LawTech and Lawyer 2.0
LawTech (that is, technology aimed to support, supplement or replace traditional methods for delivering legal services) is viewed with a certain skepticism. It appears to be followed around with a permanent shadow which whispers “yes but you still need a real lawyer” at every available opportunity.
Yet 2019 is seeing LawTech being done well, really well, because unlike the majority of its predecessors it’s not techies trying to build something legal or lawyers trying to build something techie — data scientists, product experts, lawyers, marketing professionals and developers are all joining forces to push the boundaries, identifying what parts of the legal process can be automated, to create easy to understand tools and documents that can be made available to the non-legal world. Nobody is trying to replace the human lawyer because legal technology can do so much more than they ever could. By way of example, in a US study conducted last year, 20 top corporate lawyers competed against an AI in an error-spotting test across a suite of non-disclosure agreements (NDAs). Responses were measured by time and accuracy. The human lawyers achieved an average accuracy of 85%, in an average time of 92 minutes. By comparison, the AI’s success rate was measured at 92% achieved in just 26 seconds.
Having worked in a team that has brought to life a LawTech platform, I can now say that in our space, corporate venture transactions, the role the human lawyer plays in the actual early stage fundraising transaction (not negotiations) is starting to be reduced. SeedLegal’s intelligent document packs are honed to perfection and the fact that the platform shows ‘the blue sky’ as an output and the human lawyer prefers to draft ‘the blue sky above’ in their version is becoming a thing of the past.
This marks a clear and exciting paradigm shift for LawTech because whilst the pitch for automation being increased efficiency (as shown in the 2018 example above) and user cost savings is indisputable, in my opinion, it’s no longer the real hook.
Data is the real game changer. One human lawyer may accumulate years of experience having handled a couple of transactions a month, but providing open access to live data from 10–15 deals per day across every sector and several geographies, affording users the ability to make better and more informed decisions, that‘s where the real magic happens. Users love peer to peer comparison. Love it. So it’s no surprise that given raising investment is an unfamiliar and scary situation, the biggest source of comfort to them is the knowledge that other similar companies made similar choices and even if parity isn’t the ultimate end choice, they reach that decision knowing what the ‘usual’ parameters are.
Following hotly on data’s coat tails is accessibility. Understanding material contractual terms (in simple language) and being educated on why they really matter is what’s truly significant here and even more importantly, it’s what the audience wants. Being able to do this at anytime from anywhere is just the icing on the proverbial cake. As much as it pains me to say this, and it does pain me because I’m a purist at heart, the truth is that the physical contractual deliverable is now almost incidental. The art of the deal, intelligent negotiations and a frank conversation about the longer term implications is where it’s at and has without question, more perceived value.
Confidently I can start to hush the whispers that LawTech users “still need a real lawyer for legal documentation”; the statement may have been valid 10 years ago but it’s becoming more dated and incorrect. The truth of the matter is it’s the LawTech sector which “still needs a real lawyer” and herein lies the real challenge. The legal profession needs to produce them and the startups need to listen to them. It’s an exciting time to be in this space.
