Three pioneers of Internet-based legal services came together at ABA TECHSHOW in March to discuss the changing landscape of law practice and how lawyers can navigate the environment to enhance their bottom line.
According to the CEOs of Avvo, LegalZoom and Rocket Lawyer, success today means finding out what clients want and delivering on those needs.
Increasingly “clients want to consume legal services the same way they consume banking or Snapchat,” said Rocket Lawyer CEO Charley Moore, pointing out that it’s always customers that drive change – not service providers.
More than just demanding technology-based service delivery, today’s clients are rejecting the billable hour and seeking more transparency. “If you listen to your customers, they’ll say they want a flat fee, paid for by credit card, from a solution provider they trust,” said Avvo CEO Mark Britton. “But the majority of [lawyers] don’t offer that, and that’s not asking for much.”
Britton said that many attorneys aren’t on the bandwagon because of the way lawyers are trained to think. “We are issue spotters. It’s actually how we succeed,” he said. But as a result, lawyers get mired in dissecting potential problems, leading to inaction. “If all we do is focus on the issues…we miss the opportunities.”
Legal Zoom CEO John Suh agreed, noting that the way lawyers operate is often at odds with innovation and creative thinking, the kind of qualities that can drive the legal profession forward. “So much of the law is based on precedent, but so much of innovation is about thinking creatively, outside of it.”
Suh suggested that lawyers approach new ideas with an open mind, a “blank slate,” emphasizing Moore’s advice. “One thing that you should draw on that blank slate is: Listen to the customer at all times. If you listen, that should drive innovation.”
The panelists debated whether lawyer regulations are also stifling progress. Moore said that current regulations are not an impediment to change, noting the success of his company and those of his fellow speakers, as well as other “alternative” service providers.
But Suh disagreed, pointing out U.S. prohibitions against investments in law firms, a successful way of raising capital in the U.K. “Without the ability to fund innovation, without the ability to attract multiple people of diverse skills, it is very difficult to create innovative solutions.”
Suh also recalled a bar association annual meeting where there was a big debate about Facebook advertising. The participants had a long discussion about whether lawyers should have their posts approved by the bar.
“What is the state bar doing looking at Facebook changes and approving them? It didn’t make sense,” Suh said. “Some ways that lawyers are regulating themselves are really hampering their ability to be creative and hampering their ability to create solutions.”
Britton said that the impediment to progress isn’t regulations, but the “shadow” of regulation. “We have a lot of lawyers out there who are frozen in their action because they don’t know whether what they are doing is appropriate.”
Citing Suh’s Facebook example, Britton said: “You have many lawyers who won’t use Facebook because they’re not quite sure whether it comports with their bar association rules…. This creates this big shadow that billows out and keeps some of the most entrepreneurial lawyers from pushing the practice forward.”
For those lawyers who are concerned about the new technology-based outfits like the ones run by the panelists taking over the legal profession, Britton said their worries are unfounded.
“The [struggle] that many people are facing happened well before the advent of the internet,” Britton said. “There’s been a real decline in the last 40 years in solo practitioner income – I’m talking about 1971 going forward, where the bulk of that decline happened in the 80’s and 90’s,” he said, noting that providers like Legal Zoom and Rocket Lawyer represent less than 1 percent of the market, and are not the “boogey men” that some attorneys make them out to be.
All three companies—Avvo, Legal Zoom and Rocket Lawyer—have focused their attention on serving the middle class and small businesses, which the CEOs say have experienced the biggest drop in access to justice in the last several decades.
While the companies have been very successful – Legal Zoom is celebrating 16 years in the business, while Avvo nears 10 and Rocket Lawyer reaches eight – their CEOs say that there is a lot of room to grow and there is ample opportunity for others to gain a foothold in the market.
“The reality is that a lot of the folks who use our services would have gone without representation…. They wouldn’t have done it if services like ours did not exist,” said Moore. “We have a lot more work to do to continue to build both practices and software to get at that latent demand for legal services, to actually grow the market beyond where it is now.”
Britton echoed the point. While more than half of solos are using the Avvo platform, there’s a large percentage that isn’t, presenting a growth opportunity. “We can double the size of the legal market. It’s out there like an unplowed field. You could double the size of the legal market if you went for the other half.”
The panel was moderated by Judy Perry Martinez, former chair of the ABA Commission on the Future of Legal Services, and Paula Frederick, general counsel for the State Bar of Georgia.
ABA TECHSHOW is an annual conference of the ABA Law Practice Division.