Charles Darwin is arguably the greatest scientific thinker humanity has ever produced, in that he showed where we all came from and how we got here. In short, he set out the key theories of evolution. But can we take an evolutionary view of legal tech and if we do, what do we see?
The Origin of the Legal Tech Species
Central to evolution is the idea that complexity grows out of simplicity, that there is layer upon layer of growth, driven by mutation and natural selection. Simple organisms evolve into more complex ones as they engage with the changing environment and interact with other species over very long time periods.
The same can be said of legal tech products, if we see a product type as a distinct ‘species’. Also, when we consider the evolution of legal tech products we can take ‘innovation’ for mutation and ‘market response’ for natural selection.
So, does the theory of simplicity to complexity stand up for legal tech? The answer is: yes. Early legal tech, which started as far back as the 1970s – (see the roots of LexisNexis, for example) – tended to focus on what was possible back then: creating digital databases and then developing tools to search them and retrieve information.
This is what one might refer to as being driven by the Library Force (see previous article on the Forces of Legal Tech). And such a move made sense, as this is the foundational layer of the law, i.e. The Law. What better way to start?
Then came some early document management and practice management systems. But these were ‘operational’ developments. The first real step into tools that directly changed how lawyers worked, that improved the production of the billable output, was in eDiscovery. Again, this dates back to the 1970s.
And then slowly things, well, evolved. Databases grew and grew. Organisations such as LexisNexis and what would eventually become Thomson Reuters steadily amassed huge collections of case law. Tools used for managing a matter, for billing, for filing and storing documents all grew too and got better. Some merged together and new ones appeared, seeking out ‘resources in the environment’, i.e. demand.
All of this then blended into, and ‘inter-married’ one could say, with a huge surge in generalist digital tools that swept the planet amid the rise of personal computing in the 1980s, e.g. Word, and then amid the huge information efficiency gains of the 1990s from the internet. Then the world of SaaS and Cloud approaches to legal tech tools steadily embedded themselves.
And then there was something perhaps akin to the Cambrian Explosion, where there was a surge in the number, range and complexity of legal tech products. Its roots go back to the early 2010s, with a notable increase of new tech products coming to market in around 2015/6 – or what this site has always called The New Wave of Legal Tech.
This was marked by several key aspects:
- The initial pushback of the ‘New Normal’ in relation to corporate client buying behaviour, triggered by the financial crisis of 2008/9 and the pressures from CFOs, started to filter through the sector to support the demand for the creation of new tools, especially around automating tasks and improving productivity.
- The arrival of machine learning-driven natural language processing (NLP) software, which allowed tools to be ‘taught’ how to find and extract not just key words from text, but whole clauses. This was a seminal moment as it created tools that could replicate, often imperfectly it is true, some of the work junior lawyers did.
- The growth of rules-based automation tools, whether via document automation that drove efficiency at the beginning stage of the contract life cycle, or more general no-code approaches to automating simple, frequently repeated tasks.
- A surge in venture capital interest in supporting startups.
- A surge of interest in data science, ‘legal operations’ i.e. bringing efficiency to inhouse legal teams, and increased awareness globally of the potential for technology to not just act as a ‘convenience’ for lawyers, but something that could, when combined with new working methods, change the means of production.
And so we get to today. But, before moving to the next topic it’s important to note that if we look back we can see a journey from simplicity to complexity, from basic storage to tools that take on legal labour and become integral to the means of producing billable outputs.
It took about 40 years to get from the early roots of legal tech to the New Wave of Legal Tech in the mid-2010s, and an enormous amount has happened in the few years since then. This evolutionary journey is going to continue – at least as long as the environmental resources (i.e. demand from the legal market) is there to sustain this proliferation of legal tech species (i.e. products).
The Legal Tech Ecosystem
While Darwin pioneered the field of evolution it was for others to build on that work to fully understand and map how large and complex ecosystems worked. And legal tech is also an ecosystem.
In nature very few species exist in a vacuum, nearly all live in a close interaction with many others. I.e. nearly all life is connected to other types of life to survive. The complex ecosystems of the Barrier Reef, or the Amazonian Rain Forest, are classic examples of tightly knit environments where multiple species are connected.
What we have seen in recent years are several things that relate to connectivity. We see this in:
- The growth of APIs – it is now standard for any successful legal tech product to have APIs to multiple others.
- Many legal tech companies are also forming data-sharing / business relationships that go beyond APIs to planning their growth strategy around working together, e.g. HighQ taking the data output of NLP tools.
- The growth of formally organised platforms of tools where the aim is to not just collect tools together under one brand, but to integrate them together into a more compelling offering, e.g. Litera. I.e. what we call platformisation.
- Marketplaces and ‘universal’ user platforms are appearing now in a variety of formats and using differing approaches that include the likes of Reynen Court, Theorem, Thomson Reuters Marketplace, and also Lupl.
- The growth of CLM platforms for inhouse legal teams – and also now the increasingly prevalent mindset that ‘legal outputs’, such as data from contracts, need to be fully integrated into the wider business.
This is evidence of evolutionary development, i.e. once disparate species in a wide-open environment are now coming together to build complex ecosystems where the products are co-dependent on data transfers, and on working inside/adjacent to other products’ outputs. And within and around that we have the no-code decision automation tools, building new pathways to connect things together.
In short, what is happening now is the birth of a true legal tech ecosystem, not just in local markets, but globally.
Does Legal Tech Have A Purpose?
That now leads us to a key philosophical question: does evolution have a purpose? It’s one of the most misunderstood aspects of this area of science. It’s often naturally assumed that there is a ‘direction’ to evolution. We see how humans evolved and we say: ‘There is some kind of destiny at work here, it was meant to be.’
The problem there is that evolution is the result of random genetic mutation and then natural selection based on how that species survives or not in a given environment. I.e. giraffes didn’t ‘choose’ to have long necks. (We could now bring in Richard Dawkins and the selfish gene theory, but let’s stay on target for now.)
And here is where there is a distinct difference with the creations of humanity and evolution at large. Humans can choose to create something. Humans can lead. They can pick a direction and head there. For example, humans can choose to develop powered flight. Nature wasn’t pushing us to do that. People became fascinated by what was possible and then using science and experimentation found a way to do it…i.e. the Wright Brothers.
And now this is where it gets very philosophical: you could however step back and say: ‘But the human desire to explore, to experiment, to see what we can make, what we can do, what we can achieve and improve, is what drove this all forward. This is evolution, it’s just that the people leading that change saw it as a personal project that they chose to do.’
I.e. a person becomes fascinated by NLP technology, and they work in a law firm and wonder if it can be applied to due diligence work. As they set out to build a tool that can ‘read’ clauses they perhaps are thinking of how it will help lawyers, maybe how it will help to create a business that one day they can sell, and they may not at all be thinking: ‘I am part of a much bigger thing that is happening all around me, which is the evolution of the legal tech sector and that in turn drives efficiency across the legal world, and that in turn is a benefit to civilisation as a whole over the long-term.’
They might be holding the big picture in their minds as they build their legal tech product, or they may not. One could argue that it may not matter either way. Evolution on a societal level will decide which tech tools prosper and which don’t. Their creation could go on to become integral to changes far beyond anything they imagined, or it may not.
But, this leads us back to the point about conscious decisions.
Evolution vs Revolution
Every era has plenty of revolutionaries, but rare in history are the moments when their aims can come to life. Revolutions need two things: people who want a revolution and the right conditions. Those conditions are rarely seen, but do, and inevitably will, happen from time to time, ushering rapid change that few had planned for. E.g. the arrival of the internet, or the explosion in smartphone use.
The curious thing there is that revolution is a lot like a species that experiences a set of profound mutations at the same time the environment is rapidly changing, which combined create rapidly accelerated evolution, i.e. a revolution. So, we could call revolution a sub-set of evolution, rather than trying to place it as a logical opposite.
Meanwhile, evolution on the other hand is seen as the ‘slow and steady wins’ approach. But, as mentioned, evolution on a broad scale is rarely planned. Legal tech doesn’t have explicitly defined leaders who are saying: ‘Right, for the next five years all major law firms will do X, Y and Z. They will all use these tools and get to this point by 2026.’
Individuals are leading law firms, and legal process businesses, and inhouse teams, and legal tech companies, but there is no leadership of the market overall. Everyone is going in their own direction, or as much as their environment allows.
Overall, then, sometimes change is driven by those who demand total and rapid movement in the system, other times those leading the change are disconnected from each other and perhaps may not even be focused on what their work is doing to the wider system. Yet, change comes either way. The ecosystem builds, new products arrive, legal tech evolves.
Where is the evolution of legal tech heading? The end of lawyers is certainly not where it is heading, that is for sure. There are more lawyers now than ever before and more come into the world each year. Legal needs grow, become more complex, and more global.
What legal tech is doing is meeting a need for efficiency – as if it did not meet a need it would not survive. The ultimate source of that need may not always be the legal sector itself, but rather wider society and the people and businesses within it. But, in a complex ecosystem what starts in one place filters through to all other parts. And the same is true for the legal world.
Whichever way we go, one thing is certain: legal tech is an incredibly healthy ecosystem and will only grow in the years ahead. And we are many years, perhaps many decades away, from reaching any kind of evolutionary plateau in our sector.
By Richard Tromans, Founder, Artificial Lawyer, April 2021.