The Legal Industry in the Metaverse - Legal Disrupters

Legal, tech, business, AI.

The report says take up of the technology across England and Wales is incredibly high, with around half of lawyers surveyed reporting they are already using AI technology.

People just don't realize, there's an entire new world emerging full of clever new tech that's going to revolutionize the way we do business. The role of the lawyer in particular is changing dramatically.

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Electra Japonas

Old school lawyers, particularly, think that everything that they do is really, really special.

Sam Walkley

Great legal tech won't replace a great lawyer, but great legal tech in the hands of a great lawyer is game changing.

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This is Legal Disrupters powered by Summize. Digital contracting done differently.

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Graeme Smith

Hello, welcome back to Legal Disrupters. We're going to be checking all the latest news in the world of legal and tech in just a second. Also this week, we're joined in conversation by Electra Japonas, founder of The Law Boutique; and Tom Dunlop, the CEO of Summize.

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Coming up on Legal Disrupters.

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Electra Japonas

Old school lawyers, particularly, think that everything that they do is really, really special and so therefore needs to be bespoke and needs to be done manually in a very artisanal way. And I think that now we're coming towards more thinking around... we're more open to thinking about how to scale the things that we do.

Ben Wood

We've already had an interesting step in the right direction with the pandemic because we are starting to live more blended lives. We're working from home, we're coming back to the office.

Electra Japonas

So taking a contract and drafting it from scratch with your red pen, isn't really going to work as a scalable thing to do.

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Legal, tech, business, AI. This is Legal Disrupters news.

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Graeme Smith

The New York based ReportLinker.com has announced a release of a long awaited report into growth and trends into the legal AI tech market. It found the AI software market in the legal industry valued at $548.4 million, and it's projected to be worth $2.6 billion in 2027, registering growth of nearly 30% over the period, 2022 to 2027. According to the 2020 Legal Analytics study conducted by LexisNexis, about 92% of law firms are planning to increase their adoption of AI for analytics in the next 12 months. This is majorly driven by competitive pressures, such as the need to excel in the business at 57% and meet client expectations at 56%.

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Legal Disrupters.

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Graeme Smith

The UK financial newspaper, City AM, has reported that the London law firm Mishcon de Reya has struck a deal with UCL to fund research into the use of artificial intelligence in the legal sector. Mishcon's decision to fund research into AI comes as the firm now believes AI technology will revolutionise the legal sector and transform the ways that lawyers work. In striking a deal with UCL, Mishcon is set to fund PhD student Yao Lu’s research into AIs that are able to read and interpret documents.

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Legal Disrupters.

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Graeme Smith

The legal technology directory, Legaltech Hub, is having a revamp to steer the informational tool in a more holistic direction. The latest update, one of the biggest since its launch in October, 2020, seeks to do something more than just being a directory according to the founder of Legaltech Hub, Nicola Shaver. It attempts to solve the pain points of legal tech procurement, educating buyers on how to map their processes by integrating search tools with additional background information.

And the UK legal technology sector has a potential £22 billion annual market opportunity. This according to a new report from Lawtech UK. The study, Shaping the Future of Law, shows that serving unmet demand from small and medium size businesses (SMEs) and consumers could be worth £11.4 billion in annual revenues while also enabling £8.6 billion in cost savings for SMEs every single year. In addition, legal businesses in the UK could generate £1.7 billion in annual productivity gains through the use of legal tech.

The roughly 200 legal tech start-ups in the UK attracted £674 million in investment by December last year. With its growth rate outpacing the FinTech, climate tech and health tech sectors. The UK legal tech businesses could attract £2.2 billion in investment every year by 2026, contributing twelve and a half thousand jobs to the economy over the same period.

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Paris Monroe

In our first report this week, turns out what most people have noticed for some time is now backed by a new survey. That's the news that the majority of in-house lawyers do not want a full-time return to office working, despite almost half of them already being back in five days a week. A survey of 350 in-house lawyers based in the UK and US found that 66% would rather that their employer adopt a work from home policy. Of these, respondents were split equally between those wanting hybrid working and those wanting to be remote full time. Half those surveyed said they are already back in the office full time. With 57% of UK-based respondents and 44% of US-based lawyers reporting this. The findings were based on responses from 100 lawyers in the UK and 250 in the US.

Here is Tiziana Casciaro, professor of organizational behaviour at the University of Toronto.

Tiziana Casciaro

They face a big challenge because the pandemic has given their employees a taste of what it means to have more autonomy. And so leaders have to be very thoughtful about what it means to tell their employees "No more - now we tell you again where you're going to work and how you're going to work, and when you're going to work" versus allowing them some leeway, some flexibility.

Paris Monroe

Like most sectors, there is now a real appetite amongst in-house lawyers, both in the UK and the US, to be able to work from home for good. Intransigence about approving hybrid working may also provide a boost to fully digital law firms who enable lawyers to work as consultants working remotely. Clearly, like all sectors the appeal of the greater life balance is something employers across the board are having to contend with. But, when recruiting specialized legal and technical staff, it is something that's simply not going to go away.

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Legal Disrupters.

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Graeme Smith

Paris Monroe reporting there. I'm Graeme Smith, this is episode two of Legal Disruptors.

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You're listening to Legal Disrupters powered by Summize, with the must-listen-to people at the cutting edge of legal, tech, business and AI. This is the trend setter talk on Legal Disrupters.

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Graeme Smith

This week on the trend setter talk, we're joined by Electra Japonas, the founder and CEO of The Law Boutique and Tom Dunlop, the CEO of the Manchester based legal tech start-up, Summize.

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Legal Disrupters.

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Graeme Smith

Electra, can you tell us a little bit more about your professional background. What led you to leave your job as an in-house lawyer and start The Law Boutique?

Electra Japonas

Yeah, I was an in-house lawyer for about 10 years and very frustrated that everywhere I went, I got really kind of, yeah, just frustrated again after about 18 months of being in a role. I think I had different ideas of the value that in-house legal could bring. And I realized that one of the reasons that in-house legal wasn't really able to add the value that it could was the way that it worked - so, very siloed, didn't really take a user-centric approach to the way that they did their jobs, weren't embedded in the business. So I decided to start a company that brought in-house legal to the centre of the business, through legal design, legal ops, and just smart ways of working.

Graeme Smith

So it's been doing amazing stuff lately, The Law Boutique, so well done there. And in the early stages, did you have any significant challenges and how did you overcome them challenges?

Electra Japonas

Yeah, money was a challenge at the beginning, as with any new venture. So, how did I overcome them? I started up TLB in September, 2017. Well, I started a bit earlier than that and I was doing it alongside my job until I got to the point where I couldn't do both. And then I worked solely on TLB from September until February maybe. And then I ran out of money. And so I got a contract with EY and I was doing both TLB and my contract with EY for about six months. And then GDPR hit, and then I got really busy because I was a data protection lawyer. But yeah, kind of just working really hard to do both.

Graeme Smith

That's a good answer, work really hard, I like it as an answer, we could all use that one. So I've got a question for Tom and Electra, as different types of CEO in the legal space, how hard is the transition from employee to employer been for, well, Tom, firstly, how has it been for you?

Tom Dunlop

It is obviously different challenges. I've loved it if I'm honest. I think being an in-house lawyer where you're brought into the room, they're talking about juicy, strategic conversations. And then they look at you to say, can you just tell us all the downside, and you're like, oh, but I contribute a lot more than that. So, I'd like to think I've got a very creative aspect to me as a personality and so then the way that I used to approach my work. But I think there's a lot of transferable skills in terms of problem solving, taking a lot of different variables and ultimately just making decisions quick. I think I just like the freedom of not always having to be the downside and risk voice.

But there's obviously a lot of other challenges as well, like Electra alluded to earlier, just running a business is hard and balancing cash, balancing growth, people. It's a whole load of challenges that you might not have had before. But overall, I've loved it.

Graeme Smith

Electra, how did you find it?

Electra Japonas

It was tough to not get feedback from anyone. That was the biggest thing for me. So, when you've got a boss, they tell you whether you are being a bit crap or quite good. So, you've always got someone that you can have as a sounding board there. When you're just going it by yourself, especially for me at the beginning, it was really hard to get that feedback. And it just creates this level of uncertainty and insecurity that you need to just get over. So, that was the thing that I remember at the beginning.

But the other thing that I remember is that it was really liberating to just do something that you're creating and not having to constantly think about whether what you are doing aligns with someone else's vision or business or strategy or politics.

So, it's obviously more stressful to have a business than it is to have a job, but in a different way, in a way that's more manageable because it's just you. And you're not relying on other people to tell you what you need to be doing or the parameters in which you need to be doing it.

So yeah, those two things might sound a bit abstract, but those are my takeaways from the early stages of when I started up TLB.

Graeme Smith

Okay. So Tom and Electra, it's no secret that lawyers are often a bit sceptical about technology and the change that it brings. Now, you're both disruptors in the legal space and outspoken critics of the way contracts are done currently. What is the biggest objection either of you has faced to your way of thinking?

Electra Japonas

I think lawyers, old school lawyers particularly, think that everything that they do is really, really special. And so therefore needs to be bespoke and needs to be done manually in a very artisanal way. And I think that now we're coming towards more thinking around… we're more open to thinking about how to scale the things that we do as lawyers. So, taking a contract and drafting it from scratch with your red pen isn't really going to work as a scalable thing to do. And I think people are now looking to technology and standardisation as a better way of doing things.

Tom Dunlop

I agree. I think the, I guess, traditional legal services industry very much rewards for inefficiency. It's been built around trying to deliver a service in an inefficient way is actually great. And actually that's where the promotions happen. That's where the biggest fees are paid. And so when you come with a solution that ultimately scales legal services, I think to the masses actually as well, in terms of making it not just accessible for those with deep pockets, I think when you start to preach that message, it obviously contradicts how the legal industry's built over a number of years. So I think there's that initial resistance.

But I'd like to think that now there's more, I guess, businesses and individuals that, the younger generation coming through, that are leaving law firms, because they just don't like the way that the services are delivered, that are very receptive to that way of working. But yeah, it's a scalability thing versus inefficiency.

Graeme Smith

How important do you think collaboration is to both of your styles of innovation?

Electra Japonas

Collaboration's key to what we are doing. So, apart from The Law Boutique, we're also doing Claustack. And Claustack is a platform where lawyers come to collaborate to create common standards and share knowledge. And I think that's the bit that's really missing from the legal industry, it's collaboration. Collaboration within the community to create better ways of working. And to your point earlier on tech plus people, I think that's also key to any successful tech implementation and rollout. So yeah, we need both.

Graeme Smith

How does transforming the legal process affect the wider business, Tom?

Tom Dunlop

I think the legal process is, I mean, as you say, is one part of a wider process anyway in the business. And I think that it's well known to be a big bottleneck. I'm not sure that many lawyers, whenever I used to work in-house, you're automatically tarred with a bit of a hurdle, you're a hurdle in the business. So, I think there's an education piece, which explains the importance of that part of the process.

And I think that when people start to get their head round, why you do what you do, what you are trying to enable, the fact that an initial high line commercial discussion that reflects how much you're going to pay. And all you are trying to do is make sure that a piece of paper documents that in the right way. And you're trying to make sure that you're protecting the business as well as actually realizing value for the business. Then I do think that people see it as I'd like to think probably one of the most, if not the most important, part of a business. It's where actually all of that commercial discussion, negotiation turns, we turn it into a real live document.

And whenever you've been through an acquisition or a merger or any sort of transaction, that's the point businesses realize how important legal is. And actually it's front and central to pretty much every aspect of value in any business.

And I always go in when I'm an in-house lawyer, and I've been in for the first few weeks, is educate the business and basically say, every single value, every bit of risk is attached to something that legal touches. So in theory we're the most important part of the business. That's what I like to think anyway.

Graeme Smith

Electra, what do you think?

Electra Japonas

Yeah, for sure. I think legal in the middle or a legal first approach is really important. And we work with loads of scale up and startups. And I have first hand seen that the organizations that succeed the most are those that take legal seriously and take a legal first approach. So, you can't put yourself in that position as legal, if you are not taking a human-centric approach to the way that you are delivering your services and if you're not collaborating. So yeah, I'm with you, Tom.

Graeme Smith

As a modern day CEO in the legal space, I would say it's pretty fair to say that your personal brand is the business' personal brand. Both of you have been busy building a successful company. But have either of you thought specifically about how you've built your personal brand alongside your business? Electra, I thought I'd put that to you first.

Electra Japonas

Yeah, I think it's important these days, particularly with social media. LinkedIn is where all lawyers hang out as well. So, it is important to work on your personal brand and to put forward the image that you want for yourself and your business because it does, it helps massively. And so you need to think about your tone of voice. You need to think about the things that you're talking about, the engagement that you are getting. And just being a bit smart about what stuff you're putting out there and what type of engagement you're getting from which audiences.

Graeme Smith

So how would you describe your personal brand?

Electra Japonas

God, that's a hard question. I dunno!

Graeme Smith

It's a tough one, isn't it, when it's about yourself?

Electra Japonas

I know. I feel like I'm weird saying this, but some of the stuff that I say can be a bit confronting I suppose, and potentially controversial because I'm talking about change and disruption in industry that's quite archaic. But I think people engage with it well. And especially with oneNDA, that audience grew quite a lot, so I think that's a good sign.

Graeme Smith

Tom.

Electra Japonas

Awkward question.

Graeme Smith

They were very keen on that in the office actually. They did specifically ask for that. Yeah. Tom, it's your turn to answer that question now. You've been busy building a successful company, a different type of personal brand to Electra's, but what are your thoughts on that?

Tom Dunlop

Yeah, I think I would agree with Electra, I think personal brand is massively important for anyone in industry as well as when you're building a business. I think I always used to have a very big thing when I was an in-house lawyer about what would people say rather than just Tom from legal? Can they articulate three things that I did? And did I actually have a personal brand?

And I think when my story is so intrinsically linked with Summize as well in the sense that a lot of the first things that people say is founded by a GC or founded by a lawyer, then your story does become relevant. And how you portray yourself, what you talk about, how you expect the industry to be, becomes very aligned to what the product's then going to do and how well the products play a part in that industry.

So, I don't think it's necessarily the case in every business that the personal brand of the CEO has to have that influence. But I think when it's so intrinsically linked to the work that you're doing and where the story came from, it does actually impact quite a lot about what people's perception of the products and the roadmap might be.

Graeme Smith

Here's the tough one. How would you describe your personal brand? Come on, Tom. Again it's your own staff have made me say this.

Tom Dunlop

I know, that's the worrying thing. I'm known to be quite a practical, which is not a very good personal brand I suppose, relatable, when they think about-

Graeme Smith

Say down-to-earth.

Tom Dunlop

Down-to-earth, yeah, I don't like to speak in a lot of fluffy language about the future. I like to think about, there's a problem in the industry, this is how we're solving it. It's pretty straightforward. And most people can relate to that problem. So it sounds like… I'm a dad now as well, so I think I'm just practical, relatable, and it's probably very...

Graeme Smith

They're all good descriptive words. Yeah, absolutely. So, for those people starting out in business at the moment, what would both of you say, personal branding, would you say it's an important thing for them to consider if they're starting out on their potential CEO journey at some point, Electra?

Electra Japonas

I think you need to be careful with that because when I first started TLB it was a totally different business, different target market, different product altogether. So, you can think about the things that you put out there. But I would say for the beginning, don't tie yourself to just one narrative. You can tie yourself to a broader philosophy and the stuff that you are talking about can support that. But don't just talk about that one thing or that one problem that you're solving, because you are definitely going to change direction and you're going to pivot and you're going to evolve. So, I'd say just try not to make it too difficult for yourself to move away from what it is that you've been talking about if you need to.

Graeme Smith

Almost don't be typecast, isn't it?

Electra Japonas

Yeah.

Graeme Smith

I feel that you could say that to an actor, couldn't you? What do you think, Tom?

Tom Dunlop

Yeah, I totally agree. I think you touched on it there about the importance of a vision, I guess, almost over and above a personal brand. And I think people talk about visions as ... and a lot of people don't get it right. But I think if you can align yourself to an overarching belief or a way that the industry should be or how the company is driving it, your personal brand can evolve to that story. And you might have one that you go out with, but ultimately it's in the context of a bigger vision. That's more important necessarily than your own personal brand and your own message.

Graeme Smith

Awesome. Well, thank you both very much for taking the time to have a chat to us this morning. Electra, thanks for taking some time out of your busy day. Are you there in the office at the moment or are you at home?

Electra Japonas

In the office. No, I don't live here. No.

Graeme Smith

Office at the moment. No, it didn't look very homely, just a brick wall and a plant.

Electra Japonas

Clinical and terrible.

Graeme Smith

Well, I appreciate you taking the time out. Thanks very much. And you Tom.

Electra Japonas

Thank you.

Tom Dunlop

Cheers. Thank you.

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Legal Disrupters.

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Graeme Smith

Another trend setter talk next time on Legal Disrupters. Right now, Paris is here with a look into how the metaverse and virtual world are starting to impact the way some legal firms are doing business.

Paris Monroe

From gaming to the workplace, the metaverse is making waves everywhere. Law firms are among the new adopters with many getting into the metaverse to buy property and set up law offices. These firms are handling common legal situations in the virtual world, including metaverse marriages and intellectual property issues. Here's one New Jersey based law firm showing off their new offices in a virtual world, designed by the owner's daughter.

Grungo Colarulo

Hey everyone, if you haven't heard already, last week, Grungo Colarulo became the world's first personal injury law firm with an office in the metaverse. Last week, we opened our first office at -36, 150 in Decentraland.

Paris Monroe

The legal industry is historically traditional and risk averse. In fact, some law firms are still hesitant to adopt technology solutions, let alone jump into business in a virtual space. With major investment from Facebook, now called Meta, many businesses are starting to realize the pivot towards these sort of digital spaces.

Essentially the metaverse is a three-dimensional world of the internet with a myriad of applications. Something best explained by this guy. Here's Ben Wood from CCS Insights, talking about how in many ways the metaverse is already here.

Ben Wood

The challenge with the metaverse is it's a very nebulous term. So we've got Mark Zuckerberg's Meta vision of almost like an arcade game that you insert yourself into. And then we've got the more grounded version of virtual and augmented reality, which might augment your life in a very simple way.

My personal belief is that we've already had an interesting step in the right direction with the pandemic because we're starting to live more blended lives. We're working from home, we're coming back to the office. Some of that will continue to exist. And there will be elements of that that will lend themselves to a metaverse like experience.

Paris Monroe

As more and more big brands enter the metaverse, the virtual universe expands. Many compare it to the early days of the consumer internet with the early adopters being the firms that gain the competitive edge in the long run. During the pandemic, many law firms and in-house legal departments switched to a remote way of working and took their business virtual, meeting clients on apps like Zoom. Virtual avatars in online worlds are considered to be something of a continuation of this trend.

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Legal Disrupters powered by Summize. Digital contracting, done differently. With intelligent automation, making your workflows smarter. For more, visit summize.com.

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Graeme Smith

We are nearly done for this week, but we are here every fortnight with more across this summer here on Legal Disrupters.

Paris Monroe

Next time on Legal Disrupters.

Rosie Burbidge

When you're working on something yourself at home, and you don't hear anything for two or three hours, you don't know if that's because somebody's gone off on a massive tangent. Before the pandemic you had to fax, fax was still a thing and it's completely crazy. So thankfully the pandemic killed faxes.

Graeme Smith

We'll see you in two weeks.

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