Technology

These 2017 Hires Show That Legal Tech Is Growing Up

Hires don’t have the eye-grabbing attention of funding rounds or acquisitions, but they’re an important way to assess where an industry is headed.

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I like to say that I was writing about legal tech before it wasn’t cool. Chortle.

When I started writing about legal technology, it certainly was not as popular as it is now. David Lat encouraged me to disregard traffic numbers when it came to legal tech (there used to be a noticeable dip). He thought technology’s impact on legal was an important story whether or not folks were paying attention.

But legal tech is growing up right in front of our eyes — case in point: my list of notable legal tech hires in 2017. Hires don’t have the eye-grabbing attention of funding rounds or acquisitions, but they’re an important way to assess where an industry is headed.

  1. Doug Hebenthal, Chief Technology Officer, Axiom. Axiom announced that they had hired Doug back in October. Even if Doug wasn’t a seasoned tech industry vet who spent time at, among others, Microsoft, Amazon, and Change Healthcare, this would still be a significant hire. Till now, Axiom didn’t have a CTO position. As I’ve detailed before on these pages, Axiom’s go-to-market strategy was a really well-branded legal staffing agency, even as the bigger vision was to industrialize legal services. Over time, Axiom embedded its lawyers inside of Fortune 500 law departments, and the company has leveraged that position to begin building technology-powered solutions for their customers. The hiring of new CEO Elena Donio, a tech industry vet in her own right, and her installation of the CTO position is part of the transition from staffing agency to high-level technology consulting, a sort of SAP or Oracle for the legal industry. And while this hire is specific to Axiom, some of the traditional alternative legal service providers are moving from a pure service model to a service/technology hybrid. Which brings us to…
  2. Alma Asay, Chief Innovation Officer, Integreon. Okay, this isn’t exactly a hire because Integreon acquired Alma’s company Allegory, but this deal was more of what you would call an “acqui-hire” (although Integreon certainly plans on leveraging Allegory’s technology, not just their team). A lot of reasons this deal is significant, including the trend I mentioned above of ALSPs embracing technology as part of their offering, but I think there’s a more important takeaway: the risk of leaving Biglaw to start a legal startup may not be as risky as you think. Alma built the company without huge institutional funding, continued getting customers, and iterating on her product offering. In a perfect world, I’m sure Alma would have wanted to grow Allegory as a standalone company that scaled to hundreds of millions in annual revenue. Most startups (and certainly legal startups) will not sell for hundreds of millions of dollars, and almost every startup has to contend with a imperfect world. Lawyers with big ideas who I speak to are already pointing to Alma as an example of why perceived risk is greater than actual risk. The more lawyers take note of Allegory’s trajectory, the more lawyers will leave law to start legal start-ups.
  3. Scott Sperling, VP of Sales, ROSS Intelligence. I’ve heard anecdotally that legal tech startups in NYC and Silicon Valley cannot convince the top sales people (the Jan-the-Mans of the world) to come work in legal tech. Top sales people want to work at Salesforce and Microsoft, not in legal. Now, I don’t know many faster growing companies than WeWork, so the fact that ROSS got Sperling, who was Head of Sales at WeWork, to come on board is kind of mind-blowing. Andrew Arruda is as charismatic and persuasive as they come, but getting Sperling to join ROSS is a great signal for an industry that hasn’t always been able to attract the top talent. It wasn’t just ROSS either; Logikcull hired VP Finance Evan Meagher away from SigFig and Ironclad hired Jen Pau from Salesforce to be their COO. This will continue being a trend as legal software morphs into enterprise software that happens to be designed for legal departments.
  4. Margo Smith, Chief Legal Officer, Apttus. It’s hard to call Apttus a purely legal tech solution, but their contract lifecycle management solution is designed to overhaul how sales and legal interact, and many of the top consulting firms are implementing Apttus inside of major organizations. Now why is it important whether or not Apttus is a legal tech company and what has this got to do with Smith, a former Wilson Sonsini attorney who was in-house with Marketo for the last four years? When I spoke with Smith earlier this year and asked her if was she was brought on to help Apttus go public, she of course wouldn’t comment. But Apttus just raised a $55 million Series E round of funding that you might as well call a pre-IPO round. Apttus should hit the public markets valued in the billions of dollars, a first for a Silicon Valley-based “legal tech” company… of course that’s only if Apttus is a legal tech company.

So if these hires are representative, 2018 and beyond should see more of the following: (1) services providers embracing (and acquiring) technology solutions, (2) more lawyers leaving law to launch legal startups, (3) top Silicon Valley talent joining legal tech companies, and (4) more legal tech companies going public at billion dollar plus valuations.

Now the fun part — what 2017 legal tech hires did I miss? Email me and let me know. Want to follow the conversations that I publish with legal tech thought leaders? Drop in your email below.

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Zach Abramowitz is a former Biglaw associate and currently CEO and co-founder of ReplyAll. You can follow Zach on Twitter (@zachabramowitz) or reach him by email at zach@replyall.me.

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