TLH Ep. 39 Scaling Up: Clio’s Mid-Market Momentum and the Future of Legal Tech
Hello, Legal Helm listeners!
Today, we’re thrilled to have Joshua Lenon join us—Lawyer in Residence at Clio, a leading practice management platform trusted by over 150,000 lawyers worldwide. Joshua brings a unique blend of legal expertise and technological insight, actively bridging the gap between legal practice and tech innovation. He works tirelessly to educate lawyers on leveraging technology to enhance their practice, while also guiding tech companies on understanding the legal industry’s distinct needs.
In this episode, we’ll explore Clio’s remarkable journey from revolutionizing solo and small firm management to confidently stepping into the mid-market legal space. Join us for an insightful conversation on the evolution of legal practice management and the role technology plays in shaping the future of law. Stay tuned!
Your host
Bim Dave is Helm360’s CEO. With 20+ years in the legal industry, his keen understanding of how law firms and lawyers use technology has propelled Helm360 to the industry’s forefront. A technical expert with a penchant for developing solutions that improve business systems and user experience, Bim has a knack for bringing high quality IT architects and developers together to create innovative, useable solutions to the legal arena.
Our Guest
Joshua Lenon is the Lawyer in Residence at Clio. An attorney admitted to the New York Bar; Joshua brings legal scholarship to the conversations happening both within Clio and with its customers. Joshua has worked extensively to educate lawyers on technology’s capability to enhance their practice, while also teaching tech companies about the unique needs of the legal system.
Bim Dave: Hello everyone and welcome to The Legal Helm. Today I’m delighted to be joined by Joshua Lenon, lawyer in residence at Clio, a practice management platform trusted by over 150,000 lawyers across the world. He brings legal scholarship to conversations happening both within Clio and within its customer base. Joshua has worked extensively to educate lawyers on technology’s capability to enhance their practice, while also teaching tech companies about the unique needs of the legal system.
In this episode of the Legal Helm, I’ll be talking to Joshua about Clio’s bold evolution from transforming solo and small firm practice management to now stepping confidently into the mid-market legal arena. Joshua, hello and welcome to the show.
Joshua Lenon: Bim, it’s great to be.
Bim Dave: great to be here, thank you so for those that may not know, can you tell us what it means to be lawyer in residence at Clio, which is a great title by the way.
Joshua Lenon: Thank you. Yeah, it’s a completely made up title. Um, but, uh, and actually my role changes from day to day, but I joined Clio well over a decade ago um, and was actually their first legal hire. Hire I was and I was brought help with the legal structure and needs of Clio as a business, but instead with understanding of our customers understanding of how our product can improve. Both internally on behalf of our customers and improve our customers themselves. So, I work across many different teams, helping understand the the needs of meat the procedural and substantive needs of our of our customers law and act as act as a the customer internally. Um, raising issues that I think are unique to being a professional service professional service that has also has secrecy obligations. Uh, it’s a tricky line to walk being a law, uh, law lawyer, running a law running law firm and both having both and professional aspects of our career and help me a company like company understand that need to balance those two professionals is a large part of my job. So it might be, uh, consulting on a new feature and how and how it and what use it, and pitfalls that we need to design around. Might it be our customer our team answer questions, question, from customers who quite frankly cover the gamut of legal issues that are issues that are higher. Uh, I frequently I like I am talking with a talked with does, um, housing, uh, housing association law. What does that mean? Right? And together we figured out that I work with our I worked with our market. creating educational material around technology in the practice of law, including our legal trends report, which we’re going to be talking about in a little bit. So, there’s no one. Job description for a lawyer and residence, it’s instead being flexible and being willing to learn from the legal industry as a whole and being, uh, able to stand in on their behalf as we continue to research the intersection of technology and the practice of law.
Bim Dave: I love that it’s, it’s kind of like you’re connecting the dots between the various functions within the business and bringing value at, at each stage. So that’s a really, really nice, uh, nice role to play. And it’s great that they have that, um, experience coming from practicing law and then being this legal tech evangelist, which is actually something that I wanted to kind of get into with you is with your, with like, when you kind of think about your personal journey that kind of led you to, to Clio, I’d love to learn a little bit more about that and how, how you made that kind of move from practicing law to, to getting into the legal technology space.
Joshua Lenon: Absolutely. So I graduated from law school back during the great recession. I. So we saw the global financial economy suddenly have this big hiccup. We saw giant, um, investment banks start to collapse, and we what we saw was. a pullback in the growth grow law firms. Uh, and so hiring class, dismissed out of hand, right? right? layoffs for the first time, uh, in well over a well over a the US legal industry.
And deck, and out so coming out of law school, the worst time become a to become a lawyer. had I’ve been working, general, uh, at the Missouri level and had had made a commitment to my now spouse, about where we were going to move post law school. And so I ended I ended of having to create my own career. I hung a shingle. I. I had up, I had to learn all the different things a law firm from, legal services. I was doing immigration and there were so many so many questions that I just could not answer like, what’s an what’s an appropriate this type of service? Right? Do I charge for charge for council how do I organize my files just so that I can so that I. of them? And I turned to help with that. help and I was and I was to discover two different pieces of software that were cloud-based. It didn’t have a huge startup cost. ’cause every support every other, show, technology software out there had, uh, quite frankly, quite frankly, in costs. Tens of thousands of dollars. as a, a newly graduated solo attorney, that was not an option.
Uh, one of which one of which Clio, which I chose purely based on the fact that they were located in Canada, ana, uh, which is where we where we were uh, and. It turned out to be to be piece of software that enabled not even my files, vi create invoices that were clear and communicated value to my clients. client me and allowed me to share, uh, them, which is really important for a transactional lawyer, like an immigration incur like, here is your product. product, but I was but I was also an. time having conversations with lawyers, legal professionals, um, legal educators, legal regulators in emerging social and those those all to a single conclusion, which is, it’s harder law than practice, to be. It’s never it’s never, going to, uh, we rely we rely to fill the gaps in our legal system in in a way that no other single profession does. Uh, and because of that, over-reliance on lawyers to just fix the system.
It’s just it’s just harder than it and I found when I was using Clio it got easier, there were there were often for improvement in Clio. And that was some of the some of the was really conversations have with the building Clio to the point where they just said, you know, we would really love to have you come and join us full time and, and help keep driving this innovation. Now we can change change. of law for good. uh, I had bad timing time of in terms of graduating. but good timing in terms of having conversations on social media and helping build a community that is fed Clio success to this date.
Bim Dave: Yeah. I, I love that. So having, having the experience of being a client of the product now that you then have the, the kind of, um, input uh, to, shape going forward is, is amazing.
Were, were there any moments on that journey when you, were, when you were a client where you thought, this is, this technology is bringing something or one aspect that really transforms the way that I think about being a lawyer?
Joshua Lenon: Yeah, for yeah.
The client facing aspects of the tool. So as a customer of Clio, uh, again, I was able to organize my case files. I was able to, um, be mobile, which was something that was really helpful to me. I was living a cross border lifestyle traveling quite a bit and I could not take a file cabinet with me everywhere. But what but what I rapidly clients wanted. To handle a good chunk of their legal services electronically. so Clio had had facing features that had a client web portal could log in, they could send secure secure message that were encrypted. they could upload documents, I could share I could share documents, and that that change everything an immigration lawyer where your clients oftentimes are, quite frankly, on different different. having having that sharing access and a single point of connection with them was a huge differentiator myself and and any other immigration lawyer out there. And we’ve continued to build on on facing technology.
That’s that’s good part part of we see success within our law firms. So the client I’m working. been expanded. can now now actually bring counsel. And have in how within your Clio account. we still have that has web access, but we also have mobile apps that are built specifically for a first clients firms and so that they can use things like their camera as a document document scan, than rather than having to track down a fax machine we’ve we so far as to localize the mobile app with different language versions to help expand our customer’s, reach out into different information out and we’ve then we built up, of payment technology that makes it that makes it easier for client access legal services. So when you talk about what, what jumped and junk out really a game changer to me it was it was not that I access. that but that my mike’s clients. have. it. And we continue we can see huge impacts.
Bim Dave: Yeah. No, that’s, that’s really interesting. And, and when you think about that kind of journey that you went on, as, as being a practicing lawyer and some of the, um, you know, like-minded firms that were going through that experience, we can see that there’s been obviously like an evolution of how law firms operate over the, over the last couple of decades.
Um, as they kind of went through that whole paper transformation to, you know, any, everything being electronic and that, that transition, what would you say are the biggest shifts that you are seeing today in terms of how law firms are operating?
Joshua Lenon: So I think we’re we’re seeing a re-regulation, of the legal services, uh, the United kingdom with the legal services Act of 2007. Uh, the launch of alternative business services in 2012, well, arizona and the United States actually creating their own alternative business services. Uh, we’re seeing the need for non-lawyer professionals. To come into the legal system, and as I mentioned before, we, we just we just rely upon lawyers to kind of fill-up the gaps when it comes to legal system and all other industries have diversified a bit more. Um, we see nurses and nurse practitioners and in healthcare for example, to help fill gaps that we normally rely upon to doctors to do and so as as we see the shift to technology, we also are seeing shifts in business models behind law firms and…
Bim Dave: and
Joshua Lenon: how they operate, so it seems like we like we might moving away from law get away actually from what I actually don’t think I think what we’re doing is instead we’re empowering law covering law firms. Um, think differently about how they provide legal services. the idea that you can, um, of have clients come and fill out their own paper. of client intake right, and then create a review and pass that back to that without them ever having to having to your office is a complete game changer in the terms of speed of service and the desirability of clients clients, legal services. So the electronic shift is, is I think, empowering lawyers to think differently about how they about how they operate and we’re just getting started ways to be a lawyer and run a law firm out there.
Bim Dave: Do, do you think that, that, have you seen any regional differences on that front in terms of either the way, um, they approach technology adoption or just general mindset?
Joshua Lenon: Yeah I mentioned we’re definitely seeing, um, a shift we shift. uh, how how.
High street firms operate there. they’re they’re lucky. to try and go it alone, yet they’re still Maintaining their independence. And this is something that I think is really interesting. We’re, we’re seeing the rise of, um, kind of legal consultancy. Where, bear,a um, firm they’ll have, they’ll out their their location and people walking in off the street and hiring them. But then they’ll also be partnered with a network of other law firms in a, a very formal arrangement, uh, where wear marketing, client referrals are, are starting to pass back and back and forth so we’ve seen, this kind of informal network for a long for a long time. the legal industry. Uh, it’s Uh, it’s actually why we have like barristers chamber, Let’s all right? Let’s all get together, hang out we’ll, and train we we’ll train each other. we’re And now we’re seeing chronic transformation law, empower Not just within my local community, but within my state, within my nation. and different types of Of firm support services come out because of that as well. And it’s very interesting to interesting. we’re pulling this all together and all the Different different, seeing these informal networks become formalized via and what we haven’t invented yet in that space.
Bim Dave: Yeah. Yeah. Ma makes a lot of sense. Um, what, so when you think about some of the, there’s a, there’s a bunch of different, different technologies. I think you touched on kind of the client focused technologies, um, and there’s a whole bunch plethora of other solutions being brought to market at the moment.
Which one would, which from a technology perspective would you say are actually genuinely transforming the practice of law?
Joshua Lenon: So, we’ve had, I think, three stages that are genuinely transforming the practice of law. Uh, the first of which was…
Which would cloud
Joshua Lenon: uh, web service transformation where we’ve gone from law firms either having to maintain everything in paper or, uh, actually become their actually become centers center and run and run servers from closet in the in the back, able to shift right? And that’s enabled us to start having, uh, distributed law firms, uh, the ability to work from multiple locations.
We paired that with gears that wave, which is mobile technology. Um, and we’ve made legal services now accessible, not not just from a desktop computer or a laptop, but also from tablets and mobile devices, and it’s created created this panel. Instant demand for legal information and a lot of different ways to reach out to clients and prospective clients.
Our Our third undergoing right now is artificial intelligence. one it’s, I know it’s a buzzword right now, now, about it. Uh, but legal is one of, I think, the primary primary industry that and can by artificial intelligence, especially this generative artificial intelligence like we see with chat GPT.
Bim Dave: Indeed some very exciting times, uh, ahead in terms of what it, what it can bring to the table. Um, I, I wanna shift gears a little bit and talk a little bit about some of the recent news with Clio’s, um, um, uh, acquisition of, of share do. Um, but just generally speaking, the, I get the sense that Clios been very, very successful as, as we know in the solo and small law firm segment, but there’s a cl like a clear shift that we can see in terms of the industry where there’s a shift towards kind of serving that mid-market and mid-size firm.
I wanted to like, what’s prompted that strategic focus and how are you adapting your offerings to be able to meet some of the unique needs of, of that segment?
Joshua Lenon: Yeah. Uh, our uh, Jack Newton and Ryan Gre, uh, part of their initial insight was that the s solo and small firm aspect of the legal industry was drastically underserved. again, that was huge startup costs that I was talking about with my own law firm. That was the same, uh, pain point that everyThat every other, with. yet, solo and small firms make up something like 65% of most marketplace, uh, most marketplaces depending on where you look. Uh, and so they new that cloud computing. reach out to them, overcome some of the, the barriers to entry, both for legal technology, software, and for law firms in adopting legal technology.
Uh, and so you’re, solo and small firms were the primary focus of Clio. Uh, but there’s always been a hunger and a demand for better software, not just by solo and small law firms, but also by law firms of all sizes. And so consistently through Clio’s history, uh, we’ve had larger and larger law firms come directly to us asking if our software would be a good fit for them. And it It wasn’t are targeting targeting but that nobody, nobody is. And so them for that good software fit that will help them manage. and we law firms, 20 plus lawyers. All the way up to defined that so much It, it gets a little gray up there, at the as the upper, uh, we definitely see that they have unique workflows, unique needs, um, and unique software management issues that you just don’t see in So, and small law firms.
And so for the so for the last well number of years, we’ve tried to try to be things to all size law firms. we’re building features that we think will help lawyers and mid-size law firms as well as well, law firms. And it it has been a bit of a struggle, right? Because of the unique differences in how Inhouse operating. example is if we take a look take a look trends report, one of the key performance indicators we measure is utilization rate How much of a lawyer’s day is spent on billable work? And for for law firms, it’s a very small amount. We’re talking right around around 29, 30 2% of is spent on billable work.
So, look at their debt inside it’s 52% of their day on average is spent on billable work. work homes. There’s need in these mid-size law firms, uh, for lawyers to have to do things like, um, business development, marketing technology, um, acquisition and and uh, uh, but things things firms have to, have to, And And so we, as we the push pull of trying to be all things to all lawyers, aware. just realized that, that we need to differentiate and look for the for that these that law larger Need. Right. rank.
And we had with have we shared,us that they had a really or idea of the pain points that these that to large law firms have when it when it comes to to assigning work out, account, not uh, another person, but to a teams of people, uh, user management when it comes to bringing on whole teams of people at a time to work on projects. They did they had, great features that we well aligned, of mid to large size law firms and solved some of that some, that we were having Clio and trying to trying to build in even though they weren’t needed by the rest of our user base. those. So the So the acquisition of, share feel is a great chance chance rate growth.
Uh, really good software that is a good fit for a certain class of law firms, while also alleviating that struggle within Clio, uh, of trying to serve both large firms and small firms at the same time. Um, we were we were trying to do Now we can do both.
Bim Dave: That’s very exciting yeah, no, definitely very interesting times. So what, what does that mean in terms of the, how you look at the Clio, like the Clio broader vision in terms of the, the roadmap? So does that mean like there’s, there’s integration happening? Does it mean that they’re two separate offerings? Like I’d love to learn a little bit more about how, how it affects the, the kind of clear roadmap.
Joshua Lenon: Yeah, that’s a, a great question obviously we’re still researching that as well. Right now they’re separate products. They’re Definitely going to be integrations and touch points between them, Um, and there’s going to be cross pollination as well, like good ideas from one will seed good development in the other. Uh, but again, there will be, certain features and requirements that are just unique to the different segments of law firms that are out there. Uh, and so we are gonna are gonna try keep serving those segments separately when appropriate.
Appropriate Uh, one of the things that I think is definitely on the roadmap is we’re going to, uh, see kind of a kind of a of the solo firm that over that of, you know, 10 over 10 years goes lawyer A to now a now, of lawyers, to now part of a, a really large firm that’s successfully growing. Uh, I think I think can now now handle that evolution of an individual law firm up and through different types of software, and we’re gonna make that as seamless as possible.
Bim Dave: Fantastic. Oh, good. Good to hear. Um, so you, you touched on this, um, previously in terms of the legal, the Clio legal Trends report, which I did want to wanna kind of touch on. That seems to have become like a go-to resource for, um, some really interesting facts and industry stats, um, in, in the legal industry.
Um, I remember reading something recently where I saw something along the lines of, um, mid-size, smaller law firms using AI in their practice a year ago was something like 19%, and that’s jumped up to like 93% this year, which is no surprise, but actually, like, it’s really interesting to see how low it was just a year ago and how quickly things are evolving.
Um, and I was interested just to learn from you in terms of what stood out to you the most in the most recent recent edition.
Joshua Lenon: You got it. Uh, a little background on Legal Trends report. It’s not. It’s not a white paper like you’ll see from other legal technology vendors. Um, and the And the reason it because Clio does Lio have a very unique and singular data source, which is the contributed attributed user, from all of our customers. again, this is part of the, the cloud cloud wave wave that I was talking about before. Um, Clio lio for contractual, cannot see our customer’s files, right? No confidential communications, no documents, uh, but but see certain usage statistics in Clio. right. Right. Uh, lawyers lawyers mobile apps to practice law, right? Um, are are they adapting adapting as we turn them on in Clio, that kind of thing, that kind of thing? Very, Very, very high level but across 150,000 plus lawyers, that actually that actually adds up bit of quite. if it did.
So the Legal Trends report is able to use this contributed, aggregated, anonymized an to provide insight into the practice of law law. exist. Right. Right Um, out and I now figure out like what is an hourly rate for an immigration lawyer, Iation lawyer there was nobody to ask, right? Hopefully I knew a couple people and they had good had good but advice, but now Trends report, I can I can actually dive down to the hourly rate lawyer in every state in the US and, and, and walk away. my rate competitive, right?
Am I operating premium service and charge charge more? Um, that’s just an That’s just an example of the Clio is publishing and making available to inside. Everybody that never and you’re right. our last two actually looked at, half the use of artificial intelligence in the practice of law.Law in 2023, it was it was. were telling us [00:26:00] they were using it. Uh, and then when we jumped to 2024, uh, it was right around 79% of lawyers are telling us they use it. then when we look Then when we look at law firms, it’s 92% saying car savings, AI in the practice of law.
And, and this is where I think it where I thinking interesting, uh, amongst the industry as a industry as a whole. like minor adoption. That’s what they describe it as, right? We, Right. We, we’ve dipped our toe in but when we look at mid-size law firms, not only have 92% of these law firms brought AI into AI stack, but close to 40% are saying that they’re using it widely, like every every day, of lots of people within the firm have access to it and can use it as a part of their duties. And so I think these midsize law firms are all all in it comes to adopting artificial intelligence, much more so much more. So, smaller law firms, there’s a uh, There’s a big risk associated with with generative ai. AI Um, and that’s that that. it actually. the, the time and labor that might go a lot of the work product that lawyers generate. these midsize law firms are much more likely to be hourly billers.
Uh, they’re much more likely to have non-lawyer timekeepers that are contributing to, to the invoices. Uh, and what our own internal study is shown is that especially with those non-lawyers, um, their tasks tasks are highly when using generative ai, which can lead to a dramatic reduction in recorded time. And so these mid-size law firms are leaning in for artificial intelligence, but with 70% of their time entries coming from non-lawyer, uh, non-lawyer timekeepers, there’s a real risk that they’re also going to see an attendant drop in track revenue if they don’t adjust their business model to ai. Yeah, and I think we’re, we’re hearing that that has a lot of impact in terms of how pricing will work in future as well, right?
Because obviously, um, with efficiency comes less time, does that mean that the hourly rate goes up to like the thousands or what happens in future? Any, any thoughts on that? Yeah, Yeah, I think, uh, I think, raising the hourly rate is, is something we’re going to see, uh, reflected in Clios own track data, uh, because that’s the simplest solution. I do I do think, start seeing numbers like clients just bulk at like, why am I paying a thousand bucks an hour for this? Uh, and so I think is gonna be the long-term solution is what we’re calling hybrid billing, there’s gonna be a mix of flat fee charges and hourly services on top of that. So, uh, you’re gonna be talking about how you use a trained, uh, AI model that is specific to your area of law and your jurisdiction to create like draft one.
And there’ll be a flat fee for that. there’ll be hourly work as a professional comes in and provides their independent judgment on top of that. And it’s gonna be the mix of those two, right of flat fee, either per segment or per task. Um, and then hourly billing based upon the expertise and the opinion and editing that I think successful law firms will be navigating in the future.
Bim Dave: Do, do you think that this has an impact in terms of onboarding of junior staff in future? So junior lawyers coming into an organization no longer having the exposure of like, kind of learning the basics right, to get up to, to the level that they need to.
Joshua Lenon: Actually, yeah, I think that’s probably the big existential risk from my point of view is that I’m seeing a lot of senior lawyers talk about how, um, they’re able to look at AI output and provide their expert independent judgment to it because of their years of experience. Right? Um, and if we’re not We’re not providing that, to develop that that experience, are going to, I think, uh, kind of age out. lot of lawyers without replacements on hand. I don’t have a
Having, to this, to be perfectly honest. I think it’s gonna come back to the Legal Education Academy build expertise within graduating graduating, evaluating. Laughing Um, honestly, I, I’ve almost flipped my attitude on how legal education should be. Um, for for a long a long time, a I. of experiential legal education, like get in the legal clinics, get the externships, go out for training, contracts like that needs to happen. Uh, whereas law schools would always say they’re training people to think like a lawyer.
And that’s that their primary And I was like, no, that doesn’t teach you how to run a law firm that doesn’t teach you how to write, that doesn’t teach you how to handle clients. Uh, and now I’m the opposite. I’m like, we need to, uh, be training more people to think like lawyers so that they can come out and evaluate this type of generative AI output that needs expert independent judgment to turn it from just statistical gibberish right. Into something that’s useful by the client.
Bim Dave: Yeah, absolutely. I, I think, and I think the, the exposure that you get just from being around, um, experience just is, is priceless, right? Like it’s, it is actually really nice to see you working from an office and seeing actual people walking around and doing stuff, and Even, even a dog. I think I’ve spotted a dog as well, which is amazing.
I love, I love dog friendly offices.
Joshua Lenon: Yeah. Yes.
Bim Dave: But that, that’s the kind of, that’s the kind of place that is the breeding ground for creating talent, right. At the end of the day, because you are, you are kind of listening in on conversations. There’s, there’s aspects of the day where you may not be there to kind of like physically train on something, but you are hearing things, right.
You’re hearing conversations.
Joshua Lenon: Yeah, yeah. There’s this organic growth of knowledge that comes from being a part of these environments, and I think we need to work hard to preserve those. I think the, the guild model of law firms in the past, right, of, of being this professional class that looks after and regulates and, and, and helps train the next generation is going to become even more important as AI becomes further and further adopted.
Bim Dave: Indeed, indeed. So just go back to the report. Were there any things in the report that challenged your assumptions or surprised you?
Joshua Lenon: Yes.
Bim Dave: Yeah,
Joshua Lenon: uh, we look at a, a whole variety of different topics when researching for this report. And again, it’s something that we’ve issued annually since 2016. Um, I’ve been happy to see improvements in those key performance indicators that we talked about over the course of almost a decade. Um, but there was an area an area of in our last legal trends report, and that that when it came to business development and client onboarding. back in back into we did what we call a secret shopper, we went out and we did highly highly um, client outreach a thousand randomly selected law firms.
Um, and just just received the worst customer service, right? No responses from over 60% of the law firms that we reached out to. to um, Uh, unin informative responses for most of them. We ended up actually ended up actually having to 500 just to get a response, and the majority of the already was nobody answered the phone.
So that was So that was 2019 and we thought, But Shirley now, right? Um, we’ve had, had, a global pandemic, but a huge adoption of technology within law firms, And should be client onboarding experience. And so we again, unleashed, uh, shoppers shoppers on five selected law firms. They weren’t firms. They were it was just completely random, highly highly targeted. for uh, requests requests for. And in every Every metrics, metric book metrics law firms performed worse worse than they did in 2019. The only thing they improved on was, uh, the ones that we reached out to via email and got Tim got back to us slightly faster. But Well, but they were worse at, uh, providing information on how to hire that hire up worse on providing on providing it was like to work with work with them. Um, do I need to come to I need to come to Can we communicate the gate video
They were worse on providing estimates or any type of pricing information. it just was disheartening. fact, back, up or 73% said they would not recommend the law Commend reached out to, which is law firms just creating this bad word of mouth for themselves, um, from people for people who hadn’t even hired left. Much less,um, Um they were providing legal services. So the, the a couple of couple of shiny points, their phone tend to be rated better. Uh, firms uh, firms that had a chat bot, were actually actually the rated. And so need to have second half. where people can reach out to you. Feel like they’re being their, Uh, and uh, so like, something, like 51% of clients we’ve clients, wethat a chat bot is actually a decent place to start when researching a law firm. Uh, but 61% said they wanted to have have some type of S pathway talking talking to a right?friend, like an appointment once we figure out like, you’re the type you’re the type of offer So, yeah. Uh, unfortunately, law firms are just not bot their there for people who are seeking legal services. And we can do better. And technology is there to help us do better. just have to like actually start using it.
Bim Dave: Exactly. Embrace it. Embrace it. Yeah. So one, one of the things that surprised me was there was, there was a stat around cloud adoption of LPM software, and I think it was something like, uh, a very high percentage, like 70 plus percent of smaller firms, um, doing it today and, and happy to do it. But when you start to move up in the mid-market and mid-size firms, that percentage drops quite significantly.
Um, I thought, I found that quite sur surprising. Um, but I guess that as the firms get bigger, the, their appetite for, for risk and they, I guess they see that as, as risk in terms of moving some of their information to the cloud is, um, it plays a part in it. Are you seeing, are you seeing any shifts in the, in the direction where that’s changing and, and what kind of things is Clio doing to.
Like kind of reassure, reassure that kind of segment that actually you’re probably better off from a security perspective by moving to the cloud, um, than where you are today.
Joshua Lenon: Yeah. We have hypotheses on why these larger law firms aren’t moving to the cloud or haven’t yet. Right. Um, part of it’s security, right? And concern about confidentiality. Uh, part of it is just switching costs. Right. It’s harder to move a large group of people onto a new tool. And so, um, we’ve actually had to deal with, um, this kind of, there’s a phrase in the tech space, fear, uncertainty and doubt fud, um, about technology. And we’ve had to deal with FUD about cloud technology the entire time Clio has been in business.
Uh, I’ve had I’ve lawyers out. tell me it’s malpractice to store your information in the cloud, um, and then carry all of their client files in a briefcase that they leave on the train. And so with no way of recovering them or locking them down. Uh, and so it’s, it’s kind of the Kind of kettle, um, unsecure in this instance. CLIA has done is we’ve built a security culture internally. That has paired itself with the best in class technology create, um, honestly, the best honestly. dollar for dollar that any law firm can buy. So examples of what we do, um, every Clio employee undergoes a background check. To see their appropriateness for handling any type of technology or confidential information.
Uh, we then use, um, best in class data centers with incredible security measures that are auditable. So it’s not just that we see them once, but they’re audited on a daily and sometimes hourly basis. We have whole teams that are focused on threat detection at an individual level. And so if someone’s trying Someone’s trying to log into your account from Russia, for Russia and you are not based there, that’s setting off sending off right? And our team our into action to make sure that the account is seizure, the customer is notified, right, and that right? all appropriate action with them. And so many more 20 more uh, these actions have all been then brought together together verified by, third parties giving us SOC two. Level security authorization. And what that means is we have both the operations and the technology to keep information as as secure
Now, there’s never ever security, I don’t think, uh, if any vendor tells you they’re a hundred percent secure, they are just trying to take your money to be perfectly honest. Um, but we But we evolving to make sure that we are as close to a hundred percent secure as is technically Technically Um, and we’re even working with our customers on educating them where the risk really come from and what features that we can be building. And they should be enabling. To secure their accounts. Uh, for example, multifactor authentication has been shown to block something like 99% of malicious actions. Uh, and and yet don’t see that widely rolled out in legal technology or widely adopted. Uh, and so we are constantly, um, like evolving our own security features to help with that.
Another other what we’ve done is, uh, I mentioned our client client, uh, and what what these uh, technological security has shown is that passwords are, are just a weak part, right? Um, so many people reuse passwords, and so when it comes to Clio for clients, we’re not asking clients’ were not asking. create yet another password, but instead instead where Magic link technology, where they go to log in. again, provide their email mail and magic may their email that then logs them into the software. So there’s not a need not to have to have to remember. Password. or create a create a risk another password. Password, the same password that password that they meter app. Right. And so between our own, um, internal operations and technology, between our our audits and review by third parties, and by education for lawyers and clients environment for law firms of all sizes.
Bim Dave: very, very interesting. It’s great, it’s great to hear the, the level of investment that goes into, um, just the securing the infrastructure in particular, right? Because I think there’s, there does seem to be a, in some cases a common misconception that actually if you own the data center and you, you own the, the kind of infrastructure sitting within the data center, actually that control, um, mechanism that you just talked about, and the auditing piece is often the bit that’s overlooked, right?
It’s like who actually has access to it and the fact that you’ve got all of the certifications, et cetera, to back that up, um, should put minds at ease. So I’m really happy to hear that. Um, in terms of, uh, other trends that you spotted in the report, is there anything in there in terms of trends that you think law firms might be overlooking at this point and shouldn’t be?
Joshua Lenon: Well, there’s always the discussion of payment technology, um, and what we’ve seen is that payment technology just enables, uh, a flexibility law firms and for clients that has, uh, scenarios. Uh, and so we’ve seen that law firms that are utilizing
Joshua Lenon: Actually tend to get get twice as fast.than firms that are, are hoping their clients write a check. But it also creates a a lot of, that has positive benefits as well. Um, the ability to take, uh, and trust, right? So you’re holding client accounts, um, ease and a more direct and directly that then also programmatically and automatically creates all the all the, and reporting that you need for that. Um, actually remove the hassle of it increases a firm’s realization fertilization rate, and of how much of their recorded an invoice and their and their collection Uh, they don’t have to worry about funds being available. Uh, we actually we actually see. the. technology, um, empowers payment plans Payment plan where where client time. And what we’ve seen for firms of all sizes is it’s a 40% increase in revenue revenue having the by having the ability to pay over over time, so it creates predictable revenue and predictable predict structures structures for
And so law firms are law firms. when they lean into these types of technology. Uh, and then when we Then when we look at budgeting for these law firms, now it doesn’t doesn’t we, uh, can I can I afford actually actually can I afford? When we see the huge return on investment that comes from having things like like payment payment technology, online client portals, we’ve, uh, actually actually out. And, uh, in the US it’s something like $36,000 in additional revenue per lawyer per year just by turning these offering these. features. And so, um, the trends that we see and We to track over time are that see that helps law firms succeed. It’s just a question of, which which of your part of your do you wanna pull a lever on and improve today?
Bim Dave: Yeah. That’s really good to hear, I think. I think that’s actually like an a, an amazing way to look at things because I think a lot of people, when they’re thinking about a technology investment, they look at features and functionality and then try and figure out like is it worth those features and functionality?
But I think you just described it very eloquently, which is there’s a specific ROI that you get from some of those features and quantifying that makes a huge difference in terms of how you see the value of a product, right?
Joshua Lenon: Yeah. Yeah. And for a lot of these softwares out there now, um, it’s almost an instant return. Um, this isn’t a Clio software, but one of our customers was talking about how they brought on an, an AI tool that took a look at their activity per user and found just unrecorded time.
And in the first month alone, it was an additional $30,000 in revenue. And so there’s a a huge benefit. uh, and and the r oi just. Quite frankly, quite frankly, something hadn’t even imagined before. But now we have now we have, and I think the I think the future experience. and, the expertise to bring this to all law firms.
Bim Dave: Yeah, absolutely. Absolutely. So, so just thinking ahead to, to the future, what does, what does that look like for, for Clio in particular, in terms of what, what do you see happening, what’s the next big thing for, for Clio over the next, uh, year or so?
Joshua Lenon: Oh wow. There’s so many irons in the fire to be perfectly honest. Uh, we are continuing to refine our own internal, uh, artificial intelligence tool that we call Clio Duo. Uh, we’re very highly focused on, um, documents and how artificial intelligence intelligence. Improve and improve how with the documents. So we have, that actually will summarize documents, we’ll find information and help you use it. In drafting for documents. We we have a chat chat that helps with communications making character that uh, things that are, are kind of falling through the cracks.
So, a huge amount of work right now going into, uh, to our AI our AI workflow how how lawyers handle it, In terms of our, our own research, we’re now trying to it’s where now where artificial they, really starting to impact productivity. And how law how are going to be adapting for that. Um, just again, to bring it back to legal trends report, um, one of the what was ing. we found is that firms that were most likely to be widely or universally using artificial intelligence were also most likely to be charging flat fees for their entire service.
And so there are firms that have just figured out how to kind of turn on an assembly line and well, that’s not gonna be the right fit for every law firm, for every practice area. I think we’re gonna find more and more evidence of that, of these huge leaps forward in productivity, and we’re looking at, um, can we help identify where those are and can we help build them on behalf of our customers so that they can like seize the advantages that emerging technology has.
Mm-hmm.
Bim Dave: Amazing. Well, looking forward to seeing how, how Clio grows in the future. Um, and any, any final thoughts in terms of our audience who may be, uh, kind of considering a move, considering a practice management move?
Joshua Lenon: Mm-hmm.
Bim Dave: Of things should they be thinking about in terms of preparation for a, a successful move to a product like Clio?
Joshua Lenon: Excellent. Um, we’re starting to see more and more, uh, customers come to us with another practice management software, so they should be looking at, um, what does their contract say about migration? Is there a time that they need to notify their, their current provider and make sure that they aren’t being unduly, uh, renewed into that, but also what are their export procedures? Uh, unfortunately there are a lot of legal tech vendors who make it difficult to migrate off their services and, um, don’t treat the customer’s data as the customers. I’ve been disappointed to see that, um, lawyers have an ethical obligation to maintain files for like years to sometimes decades into the future. Uh, and legal technology vendors need to recognize that duty. so
Uh, so take a look at the contract, take a look at what you can and that, uh, and set your set your timeline around, It’s also, um, really good to make sure from Afin a record keeping perspective that you kind of line of when you switch over. Uh, it’s usually at a usually at a point. I, I’ve done my reconciliation for the month or the quarter, and now I and now I start, rather than rather than across two systems at once, when evaluating providers, I think there are are, that you should be looking for. And the first of which is just simple are they up front of Are they upfront about, um, the features and what the features do? you? they
Are they hands questions, um, quickly and easily? Uh, we’ve actually built actually built in? um, trust center at Clio You know, you can where. documentation. You can take a look at our Take a look at our ask questions, a question. and if we don’t already have an answer for you in that trust center, right, it immediately goes to our compliance team where they can create one for you, right? Uh, and that’s
Um, and that’s that you need. Uh, and the second the second thing they that they should be is the ability to just try the software, right? Um, no providing. Software fit for every law firm. You are gonna have to try it, right? And so are they offering a free trial?
Um, do they have. maybe a month to month? Subscription so that you’re not locking yourself into a three-year contract slip, right? Uh, and so that you really get a chance to kick the tires and make sure it’s the right fit for you and your law firm, I think is very important when it comes to legal technology. Uh, but then once you have data. things lined up, I know how to get outta my current software. I’ve got confidence that my due diligence is done on this potential new software, and now I’m really gonna give it, uh, a, a good test. Then I think the migration itself is simple, and that’s how you should be looking at new practice management.
Bim Dave: Thank you. Really good tips there. Really good, um, insightful tips. So thank you for sharing. Um, so just wanna move to a couple of, uh, wrap fun wrap up questions, if I may.
If you could borrow a doctor whose time machine and go back to yourself at 18 years old, what advice would you give yourself?
Joshua Lenon: I could hop in the charts and go back to when I was 18. Um, I would actually say spend more time learning technology than I did. Like I was, I was a pretty nerdy kid, but I wasn’t, uh, an engineer level nerd. And so, yeah, go and, and learn more about technology because you’re only going to apply those lessons going forward
Bim Dave: Good advice and yeah. That would say that would save, save a lot of hassle when you’re putting your IKEA cabin cabinets together.
Joshua Lenon: Exactly.
Bim Dave: Yes. Yes. Um, uh, secondly, what’s your favorite travel destination?
Joshua Lenon: Ooh, really been enjoying New York City lately. Uh, I just, they made… is gonna sound weird, but they made this.
You can’t just pile your garbage out on the street on garbage collection day. And, and for me, it has transformed the city, uh, because now, um, every part of the city is just this wonderful place to stroll with energy and vibrancy and, and lots of opportunity to interact. Uh, as before we were kind of dodging the mounds of garbage bags. Uh, and so New York City is definitely one of my top choices.
Bim Dave: Excellent. Yeah, that’s actually one of my favorite cities, cities. Um, as well, I lived in Philadelphia for three years, so my wife and I used to take, take the Amtrak to New York at the weekends and spend a lot of time there, but I remember that exact challenge navigating the, the garbage, uh, garbage cans was, was a challenge for sure.
Um, thank you for that. Um, any final closing thoughts for our audience?
Joshua Lenon: I think there’s never been a better
Uh, there’s lots of change. lots of uncertainty,
Joshua Lenon: Are the places where lawyers thrive and, and we’re definitely where people come to. In times of change and uncertainty. So you get to now decide what type of lawyer you wanna be going forward, and that’s a freedom that I don’t think existed up to this point. So there’s never been a better time to be a lawyer.
Bim Dave: Fantastic. Great, great advice and great wisdom shared today. Thank you so much for your time, Joshua. really appreciate it.
Joshua Lenon: Thank you, Bim. It’s been great.