It is not normally thought of as the most commercially-minded department. In fact, it is fair to say that the law department in a company is seen (fairly or not) as a barrier to entrepreneurship, sales, and both risk and tech-averse.
This is because lawyers focus on the art of the law, rather than the art of the deal. This can put lawyers at loggerheads with sales people and dealmakers. This was put nicely by Tim Dempsey, VC and dealmaker, calling lawyers and entrepreneurs “misaligned” on risk, speed and delivery.
For all such complaints, sales teams rely and appreciate the skills of lawyers, but can remain frustrated by archaic processes.
The answer to the inevitable conflicts lies partly in technological disruption, serving a more entrepreneurial lawyer. Lawyer, technologist and futurist, Professor Richard Susskind, says lawyers faces more change in the next two decades than they have seen in the past two centuries .
This revolution and sales-legal shift is largely due to so-called “LegalTech” software. This new breed of software, not least enabled by “lawyers-turned entrepreneurs,” is servicing the needs of lawyers who have been required to change their processes and interactions with sales teams and entrepreneurs. It plays to new business requirements, such as 24-hour legal service, better data and analytics, and faster responses to tasks which can be automated.
Some 740 LegalTech startups in the market are now servicing daily legal tasks from contract drafting, to review and approval, to AI predictions of court cases. This is disrupting a market where much lawyering remains as manual as pen, paper, post-it notes, and photocopiers. Battling the status quo, LegalTech” has grown to a $16billion industry. There has been a 484% increase in the number of legal technology patents in the past five years as companies look to change the dynamics and dialogue.
And central to bridging the gap between the new commercially-minded lawyers and sales is naturally one software provider: Salesforce, which embodies much of the spirit of what LegalTech companies are seeking to achieve.
Salesforce has sensed the LegalTech boom. It is playing a central role in enabling automation of basic legal services through its reach, success and brand. The company is helping to overcome the main challenge of LegalTech companies. This is the fight against ingrained status quo built up over centuries. Salesforce is achieving this by bringing sales and legal together on the platform.
The Salesforce brandis important to legaltech providers. Salesforce has seen cash flow grow by 17%, and unbilled deferred revenue grow 26%. Dollar attrition — a measurement of the degree to which customers are leaving Salesforce — comes in below 9%. Those creating legalTech software also want to get to a situation where lawyers cannot live without automation, consistency, speed and control when it comes to everyday processes such as contracts, freeing up their time for more strategic work. For instance, previously, data-less lawyers such as Kerry Phillip, Head of Legal at Vodafone for instance now about “data addiction” after implementing new processes. Many point to a future with this data in their hands, the legal team is the most reliable forecast of the next three months of sales in an organization.
The Salesforce magic should also help in bringing the cloud to law — staggeringly — only 37 percent of in-house lawyers say they use the cloud for legal tasks, though this is growing.
It is no surprise that this new sales-legal axis is seeing fast-growing number of SaaS LegalTech companies on the Salesforce App Exchange. These include DocuSign (digital signature), my company, LawGeex (AI contract review and approval to ensure fast approval of sales contracts ) SpringCM and Apttus (document management). SpringCM, a contract management for businesses, has over 500 Salesforce customers managing contracts on the platform. SpringCM has seen a 400% growth year after year since joining the ecosystem.
New legaltech companies are joining all the time: recently, Neota Logic (expertise automation) launched an integration to enable semi-automated creation of sales contracts.
Roberto Facundus, General Counsel at startup Tongal, and previously Global Compliance Attorney at Salesforce, is among those who speak about platform as being central to the in-house lawyer connecting with the priorities of the business. Facundus says: “We use Salesforce for contract workflows, internal collaboration, tracking of contract terms, renewals management, and sharing.
“The business was already using Salesforce on the sales side, so we only had to implement a few additional features through the Salesforce API and educate our employees on usage to capture additional data that is helpful in running the legal and operations side of the business. “
Salesforce has put on sessions for the legalTech players asking more lawyers to use Salesforce in order to turbo boost change and speed up business.
Salesforce CEO Marc Benioff’s vision has long been that Salesforce is not just for sales but an all-encompassing enterprise business management cloud software solution, including Marketing and Service, to HR, IT, and Finance. Now Legal can added to that list.
But even Salesforce will have its work cut out for it when it comes to the law. With decades of inertia, the status quo remains the single biggest obstacle for disruption. The $16 billion size of LegalTech pales in comparison to the $437 billion legal service market as a whole.
In-house legal teams are ahead of the curve, and are sensing that things need to be done differently, with a significant rise in commercially-minded legal operations roles. On the other hand, law firms (the biggest portion of the market) barely use Salesforce — law firm Bird & Bird has moved its client relationship management system into the cloud with OnePlace, built on the Salesforce platform. But, overall, Salesforce has only 5% market share among the law firm world.
What is clear is that the revolution is coming to the legal sector. If this is to be happen sooner rather than later, Salesforce will play a key role in bringing change to the profession.