The statement from Justin Kan appears to raise as many questions as it answers. Have a read of the text below and see what you think, but things that occur to Artificial Lawyer that remain unanswered are:
- How many lawyers have lost their jobs in the restructure? And how many remain in their jobs?
- Kan mentions going beyond legal and quotes the example of the Fundraise Concierge team that helps startups with pitching to VCs, but is that the limit of what ‘beyond legal services means’? What else will be on offer and when? That is not mentioned in detail, although they hint at HR consulting (see below).
- Why did the firm apparently hire people even as late as December 2019 and then reportedly let them go soon afterward? This suggests a little more than a restructure.
- Has the overall structure of the two-part business changed, or is it planned to change?
- Will their legal tech software be sold openly now, as one insider suggested?
- What does ‘Our in-house attorneys will shift to have the option to become preferred providers in our professional services network‘ actually mean? Is this, as one former employee stated, a sort of Uber network for lawyers? Note: as shown in the prior story about Atrium, one person who was a former employee stated that: ‘They offered me to join their platform where I pay all costs & they would take 1/3rd of my billings. No thanks.’
- The reference to helping with ‘how to handle recruiting technical talent in a job seeker’s market’ suggests a move into recruitment support/HR consulting, although it remains unclear how this will be done. Presumably this will demand a new team of professionals to join?
- How much of these new services will be ‘owned’ by Atrium and how much of it will be provided by an as yet not totally defined ‘network’, which could perhaps be as noted, a kind of Uber/freelance professionals platform for giving support to start-ups, but without adding too much to Atrium’s cost base? Note: they state that this network already exists – but it would seem that there is now a strong shift to moving as many professionals as possible onto it, or asking them to leave entirely – at least that is the overall impression.
- Ultimately, is the restructure in fact all about this network model, that shifts costs away from the LLP and onto the individuals providing the services? Who then will also be supported by Atrium’s homemade tech stack?
- And, one final point, did this all come about because the initial model, where Atrium LLP was operating as a traditional law firm in the Californian market, where many other established players already have a dominant share, just not generate sufficient revenue and was draining away the capital that the TLS business was lending to the LLP to keep it operating? In short, did the legal business not make enough money, so they’ve moved to a primarily lower cost network model, which also makes it easier to offer ‘more than law’? Artificial Lawyer has put some of these questions to the firm’s PR team and is hoping to get a response.
UPDATE (10PM GMT) Atrium has kindly answered some of the questions AL put to them, please see below. Atrium’s answers in bold italics. Although, perhaps even the non-answers help to give some indication of what is still very much in flux at the firm, and what has now been nailed down and agreed on. I.e. you can read between the lines here to know what the firm itself is sure of and what is still taking shape. Clearly the plan is still in the ‘baking process’, as it were.
- How many lawyers have lost their jobs in the restructure? And how many remain in their jobs? We will have more information to share in the near term.
- Kan mentions going beyond legal and quotes the example of the Fundraise Concierge team that helps startups with pitching to VCs, but is that the limit of what ‘beyond legal services means’? What else will be on offer and when? That is not mentioned. We will go beyond fundraising counsel. Will have more information to share in the near term.
- Has the overall structure of the two-part business changed, or is it planned to change? We still have the LLP business with partners. We will shift most of our inhouse attorneys as legal providers [to be] part of Atrium’s professional services network.
- The reference to helping with ‘how to handle recruiting technical talent in a job seeker’s market’ suggests a move into recruitment support/HR consulting, although it remains unclear how this will be done. Presumably this will demand a new team of professionals to join? Yes.
Here follows the statement just released (Monday evening) by Justin Kan, Atrium CEO and co-founder.
‘At Atrium, we are on a mission to accelerate the growth of our clients. When we started Atrium two and a half years ago, our idea was to transform the legal industry to become better for both lawyers and founders. For the entrepreneurial lawyers who joined us on this mission, we strived to be a workplace that offered the lifestyle and control missing in Big Law. For founders, we redefined the relationship they have with their legal counsel by providing fast, transparent, and price-predictable services managed through the most client-centric platform for legal applications.
Through my 15 years in Silicon Valley and with each startup I founded, there were always challenges. Even for Justin.tv, in order for it to become the Twitch you know today, we had to make a very difficult and risky decision at one point to pivot our focus and double down on just 3% of our business – the gaming niche where people play solitaire for money.
Similarly, at Atrium, we’ve made the tough decision to restructure the company to accommodate growth into new business services through our existing professional services network. This change impacts our workforce in a couple of ways.
Our in-house attorneys will shift to have the option to become preferred providers in our professional services network. I want to recognize the dedication and hard work of those who are impacted by this. Their knowledge and investment in Atrium over the past two and a half years is invaluable.
We will keep a small group of partners in-house who will serve our clients with strategic services like financing and M&As, as well as work with our network of vetted and trusted firms to deliver general corporate legal services.
This model of collaborating with firms through our professional services network has been an integral part of Atrium’s success to date. The specialists in this network, most staffed by attorneys formerly in Big Law, share our entrepreneurial spirit to deliver exceptional legal services through our technology platform.
Our legal team is continuing to work on existing client projects, and we will make sure that there is no interruption of service.
In our next phase of growth, we will continue expanding outside of legal services as trusted startup advisors by building a professional services network dedicated to founders.
We will continue to invest in legal and are excited to shortly announce new senior partners. Our partners will work with the specialists in our professional services network to deliver exceptional legal services in a fast and transparent manner.
While building Atrium, something also became greatly apparent: founders trust Atrium for advice on how to grow their business – not only surrounding legal but with questions such as when to hire a sales leader, how to best announce their latest fundraising, how to handle recruiting technical talent in a job seeker’s market, and so many other areas that are important to scaling a startup.
We’ve seen undeniable proof that the needs of our customers go well beyond legal.
For example, through our Fundraise Concierge team, we help minimize the frustration of fundraising while maximizing results. We do this by coaching founders — from crafting their narrative and pitch to running an effective process for their business. In just the past year, this has resulted in clients raising over $200M in additional funding.
I love that we’ve seen such great success in sharing our knowledge in this way. This is just one proof point that founders are seeking holistic business services and advice for the key issues they face.
Therefore, we plan to continue to deliver startup solutions through our client-centric platform solving the hardest founder problems through customized mentorship, technology, and a concierge program of expert advisors.
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