Design, intrapreneurs and incubators

Legal design thinking is not new. There are whole conferences devoted to it. However, the recent Facebook/Cambridge Analytica revelations, just weeks before the EU General Data Protection Regulation (GDPR) comes into effect, have catapulted legal design back to the top of the lawtech agenda.

According to BBC News, researchers at Carnegie Mellon University worked out that if you were to read every privacy policy you came across online, it would take you 76 days, reading eight hours a day. There are too many and they are too long, so they are an obvious candidate for redesign. And the GDPR includes requirements that the information provided to people about how you process their personal data must be clear and understandable.

This is not legal design for its own sake, whimsically attempting to turn legal practice into ‘art’; but about applying classic product design principles (that is, the purpose of a well-designed product is immediately understandable) to legal issues. A reworked privacy policy is a good standalone showcase for legal design, making data privacy policies shorter, clearer and user-friendly.

At CodeX Future Law Conference 2018 at Stanford Law School, Margaret Hagan defined good [public-service] legal design as ‘building new tools that don’t creep people out’. She was presenting her Learned Hands project, which uses machine-learning to help more people understand and access legal services, but her comment is equally applicable to data privacy notices. Hagan is a talented artist but you do not need to be an artist for your business to benefit from straightforward design principles, including around GDPR compliance.

Also at CodeX, Arianna Rossi, a PhD candidate in law, science and technology, presented her legal design project, which tackles information asymmetry between customers and companies who use their information. Nobody reads website privacy policies, she explained, but GDPR requires companies to communicate effectively how they collect and use customer data. Rossi’s legal design workshops with designers and lawyers resulted in a series of icons clarifying complex concepts such as data privacy and data protection. ‘Icons are simple – they blend functionality and usability,’ she explained. By adding visualisation to the data privacy policy, Rossi is adhering to a central principle of successful product design – visual perception occupies the largest area of the human brain and people spend just a few seconds on average on a web page.

The GDPR mandates that privacy notices need to be clear, concise, transparent and readable. Therefore, companies will be rewriting their privacy policies – and design is no longer a ‘nice to have’

– Richard Mabey, Juro

 

Design as a differentiator

Richard Mabey is co-founder of lawtech start-up Juro, which provides AI-powered end-to-end contract management for in-house legal teams and has just raised $2m in seed funding. I asked him how he stays ahead of the curve in the crowded contract automation/analysis software market, and his response was that design thinking underpins the Juro experience.

Juro uses legal design to transform contract automation from a process into an experience. This means focusing on the end-user rather than the lawyer. ‘Legal documents should not be written by lawyers for lawyers,’ Mabey explains. ‘Some of our clients send out hundreds of contracts per month. Juro takes the pain out of the process and includes contract negotiation, contract and template creation, and e-signature capability. The machine-learning element extracts key information for reuse – for example, ensuring that renewal deadlines are not missed. But every element of the process is built with the aim of creating a positive experience for the end-user. This is particularly valuable for employment contracts, for example, where it is important for companies to deliver a great onboarding experience – and new employees appreciate it.’

Like Rossi at Stanford, Juro includes icons and emojis where appropriate. ‘The GDPR mandates that privacy notices need to be clear, concise, transparent and readable,’ says Mabey. ‘Therefore, companies will be rewriting their privacy policies. Design is no longer a “nice to have”.’

Design thinking is Juro’s key differentiator, particularly when pitching to corporates that already use contract management/automation. ‘The main reason for replacing legacy tools is low adoption, generally because the user interface is poor compared with the applications that corporate lawyers use every day – Salesforce, Slack, Googledocs etc,’ says Mabey. ‘We compete on two main premises: seamless integration into everyday tools and delivering a great user experience (UX). This means working with our customers and incorporating their feedback.’

Some of Juro’s additional funding will be used for research and development to enhance its AI capability – for example, to suggest improvements to contract design by identifying the clauses that everyone is striking out. However, maintaining a well-designed product also means keeping things simple and not adding too many features. ‘It’s about stepping back from the tools and redefining the problem,’ Mabey explains. He says that one corporate client reviewed 100 contract analysis tools and chose Juro, citing its UX as the clincher.

Innovation and intrapreneurship

Although Mabey observes that you do not hear start-ups talking about innovation, it is still a hot topic for mainstream legal services. But whether law firms, legal technology providers and consultants consider themselves and others ‘innovative’ seems to depend on their definition of innovation.

Although there is plenty of acquisition and divestment in legaltech, even the biggest law firms rarely make big operational changes or replace their management teams unless driven by external circumstances.

Consequently, there appears to be a natural dissonance between law firms’ risk-averse culture and the ‘intrapreneurship’ movement of appointing ‘innovation managers’ tasked with introducing technology-enabled innovation into established law firms. Such firms are more comfortable with innovation at arm’s length, perhaps an AI-powered spin-off or a low-cost subsidiary in a different location.

Another solution to the ‘intrapreneur’ challenge is the increasingly popular lawtech incubators. These often have great names that suggest an experimental vibe and cool workspaces. But, so far, there have been relatively few genuinely different commercial success stories.

Incubators and a new business model

One exception, however, is Taylor Vinters which has produced three successful brands: Wavelength.law, ThoughtRiver and Pekama. Taylor Vinters is a mid-sized firm headquartered in Cambridge and its incubator does not have a ‘cool’ name or workspace. I asked CEO Matt Meyer the secret to a successful lawtech start-up incubator.

The starting point for our innovation agenda was to take inspiration from our clients and their industries. I do not believe law firms can innovate from the inside out – that is defeating the purpose of introducing a different perspective

– Matt Meyer, Taylor Vinters

‘Our clients are fast-growth tech businesses. The starting point for our innovation agenda was to take inspiration from our clients and their industries,’ says Meyer. ‘I do not believe law firms can innovate from the inside out – that is defeating the purpose of introducing a different perspective.’

While Wavelength.law was a breakaway firm, Pekama and ThoughtRiver originated from collaborating with clients to create new offerings: ‘We were not looking to introduce technology to deliver cheaper, quicker or better services – but to innovate value-added products, services and datasets for corporate legal departments which face different challenges from law firms. We focused on understanding what they needed and co-creating solutions.’

As an experienced pilot, Meyer is inspired by the use of automation in aviation. ‘Automation in the cockpit of an airliner drives safety, consistency and efficiency. Of course, it needs to be checked and monitored – pilots treat automation as an extra crew member. The legal sector could learn from that. Rather than railing against automation, we should treat it as a valuable team member who also needs monitoring and supervision.’

Meyer believes that the real innovation opportunity for legal lies in collaboration and co-creation at industry level: ‘Law firm innovation is generally far too proprietary. ThoughtRiver originated at Taylor Vinters but it was spun off as an independent business with lots of law firm clients. That is how it brings value and has the most impact.’

This collaborative approach is producing a new law firm model that is about more than practising law and making money. ‘We don’t have a defined incubator programme,’ Meyer says. ‘It is an organic process. But when we invest in a start-up, we provide space, management support and insight. We want it to succeed. We also recognise that the future of legal is not all about income. Law firms will also need capital growth. The income model is increasingly challenging and capital investment is an interesting diversification. This is not innovation for its own sake; it’s about creating a new legal business model.’

Dominic Holmes, an employment partner at Taylor Vinters, is involved in the Zebra Project, a series of meetings and workshops exploring the future of work, AI, ethics and education. He agrees: ‘Law firms will need to broaden their portfolios as technology and automation shift the business model away from their primary source of revenue: lawyers charging out for their time.’ Taylor Vinters’ culture supports its investment choices, he adds.

‘The fact that we are prepared to have some skin in the game by investing in legaltech businesses and working with them to develop, test and refine their offerings helps us give our clients a more rounded service.’