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From the President: Profit from technology

Cite as: March 2015 89 (3) LIJ, p.04

The legal profession needs to listen to the innovators among us.

By Katie Miller - LIV President

The trend of legal start-ups shows no sign of abating. Legal start-ups are showing the legal profession how change can be profitable and satisfying, with many tapping into unmet demand for legal services and shaping their practices to put flexibility and innovation at their core.

New legal practices in Victoria are not in themselves a new trend. Over recent years, we have seen many new entrants to the legal sector as firms merge, expand and globalise. Similarly, sole practitioners (which some of these new legal practices are) are nothing new. The annual reports of the Legal Services Board indicate that, although the numbers of lawyers are steadily growing, the percentage of lawyers working as sole practitioners has remained largely the same.

What is new is the way in which the legal start-ups are approaching the business of law – it is a case of abandoning what doesn’t work and embracing the new where it does. What works and what doesn’t work seems to be different for each legal practice. And therein lies the beauty of the legal start-up – its flexibility and variation.

Some legal start-ups have found ways of abandoning the dreaded billable hour in favour of fixed fees. Others have chosen to retain the billable hour and instead focus on specialisation. Some legal start-ups focus on flexibility of work hours and others are virtual, operating wherever the principal has a computer and internet connection.

Most of the legal start-ups have identified a niche or gap in the market and are focused on filling that gap. The niches may be an area of law, a specific client demographic or even a new legal service, like court coaching.

I met the face behind one such legal start-up last year – Caroline Lane of Victorian Healthcare Lawyers had successfully practised in large commercial law firms for many years. After deciding she wanted to spend more time with her growing family, she started Victorian Healthcare Lawyers, which specialises in providing legal services to pharmacists and other healthcare professionals. Caroline has developed a productive relationship with an accountant who similarly specialises in providing services to pharmacists. This relationship enables clients to access conveniently two of their most important service providers.

Common to most, if not all, legal start-ups is the importance of technology. Some have built their legal model around the opportunities provided by technology. For others, technology such as practice management software and online precedent databases has provided lawyers with the resources, confidence and security to follow their dreams and start their own legal practice. For one of my fellow councillors, Angela Sdrinis of Angela Sdrinis Legal, online precedent databases are a vital part of legal practice, ensuring that practitioners can be up to date with the latest forms and rules, without the need for the infrastructure of a larger firm.

The legal start-ups are changing legal practice but there is still a lot to learn about them. For example, what other elements of legal practice are being abandoned for the sleeker, newer models? Is the partnership structure still de rigeur or is an independent legal practice the preferred approach? Who are the faces behind the legal start-ups – are they all experienced alumni of traditional commercial law firms or is the legal start-up an option for the new lawyer who has just finished her supervision period? Is the current regulatory model for lawyers encouraging or stifling legal start ups?

These are questions that everyone in the legal profession needs to consider. Many of the legal start ups are experimenting with solutions to the challenges that have faced the profession for years. Just as the billable hour transformed the legal profession, the practices adopted by the legal start-ups could prove to be the evolutionary step lawyers need to adapt successfully to the challenges facing us.

Another common feature of the legal start-ups is their willingness to share their stories and successes. Nest Legal founder and principal Laura Vickers regularly meets with lawyers who are considering starting their own practice to share her experiences and thoughts. The legal profession needs to seek out and listen to the innovators in our midst, like Laura, Caroline and Angela, and learn from them to reshape our own practices to meet the challenges of the past and capture the opportunities of the future.

If you are considering starting a new legal practice, I encourage you to contact the LIV’s Practice Support Line on 9607 9378 or use the resources at www.liv.asn.au/Practice-Resources/ Practice-Support.

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