. All of which are handled through the software with only a click of a button. The law firm has acquired 450 subscribers to this service in the year and a half that it has been offering it and generates approximately $45,000 in monthly recurring revenue. For issues that fall outside the scope of the services offered, the law firm “upsells” the client to more comprehensive flat fee offerings or hourly work as needed to resolve the legal issue. Since the subscriber is on the plan, the subscriber always uses the law firm as the first point of contact for any legal issue. If the legal issue falls outside of the firm’s practice areas, then they refer the case out and collect a referral fee. Ongoing monthly upsells or referral fees generate an additional $11,250 in monthly revenue.
For intake and client acquisition, the firm deploys software on it’s website that helps businesses to identify their intellectual property assets and needs. A business will come across an “Identify Your IP” app through online research that leads them to the firm’s website. When the prospect completes the secure questionnaire, they will receive an immediate report identifying all potential IP assets, along with a plan for resolving the issue. Clicking on a “Resolve Now” button say for an asset that should have trademark protection will lead the prospect down a purchase path where they will pay for a flat free trademark service without ever having to speak with the attorney first. This allows the firm to conduct sales 24 hrs a day, 7 days a week. At checkout, the client will be asked to schedule an appointment with an associate through an online calendar. The associate will review the client’s input in advance of the call to double check that the service is appropriate for this client. The associate will also validate answers during a call with the client. If the service is not appropriate for the client the associate will apply a credit to a service or provide a refund.
When the firm is tasked with handling cases in the Patent Trials Appeals Board (PTAB), they will be able to look at data to gain competitive advantage, and determine how likely it will be to win a given case in that court. Their software will allow them to input a judge and technology sector. Once they submit those two factors, the software will quickly evaluate all of the decisions that the judge has ruled, then filter them by sector to provide data. The software will also be able to tell them who are the major players in the PTAB as well as how a set number of PTAB proceeds have ended historically. The firm will be able to use this data to manage client expectations, determine an ideal time for proceedings, and know which judge is most likely to rule in their favor.
The combination of offering all of these technologies will make them the preferred boutique IP firm among tech companies who appreciate software for increased efficiency and convenience, while still being backed by experienced lawyers.
Interestingly enough this fictional law firm of the future can in fact exist today. All of the technologies and business models described are already available and are being used actively by many law firms. While I have yet to come across a law firm that is using these technologies altogether, I know that the discussion has started, and an increasing number of law firms are demonstrating their interest in these types of software to help increase capacity and profitability. So while technology companies will continue to develop innovative products that aim to solve problems involved in the practice of law, I believe the law firms of the future will mostly be curators of these innovations and use them for the purposes of improving their business models, client acquisition strategies and generating increased revenue. So as it turns out the future of law is here today, what’s missing is taking that first step and creatively using the right mix of technologies and business models to break from tradition and be part of that future.
* As it turns out I’ve been receiving several inquiries about where to find this law firm online. Remember this is a fictional law firm I created to use as an example. However, the technologies described in my post do in fact exist and are available to law firms today.