The Challenges of Selling Legal Tech – The Vendor View

Selling legal tech is a tough gig. As explored earlier this week, there are numerous challenges. This site asked a variety of vendors what they thought, namely what was the greatest challenge they faced in trying to sell their product and then how they overcame it?

As you will see, there are a range of views and experiences, but all agree on one thing: selling legal tech is complicated.

One factor that is noted by several companies is the billable hour, i.e. if you are offering efficiency tools to people who sell or buy time for a living then you have ‘an interesting problem’. Although, it’s a problem that can be overcome by focusing on the many associated benefits.

Overall there are plenty of other barriers, and every vendor had their own particular challenges and responses. Read on.

Noah Waisberg, CEO, Zuva, and Co-Founder of Kira Systems

At Kira (and likely for most lawyer efficiency tech), our biggest obstacle was convincing hourly billing lawyers that being more efficient was in their best interest. We worked to overcome that through lots of work (e.g., writing AI for Lawyers) making the case that more efficient work can paradoxically mean more hours.

With Zuva, our biggest obstacle is convincing companies that they should license third-party contracts AI as opposed to building their own. We’re trying to overcome this through lots of thorough content and easy access to free trials.

CEO of US legal tech start-up who wanted to remain anonymous

I think selling legal tech is challenging for a few interlocking reasons:

(1) in many cases, the technology being sold simply isn’t good enough yet to achieve quick and easy sales,

(2) the billable hour discourages gains in efficiency, and

(3) the partnership model at many firms makes them try to keep expenses as low as possible so more money can be distributed to partners each year. 

It’s a tough nut to crack. However, our experience has been that once a subscription sale is made, law firms almost never leave.

Helena Hallgarn, Co-Founder, VQ Virtual Intelligence

The challenge in selling legal tech solutions is to build the business case for it – which can be complicated when the business model is the billable hour – and thereafter identify business-oriented management that will understand this business case.

Our solution VQ Legal is an online service that clearly reduces the number of hours spent on producing documents in different kinds of matters. For example, when doing an issue of shares, all the documents in this matter (maybe around 15 documents) can be produced in 15 minutes instead of spending several hours using standard documents.

Initially, some of the firms clearly stated that they still could bill those hours, and therefore there was no reason paying us instead. Other firms argued that young associates needed this training which could be paid by the client. We needed to find business-oriented management that could identify a possibility here in changing the way these legal matters were managed.

Since most bigger law firms now use this solution, and so many lawyers have become aware of its advantages, it has become much easier to sell the service.

Sacha Kirk, Co-Founder & CMO, Lawcadia

The biggest obstacle that we have found when it comes to selling legal tech solutions is that the in-house legal team generally haven’t purchased technology before, and they don’t know how to go about thinking through and articulating their pain points, requirements and business case and as a result they struggle to get budget. Their IT team will also question why the legal team needs their own tech and will urge them to use existing enterprise technology and make do with that. 

We try to overcome these issues by providing a clear path and guide the legal team through the purchasing process and also provide information, use cases and case studies around the benefits of legal technology solutions and software. The increasing presence of legal operations professionals is helping as they are co-ordinating internally and can articular business requirements.

Hugo Seymour, COO, Della

We’ve learnt a lot over the last year or so, but what we’ve always known is that lawyers don’t buy legal tech, they buy solutions that help them do their jobs. Selling efficiency is hard, the benefits are too distributed to make the product an immediate ‘must have’. Focusing on the end-to-end process and the value that generates is a far more concrete selling point.

Our users told us they wanted a legal review solution that supports them throughout the entire legal review process and produces a near client-ready report when they have finished, so that’s what we have built and we’re already replacing legacy review tool implementations in several major law firms and corporate legal departments.

Richard Mabey, CEO, Juro

We sell most often to in-house legal teams in scale-ups. Often there is underinvestment in legal in these companies – both in terms of headcount and tooling, so budgets can be a challenge.

We’ve addressed this in a few ways:

(1) bringing business stakeholders into demos (e.g. sales ops) to ensure that Juro is mutually beneficial to legal and the business,

(2) building collateral that can be used by legal teams (business cases, case studies, ROI models) to make the case internally,

(3) ensuring we have scalable pricing plans, so teams can start small without massive budgeting process and we can prove value to them.

Jim Leason, Agiloft’s new Managing Director for EMEA

The business of law has been and remains a resource intensive business with relatively artisanal practices. Law firms and corporate legal departments are all under pressure to reduce costs, and their biggest overheads are the lawyers themselves.

At the same time, organisations are quickly shifting towards managing their relationships digitally – whether that’s interfacing with customers, suppliers, or dealing with their employees.

The contracts that govern those relationships need to fall into line. While many legal tech solutions, like CLM systems, can deliver efficiencies, improve experiences, and unlock new value with data, while reducing risks; the process of implementing any technology means introducing change to the status quo, cost, and risk. Things that most lawyers are averse to.

As a result, any buying decision can feel like a career defining moment, particularly if the software will directly interface with a lawyer’s clients, as many legal tech solutions need to do. Therefore, it’s critical that vendors demonstrate flexibility and design their tools in a way that enables lawyers to work the way they want to and are comfortable with. Those tools also need to connect with the tools that the organisation is already using, such as Microsoft Teams, Salesforce, etc. Reducing friction to drive adoption.

Haley Altman, Global Director of Business Development and Strategy, Litera

As a former founder, legal is a difficult vertical to sell into, particularly as the firms scale in size, because there isn’t a standard firm structure or procurement process that you can look to, to model your sales process.

Each firm relies on different stakeholder groups or decision makers to evaluate technology and make buying decisions. The evaluation process also varies so you should be prepared to have different ways to show value: demo, pilot, etc. Security and integration concerns can also impact the sales cycle.

Depending on your application and the data stored, requirements shift. It can be a lot to navigate so you have to be agile in your approach and look for ways to continue to refine your processes. You can look for ways to show value that don’t rely on efficiency as the main benefit: profitability, retention, etc., backed by data and metrics. You do have to be crisp on your value proposition, adoption process and security set up. 

As a larger vendor, you have more connections within the firm and better insight into the procurement process. However, the different lines of business still require different stakeholders to move the process forward and more specialised internal knowledge around the specific product and pain point. You still have to show clear value and adoption processes for each piece of technology sold. Integration into other firm systems is increasingly important. 

Julia Salasky, CEO, Legl

Legl’s client lifecycle management platform digitises operations across the law firm. On the face of it, the challenge of selling our software is that it touches on all areas of the firm, from finance, to operations, to compliance and management.

We tackle this challenge by involving stakeholders from across the business during the sales process to ensure that there is firm-wide buy-in, and that the different ROI and value that we’ll unlock for different stakeholders is clearly conveyed. 

Jorn Vanysacker, Co-Founder, Henchman

One key obstacle is the assumption that setup and maintenance are a necessity when evaluating and buying (legal) tech. So often, lawyers, their IT department and/or knowledge managers are still ‘too busy’ implementing another solution and still waiting to get sufficient value from that investment.

We need to overcome that stereotype / dismantle this negative prejudice, as the Henchman team purposely built a dummy-proof solution, in the trusted environment of the lawyer (Word), which doesn’t require man-hours to get the solution up and running. It’s in the product & development’s team DNA to stay away from functionality requiring manual input, as the solution and thus the value brought would quickly get obsolete. 

Joe Borstein, CEO, LexFusion (the legal tech sales consortium)

It’s always [about] focus and attention. At LexFusion step one is always picking companies which we believe are going to be incredibly appealing to legal buyers. We look for things that are better, cheaper and faster than the status quo. When you have a winner like that, and we believe we have many, the biggest obstacle is the focus and attention of the buyers.

[In terms of adapting to that challenge] the team at LexFusion has slowly built trust with many (far from all) of the key market buyers over a combined three decades in legal technology and innovation.

There is no quick fix which allows you to get important people’s focus and attention, you have to earn it. However, one slip up (if we push an idea which is not ready or not good) and all that trust can evaporate.  

Jean-Rémi de Maistre, CEO & Co-Founder, Jus Mundi

Selling to law firms is hard indeed. We’re now also selling to GCs and it’s not really easier.

The biggest challenge for us is the duration of the sales cycle. It’s super easy to get influencers, but then we need to obtain:

  • Approval from several partners because decision making is most of the time collective.
  • Approval from the KM or Operations team that have tight budgets, does not know anything about the needs of our users, and is often centralized in a specific city.

We found solutions for each of the specific steps, but we still struggle to reduce the duration of the sales cycle.

How did we adapt? Under the impulsion of our Head of Sales who experienced the same thing at LexisNexis, we learned to become patient and to work on several prospects at the same time. The sales cycle is still long, but the pipe is filling up and the conversion rate at over nine months is excellent.

So, there you go: multiple challenges, but also hope, ingenuity, and perseverance, and that has got these legal tech companies through. Thank you to everyone who sent in their views.