“It has never been possible to collect the data before now, about what legal matters ‘should’ cost,” says Jim Delkousis, founder and chief executive of Persuit, a legal technology business. Persuit assists companies in sourcing and comparing proposals for the work they want done by external legal services — and its clients include the US retailer Walmart and the Swiss drugmaker Novartis.
Comparison websites have long been helpful in finding, say, a reliable plumber or a good cup of coffee. But the equivalent for identifying the lawyer best suited to a piece of work at the most competitive price has proved elusive, with legal fees varying hugely.
Many in-house legal teams still fall back on the lawyers or law firms they already know, rather than making use of data to assess which would be best, whether on price or on other considerations. However, new services are attempting to achieve a more objective assessment — by using, and searching, data.
Persuit’s digitised platform allows in-house legal departments to set out the scope of the legal work they need, and to then directly compare competing proposals and pricing from law firms — allowing clients, in effect, to compare apples with apples.
Delkousis, a former DLA Piper partner, founded Persuit in 2016 after discovering how inefficient the process was for in-house legal teams to hire outside counsel.
It was a bold step, but he had started from scratch before. In 2007, when he was a partner at the law firm King & Wood Mallesons (then Mallesons Stephen Jaques), he left to take up a post with DLA Piper in Dubai.
“I stepped on to the tarmac at the airport in 45C heat with my glasses fogging up and I went to the hotel, changed, and went into the office,” he recalls. It was empty of people or equipment, and he was new to Dubai. But, over six years, he built a disputes and regulatory practice with a team of 20 lawyers.
Having realised he could meet the challenge of breaking into a new area of business, Delkousis went on to launch Persuit in Australia.
However, the product release was greeted by “crickets”, as he puts it — an almost nocturnal silence from the legal market, and an apparent lack of interest in data-driven procurement of legal services. So he moved to the US, the largest legal market in the world — and it was there that Walmart became Persuit’s first customer.
In 2021, the business raised $20mn in investment and it now has around 90 members of staff.
Persuit collects anonymised data on prices for legal work. For example, corporate clients may allow law firms using Persuit to see the anonymised pricing of other law firms being considered in response to the specific matter that they have been invited to bid for, Delkousis explains. A separate benchmarking feature allows law firms to see the pricing of their cohort for similar work.
“Law firms have been asking for this level of transparency,” Delkousis says. “Or they say: ‘If we’d known we were that close to winning the work, we would have reduced pricing by $50,000’.”
This can spur firms to become more efficient — or to stop seeking a particular type of work.
The platform has now incorporated several generative artificial intelligence features, including one that summarises the main features and strengths of each law firm’s proposal for clients.
If there is anyone who knows it is easier to find recommendations for a coffee shop than it is for a lawyer, then it is Sean West. He is the co-founder of Hence Technologies, a legal risk management platform that helps companies reduce risks — from choosing the wrong lawyer to anticipating geopolitical volatility — as well as the founder of DecafLife.com, which reviews decaffeinated coffee brands.
“People rely on lawyers for some of the most important challenges in their life, from litigating over stolen intellectual property [to] settling insurance cases,” West points out. “We can get more information about a cup of coffee than about a lawyer we want to hire.” Hence has raised $5mn of funding for its legal comparison service so far, says West.
Its software uses AI to process large volumes of geopolitical, legal, and operational data from structured and unstructured sources, developing a knowledge base on which the technology learns.
Despite this, senior legal officers will often still choose a lawyer or firm based on instinct and past experience, says West. “You might choose a lawyer because they prioritise you and always take your call,” he says. “But it’s not usually as a result of data analysis.”
Hence Technologies allows corporate clients to share with colleagues a quick, confidential rating of each interaction they have with external lawyers. “We have [a] thumbs-up and thumbs-down,” West explains. “They don’t have time to fill out surveys or reports on each external counsel interaction.”
This can help legal departments under intense pressure to improve processes — especially to rein in costs and demonstrate they are getting value for money.
However, companies’ legal teams can use data such as Hence’s in other ways, too — such as keeping track of their own corporate knowledge as in-house lawyers move to new jobs. Similarly, the data can help in weighing decisions about hiring external law firms that are focused more on ethics than on cost. For example, a company that is proud of its environmental record might want to avoid a law firm that also advises big polluters.
The increasing power of technology for search makes it possible to locate lawyers with specialist expertise in niche areas, from intellectual property in China to cryptocurrency.
New York-based Priori Legal finds external lawyers that can work on specific projects, vets them, and uses an algorithm to match work requests with firms or individuals. These requests could be for “a specialist in drone law, for example,” says Basha Rubin, chief executive and co-founder of Priori. Generative AI means it can “deliver more information, more quickly, more clearly — and make it more actionable than ever before”, she adds.
Priori Legal has near 50 employees and has raised more than $20mn from backers, says Rubin. She argues that law firms will increasingly rely on a cadre of more flexible lawyers coming into companies to supplement a core in-house team that is very close to the business. “Now, it’s much more strategic,” she observes.