Artificial Lawyer spent 12 happy hours at the Legal Geek Conference on Brick Lane in East London yesterday and can confirm to those who might be wondering, that yes, this was the best legal tech event of the year.
The success of the event was very much driven by entrepreneur, Jimmy Vestbirk, who created Legal Geek and set the tone from the get-go, with a great Truman Brewery space for the event and mandatory high fives to the attendees sitting on either side. There was also a no ties policy and that deserves a special commendation.
What set this event apart from others was that the speakers were the real thing. They were the founders and/or senior staff members of the legal AI companies everyone else is talking about. And they were legal tech investors who have really been at the sharp end of helping entrepreneurs turn ideas into systems that lawyers really want to use. They were also people with a genuine passion for how technology will change the practice of law in a positive way and increase access to justice.
After over 12 hours of listening to speakers and chatting to legal tech companies who attended, Artificial Lawyer cannot cover everything that went on, at least today. Instead, here is a focused piece on two key themes, AI and start-up investment.
The AI session had, among others, speakers from three of the leading legal AI companies operating in the market at the moment: Noah Waisberg of Kira Systems, Jan Van Hoecke of RAVN and Richard Belgrave of LEVERTON.
They gave the audience some insight into what their cognitive engine systems did, but also gave some impressions of how they see AI developing in the legal sector.
Kira co-founder Waisberg went straight for a key issue that many lawyers cite: will AI mean less work for them? Waisberg said no.
By using AI-driven document review a law firm’s clients can now review huge amounts of documents in far less time than in manual review. I.e. efficiency allows the process to become broader and deeper and that may require greater input on the more complex aspects from lawyers while the machines zap through the higher volumes of process material.
Waisberg added that when combined with the fact that the economy is continually growing and evolving and there is always more new regulation and law, that lawyers will not be out of a job any time soon. ‘The need for lawyers is increasing,’ Waisberg concluded.
He added that the bills to the clients may be the same as they are now, even if you use AI. Also, the law firm will have provided the client with a better service as it will have analysed far more due diligence documents and hence reduced risk and given the client a better understanding of the merger target. In short, law gets more efficient, lawyers keep making lots of money.
RAVN CTO Van Hoecke took up another key issue: where is all of this headed and how powerful will AI become in the legal space? He noted that there is a lot of hype at present about AI, but then added this did not change the reality of how AI will progress in the years to come.
In fact, he raised the prospect of an exponential improvement curve being applied to the development of AI, just as Moore’s Law has been applied to processing power in computing.
Van Hoecke saw a world where the level of business intelligence available to law firms and corporates would be so much higher because of AI’s natural language processing (NLP) capabilities.
He rounded off the presentation with a picture of ‘the computers’ who were a group of ladies during World War Two who had to ‘compute’ numerical information ‘manually’, i.e. the people were the computers. Now we have calculators. And as NLP progresses, more and more of the manual processing of legal documents will go the same way.
Richard Belgrave of LEVERTON echoed the point about business intelligence with his presentation on how all of a company’s ‘data core’ could be become accessible to NLP and AI document review/extraction techniques.
He pointed out that the future success of AI and legal tech would depend upon the culture inside law firms. He recounted how he once worked at Linklaters, then left working inside law firms for 14 years before recently returning to Mishcon. ‘Little in terms of technology had changed,’ West noted wryly.
‘Law is archaic, it is analogue, it is manual,’ West said. ‘They are risk averse.’
This was a challenge as lawyers were brought up to expect 100% success and no failures. But, technology is based on trial and error. In which case lawyers needed to become more open to the idea of testing technology and learning how to use it.
He added that in law schools (well, at least most of them), there is little focus on legal tech even though most junior lawyers will spend most of their time using legal tech in one form or other, as well as being the people most likely to be involved in AI-driven document review.
He stressed that tapping the enthusiasm of the younger generation was vital and that law firms could improve tech adoption by creating a ‘group of champions’ made of people in the firm who were excited about using technology. That would help the firm as a whole in the adoption process. Firms also needed to see legal tech companies as ‘partners’ to work with, rather than ‘vendors’ who you just buy from and don’t connect with in a meaningful way.
That said, he is pragmatic and concluded that any tech development has to lead to better client outcomes, i.e. ‘better, faster, cheaper’.
The second main theme that came out of the event was the increasing interest in investing in and/or fostering new legal tech. Legal Geek announced they will be launching an incubator for legal start-ups. Then, the Law Society announced that they also have ‘funds available’ for budding legal entrepreneurs. And then there was a third announcement from Canada’s Law Made by Aron Solomon and Jason Moyse that they too will be launching a fund for early stage legal tech start-ups.
It is not often you hear a hat trick of investment announcements in one day. But, such enthusiasm has been a long time coming and now the conditions are right.
As an aside, David Curle of Thomson Reuters, made a very astute observation about the size of the legal market, that may help to explain why the big money hasn’t been flowing into legal tech as much as one might expect. He noted that the global legal market is worth $700bn, which is all law firm revenues, all inhouse legal spend and all individual consumer spending on legal needs.
Now, $700bn sounds like a lot until you consider that Walmart, the supermarket chain, has revenues of $482bn. I.e. a single retail business produces as much revenue as more than two thirds of the entire global legal market based on a population of 7 billion people.
We can often think of legal as a huge market, but in reality – as several speakers pointed out – the market is in fact hugely untapped. The problem is that lawyers are expensive and will probably never be cheap. Legal tech however can help improve access to justice and generally grow the legal market, in part by doing legal tasks that otherwise would make lawyers too expensive for most people.
The final piece of the investment focus of the day came from Suranga Chandratillake, a partner at Balderton Capital, which is an early stage investor. Chandratillake had made his money in Silicon Valley but chose to come back to Europe to operate in a world where there was a broader view on life, i.e. not seeing everything through a tech perspective.
He added that he is now very interested in investing in legal tech start-ups. He also had some strong views on the state of the legal market.
‘Law looks like a large pile of money where not a lot has changed,’ Chandratillake said. Such a market therefore seemed ripe for Series A type investment in new companies seeking to change how things were done. He noted they had already invested in legal IP company TrademarkNow and was looking for others.
Chandratillake added that timing was everything. He had worked at Autonomy in the past and even though the company had made great strides in early legal tech the market was not ready 10 years ago for major change. Now things are different, he observed. The tech has improved and the market conditions have changed after the 2008 crisis.
However, he warned tech entrepreneurs not to get carried away with dreams of breaking into the legal market unless they were prepared and had first hand experience of the issues they were providing a solution to. Balderton Capital was looking for teams that included a lawyer, not just tech experts, he told the audience.
‘If you have not lived it [it’s difficult to invest in you]. You need a visceral understanding,’ Chandratillake concluded.
There is so much more that could be written about the conference. Artificial Lawyer would also like to note the great presentation by Freshfields associates Tom Hingley and Adam Ryan on blockchain and its future uses. It was also great to hear the views of Marie Bernard from Nextlaw Labs on what kinds of businesses they were looking at. The work of the access to justice teams was also really impressive, with a team comprising the good people from Autto doing a sterling piece of A2J site development. It was also great to meet with Neota Logic, Wavelength, VizLegal, Libryo, Lexoo and many, many more.
Artificial Lawyer will try and write up fuller pieces and likely conduct more interviews with many of the people who attended. But that’s all for now. Thanks again to Jimmy. Looking forward to the next Legal Geek event already.