[AMA] Jae Um, Six Parsecs 🤓 Feb 18, 2021 3PM ET

:wave: Hello everyone, I’m Jae, the founder of Six Parsecs (research + insights for legal markets). I was global head of pricing strategy for Baker McKenzie & director of strategic planning for Seyfarth Shaw. Mostly people know me for tweeting lots of emoji :partying_face: and writing looong blog posts with lots (and lots) of :bar_chart: charts. I split my time across (1) market insights & strategic consulting for #BigLaw and (2) startup advisory for #LegalTech.

:nerd_face: Recently I wrote this 5-part series on Legal Evolution called #GreatExpectations for the #GreatReset about post-pandemic #legalmarkets and also made this lumascape/market map. People have been very kind in reading and commenting, and some have expressed interest in discussing the series further.

:point_down: I will be answering questions live here in this thread for 3 hours on:
2021-02-18T20:00:00Z.

:thinking: Ask me anything… about #LegalTech (+ #KTech / #RegTech) or #LegalBuy (mostly in enterprise law markets) and I will do my best to answer Qs & share resources.

:pray: Thanks to NY Legal Tech Meetup for hosting & @clang for moderating!!

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Thanks for joining us! A few quick rules of the AMA road:

  1. :wave: Get Involved. Ask a question by replying to the original topic post (a single time) using the blue Reply button at the bottom. Before posting, please scroll through the existing questions to make sure nobody else has asked the same thing! :ok_hand:

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  3. :hugs: : Share the Love. Shoot your shot :basketball_woman:, and then let others get involved. Please hold off posting additional questions unless and until others’ questions have been all/mostly answered.

  4. :stop_sign: DON’T Reply to Replies. Please don’t reply to anyone else’s post or things get messy in a hurry. :ping_pong: The purpose of replies here in THIS topic is to ask the author your questions. If you’d like to discuss a related topic in more detail with others, create a new topic and carry on! :vulcan_salute:

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Ooo aaah! This will be amazing. Thanks Jae!

(PS. Is this a chat AMA? Or a video or audio cast too?)

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( :wave: Horace!)

:sunglasses: We are going full #ThrowbackThursday… straight text #AMA on this forum.

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Amazing! So the QnA will be via text on the thread not Video?

Yep! You can add your question in advance by replying to the main topic, but @jae will be answering by text reply during the event. Thanks for joining!

A lot of capex is unnecessarily held up in law firms in IT (eg service desk), Administrative (eg client intake) or Financial (eg billing) systems and services that are not a core competency to firms and could be outsourced for cost savings and increased efficiency. It’s a no brainer. Why aren’t they doing this more aggressively? And, where would law firms who take advantage of this do best in redeploying freed up resources?

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A question related to Carlos’… Some large firms have established a captive alternative service provider service (ALSP). Why do you think some firms do and others don’t. From the ones I know about, I don’t see a pattern. [Carlos asks about lower the cost of business services. I ask about lowering the client cost of legal services.]

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If you are a corporate legal services provider, you have constrained resources, and expanding demand, what questions would you try to answer to develop your value optimization process hypothesis?

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What is the dumbest thing we do in the legal work value chain that is generally accepted practice and that we think is smart? And why?

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Who is the best character in “The Wire?” What is the best season of “The Wire?” With which “The Wire” character do you most self identify?

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You have seen the inner workings of law firms from many different perspectives, operating a very different scales. How should buyers be thinking about changing their engagement with law firms to create more shared value on a sustainable basis for both buyer and firm?

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@jae

Long-time listener, first-time caller. Love the show!

Should more law firms fire more clients? Or, more accurately, hold the line on pricing in a way that makes deselection more likely?

If so, why and why aren’t they doing it already? If not, what should they do with respect to their large population of unprofitable clients.

I’ll take my answer off the air.

:grin:

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@jae

Love the #GreatExpectations series. Amazingly well-researched and insightful.

The creation of the Internet and new methods of collaboration made it possible for distributed teams to collaborate on shared technology and knowledge. This embrace of openness in the software industry radically reduced costs and time-to-market for many industries - first software and consumer electronics and then software-enabled businesses in traditional industries a la WeWork, Peloton, Airbnb, etc…

This doesn’t seem to be happening in legaltech, however. While we’ve seen an explosion of vendors, most are closed platforms and the growing balkanization of technology is arguably a growing barrier to more transformative innovations. Is legal somehow different than past industries that experienced their 4th industrial revolutions? Can we realize true digital transformation without more organic collaboration and openness? If not, who do you see leading that push for mutually-beneficial standard setting and openness?

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@jae In terms of alternative billing models, what role do you see subscription billing serving? Are there specific types of firms and practice areas that are better suited for this model? We see increasing success with subscription billing among our customers that are small law firms. Do you see a path for this in the future with larger firms and larger clients that want more predictability over costs of certain types of transactions?

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Re: performance dispersion across sectors, in Part II you state:

In 2021, industry-focused go-to-market approaches remain relatively rare among legal service providers, but the ravages of COVID-19 provide strong inducement for law firms to revisit the sector composition of their client base. For new entrants (e.g. LPOs, ALSPs, and, not least, Big 4) as well as legal tech players targeting the corporate legal function, divergent macroeconomic pressures across sectors should provide a much-needed roadmap to inform all-important questions in targeting and prioritization.

I’m curious about the expected time horizon here. How long should firms expect it to take for such strategic GTM targeting to bear fruit? As how does that time horizon relate to the permanence or transience of the underlying performance dispersion driving the strategic choices?

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Given the overall bullishness on ALSPs, the observation that “many incumbent firms…may be better served by…investing in core rather than frontier tech” (both Part IV), and the perennial, well-known difficulties of selling tech to law firms generally, should more legal tech cos be considering/pursuing a services/ALSP-like model, rather than trying to sell their tech at all? (i.e., building a service offering around their tech that can then be marketed either to the firms as a partnership opportunity, or directly to clients in competition with the firms, rather than clinging to the traditional ‘software company’ business model) ?

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Let’s go meta for a second. In the words of John Maynard Keynes (lol), “Successful investing is successfully anticipating the anticipations of others”. Question: In your opinion, what are the correct/incorrect anticipations we within legal innovation/legal 2.0 seem to continually make re: the legal market? Said another way, does legal innovation have any “first principles” from which we can invest/do collective sensemaking from, moving into 2021?

(On Part III - podcasts got me reading slow)

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Your analysis is second to none. Thank you for your tremendous efforts.

Two Questions:

  1. How do you envision the regulatory environment changing or not for how legal services businesses can operate in the next year or so?

  2. What have been some of the best sources of data for your analyses?

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The data source question is exactly what I am curious about as well.

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