Who will win the CLM ‘Game of Thrones’? Can such a battle even be won by one company? And is the secret to winning here all about moving beyond legal tech, dropping the word ‘legal’ and becoming a true enterprise software company on the same level as Salesforce?
In this Artificial Lawyer interview with Eric Laughlin, CEO of CLM company, Agiloft, these and other key issues are explored. But first the matter of legal tech companies moving beyond legal.
The argument goes like this: legal tech companies have trapped themselves in terms of growth by thinking that their primary goal is only to serve lawyers, whether at law firms or inside corporates. What they should instead be aiming for is to become the next Salesforce, i.e. an enterprise-scale software company that is so useful beyond the niche it first grew up in that it then becomes essential for the whole business. That in turn opens up far greater growth opportunities.
In short, are legal tech companies selling themselves short by just thinking in terms of helping lawyers? Of course, some companies really have designed products just to help lawyers, but, many have not and what they’ve made could be useful much more broadly.
As Laughlin explained: ‘I think of CLM as part of the information architecture of the company. It has graduated from ‘legal tech‘.’
He then mentioned Salesforce, the Microsoft suite and other enterprise companies.
‘Legal tech companies need to have a much broader view of what they are doing. Maybe our sights have been set too low in legal tech,’ Laughlin noted.
‘Look at Salesforce – they made it easy to share data across the whole company, so it stops being owned just by the sales team.’
He noted that the same needs to happen for contracts: ‘The domain of the contract is not just the domain of the lawyers.’
Artificial Lawyer asked: should we just drop the word ‘legal’ from legal tech if we want all these great companies to have a wider audience and be taken more seriously by management teams that look after multiple departments of a business?
‘I’m all for it, you need to keep reinventing yourself,’ Laughlin replied, but added: ‘It’s hard not to put a label on yourself.’
However, he noted that the challenge is that whenever you say ‘contracts’, the other person in the conversation will say ‘lawyer’.
‘We need to move on to something else, something that is a business asset. The contract is democratised, it’s acted on by lots of people. It’s formed by people other than lawyers. [How we see things] is a very different way of thinking,’ he added.
To hear the full conversation with Eric Laughlin and Artificial Lawyer press play on the video below, where you can hear much more of this as we dig into the key issues. It’s about 15 mins. We also look at how should we define CLM, and why is there so much interest in this area right now?
The other issue is can any company win this CLM Game of Thrones? I.e. in a world where legal tech companies want to be enterprise companies that can be taken up by literally every large business on the planet can there be more than a handful of winners? Or maybe only one ultimate winner?
After all, in an enterprise market what tends to happen is a few players take nearly all of the customer demand. Certain types of software become an industry standard. Smaller companies may continue in very specific niches, but generally, a few players dominate – and this is because what they do is of value not just to one team, or one professional group, but creates value for the whole business, and in fact, potentially any business.
While it’s clear that Agiloft is seeking to be one of these winners in the CLM Game of Thrones, Laughlin said that he didn’t see it coming down to just one winner.
‘There are enough companies buying CLM software right now, so I don’t think we will see just one company dominate, not in the next three to five years,’ he added. ‘There won’t be a Microsoft-type of takeover [of market share].’
But then the question is: of all the CLM companies in the market right now, including ContractPodAI, Evisort, SirionLabs, LinkSquares, Icertis, and others, which will become part of the ‘short list’ that every business one day looks to and which will not? The CLM Game of Thrones clearly is very much in its early stages.
[ Main pic: AL adapted image, original image by Elroy Serrao, used here under Creative Commons licence: Attribution-ShareAlike 2.0 Generic (CC BY-SA 2.0), https://creativecommons.org/licenses/by-sa/2.0/ ]