ClioCon Day 1: Building the AI-Native Law Firm (Full Transcript)

[00:00:00] Speaker 1: Don't you try to wake up Don't tell me it's just a dream Cause when I've had enough, you'll hear me say now Don't you try to rain on my Perfect day Nothing's standing in my way On this perfect day Where nothing can go wrong It's a perfect day We do not have a live crowd here today, as you can imagine, but we are live ourselves from the Expo Center, the Expo Hall, I guess, at ClioCon. So welcome. Good morning. Good morning, Clio, I guess, as the show is called. We're going to do a little bit of a recap of yesterday. just me this morning, unless somebody, unless, you know, maybe Stephanie wants to jump in, or somebody on our team comes out here, but just me this morning, and do a little bit of a recap on yesterday, and then we'll talk about, you know, what we're gonna do, you know, what we're gonna see today, we're potentially gonna uncover, but then we're, I'm gonna unpack a little bit of stuff. I'll unpack some things that Jack dropped on us in the keynote because there was a lot, not only a lot of information, but a lot of like philosophical things to kind of think about and there are things that that the lawyer's community is gonna address in the coming months, coming days, coming weeks. It is stuff that we've been talking about but anyway we'll get to that here in a second. Day one we obviously saw the keynote, and Jack was talking about AI-enabled law firms. And I think that concept can be kind of thrown around right now in saying that, yes, I use AI, I use AI to draft, or I use AI to do research or something like that, but Jack's talking about AI-enabled, which is kind of like fundamentally from the ground up an AI-enabled law firm. So they released some stuff yesterday, or at least told us about some stuff yesterday. Clio Work and a lot of other AI-incorporated things like Clio Enterprise and then Vincent being worked into Clio Enterprise and how Vincent is going to, Vincent from Velex is going to kind of fundamentally alter how we use Clio Manage. And so, yeah, that's what we're going to talk about here in a minute. I don't wanna get into that too much just yet because Joshua Lennon also dropped the Legal Trends Report on us and we got a lot of good information from there. As always, with the Legal Trends Report, you can find it at clio.com slash LTR. I think it's gonna redirect you to somewhere. Pardon me. Again, we're live, so I don't get to cut the cogs out. but you can always find the Legal Trends Report at cleo.com slash LTR. You can also catch my interview with Joshua, which is going to happen today, not going to be live. Unfortunately, I'm sorry. I know a lot of you on your Pelotons out there riding along to the smooth sounds of my voice are going to be disappointed that you can't do another Peloton ride to me talking about the Legal Trends Report with Joshua Lennon. I'm sorry. Maybe later, maybe another time. Anyway, we're going to record that one, that way we can kind of condense it, get some good information out of it. Joshua is always a wealth of information. He's a fantastic person to interview. So I'm looking forward to recording that one. I hope you're looking forward to listening to that. So we're going to do a little bit of interviews on the LTR. I've actually got John Foreman, Clio's head of products, that I'm interviewing today. So we're doing an interview with John Foreman, and he's going to be a fun one. We're going to talk a little bit about products and data and running your firm using data, being thoughtful about your data. And that incorporates into this overall theme of being an AI-enabled law firm, really, that Cleo is talking about here. So the first theme of the conference is AI-enabled law firm. But the second theme, and this is kind of underneath that, is this idea of, really, I don't know how to exactly say it, but Clio has released enterprise-level software. They connected with ShareDoo, well, they bought ShareDoo, I guess they should, I shouldn't say connected with ShareDoo, but they connected with ShareDoo, which is a, for those of you who haven't heard of it, It is an enterprise level practice management software that's actually out of England, out of Europe. And it has been helping some of the larger law firms there for a while now. So Clio has purchased that product and is looking to take, well, really open up, I don't wanna say move, because one of the fears that we have sometimes when one of our favorite products that we feel speaks to us starts to speak to people with deeper pockets, let's say, is that they're gonna go and only speak to the people with deeper pockets. So we actually have a couple of interviews on that. Stephanie has talked to Jack on that specifically. I talked with Jack specifically on that in the presser yesterday. So we'll have some videos coming out on that as well. But the idea behind that, and this is something that is kind of important to me, because I've talked to attorneys a lot of times, and specific attorneys, I want to caveat this with, some of the most, actually the most tech-forward attorney I know is here, is on Clio, is using in Clio in a fantastic way. And so I don't ever want to say that one really graduates away from Clio in any way. But one of the beauties of Clio Manage is that you can spin it up so quickly and you go from zero to making money using the product in a day at the very least. I mean, it could be hours really. But sometimes people find some difficulty and running larger law firms on Clio. And it's not because of Clio's, of any fundamental problems with the system, it's because these firms have a tendency to set their practices up in a different way, relying more on products like NetDocuments or even SharePoint for their document storage. So there's some other products out there that some of these larger firms need to integrate with, need to connect with, and need to rely on, that Clio hasn't classically had a great interaction with in the way that we would expect or the way that we want. And so this purchase of ShareDo has given Clio that ability. It has made it to where they're able to connect with those firms, really. We will talk about what that means to the smaller firms a little later and in some other interviews. We have addressed that because we at Lawyerist are a small to mid-sized law firm. I don't know, evangelist? Is that the way? Oh, anyway, we coach small to medium-sized law firms. And so those are the ones that are kind of in our heart, the little speed boats that can, as Stephanie says, that can pivot really easily, that can do things very quickly, but that don't necessarily have this massive, massive overhead infrastructure. So, all that to say, one of the interesting things about this enterprise jump, move, addition, addition, let's say addition. One of the interesting things about this enterprise addition is that now, as firms grow, as they scale, and I think that's an important word here, as they scale, they have a place to go within the Clio ecosystem. Which seems like a good thing to me. I don't know how many attorneys are scaling that quickly or that big right now, but I think people want to. That brings me to the overall idea at this conference. The overall idea is the AI-enabled law firm. One of the things that we've been talking about, when a firm or an attorney is so low, a set of 100 attorneys, whatever it is, whatever size you are, when you really incorporate artificial intelligence into your practice from a fundamental level, from the ground up. It is likely. I'm going to hedge a little bit here, but no, I'm not going to hedge here. You are going to save so much time that it will affect your billing practices. When you build your firm around artificial intelligence, instead of trying to slap artificial intelligence on top of your firm, when you build around artificial intelligence, it will save you so much time and effort that it is going to adjust the way you have to build. So when we bring ourselves into an AI-enabled law firm, we have to have to adjust some things here. Okay, this is actually a great place for Stephanie to join me, who has just walked up. We're going to pop her on the mic, and I'm gonna stand up and move the camera so we can see both her and I. So yeah, Stephanie, welcome. We are live here. We'll hear her voice first, and we'll see, we'll see, see how this goes.

[00:11:17] Speaker 2: Do you want me to switch? Sorry, sorry I'm late. You know, late night at Clio, it gets a little, oh, that should work. We had a great night last night. I don't know if you made it, but.

[00:11:35] Speaker 1: I did not.

[00:11:36] Speaker 2: I didn't think so.

[00:11:37] Speaker 1: I did not. I was trying to get my head wrapped around all the stuff we were gonna talk about this morning. Where I'm at, Stephanie, and I don't imagine that you were watching this as you were walking down here. So for those of you, again, on your Peloton, you know, getting your ride in right now. Good morning. So we're talking about this idea that you discussed with Jack in your interview of the fundamental, like building your law firm from scratch with an idea of being AI enabled. And that seems to be one of the themes here at Clio is weaving artificial intelligence into your entire practice. And what I wanted to talk about was that's going to, it is going to adjust the way we build. It is going to adjust the way we practice. And the real specific place I wanted to get to was, it's going to adjust the way that we invest in our firm. Because we kind of have to jump a little, we kind of have to take a, we have to invest, we have to say, well, you've talked about thinking about artificial intelligence and technology as a, as somebody in your firm, you know?

[00:12:58] Speaker 2: Yeah, I mean if you think about the role that your technology plays in your firm, you know, It probably is the equivalent of a $60,000, $70,000, maybe $80,000 or more person on your team. So instead of paying those wages and benefits, you're employing, you're investing in this technology which should allow you to do things faster, easier, better, all of the things if we're doing it right. And I appreciate that that might be a leap for some people because we tend to think of of our technology, of those tools, as costs, as expenses. Right, like we talk about revenue generating expenses, which are typically team members, because they're billing. So this is definitely a new way of thinking about it, is like, this is an expense, but is it revenue generating?

[00:13:52] Speaker 1: Yeah, and I think that's scary for some small to mid-sized attorneys, is that, you know, looking at the prices that they put on some of the products that Clio's rolling out. One of the beauties of Clio, I have thought, or I think a lot of attorneys think, is that with $35 and a dream, or whatever the price is for a specific one-person license, you can get running in like an hour. You can get up and running and billing, and I mean, an hour's probably wrong, but you can get up and running really quickly. And sometimes people go into this because they don't want to take that risk. they haven't made the basic plan to actually start the company.

[00:14:35] Speaker 2: That is a detriment to us as lawyers. Like we, you know, if I were to go start a business today and let's say a typical business is gonna need some funding. So I would go to like the SBA or go to my local bank. They're gonna say, well, where's your business plan? Where's the need for this thing in the market that you wanna do? And how are you going to generate money? I had to do this with my husband's business. I mean, we had to put together, you know, 15, 20 page portfolio before we even got started. And with law, our license just gives us this ability.

[00:15:06] Speaker 1: We just hang a shingle.

[00:15:08] Speaker 2: Yeah, that's what everyone says, right? Hang a shingle, and you just literally are like, I now practice law on my own. And I mean, hopefully we've gotten some malpractice. We've done some basic things.

[00:15:17] Speaker 1: Yeah, yeah, you got your eye on the top.

[00:15:19] Speaker 2: But you don't have to necessarily, to your point, you don't have to have a robust plan, just an idea. and a lot of people are like, well, I'll just, there's a need, or I'm a good lawyer, so obviously I should open a business.

[00:15:31] Speaker 1: I have a passion.

[00:15:32] Speaker 2: Yeah.

[00:15:32] Speaker 1: You know, I have a passion for this. I want to protect the innocent or help people, yeah. And so people just jump into it without really making a plan, without thinking, and I think that means that they're not necessarily willing to sit there and say, okay, well, I'm going to invest this first step and really create this business, And I think that mindset is even more necessary now with the idea that I kind of, I have to be AI-enabled. And if I'm AI-enabled and I'm using this product, then I have to be doing, I have to be getting a lot of stuff done.

[00:16:10] Speaker 2: Yeah, and I think, and I had a great thought as you were talking, now I'm like, what was it?

[00:16:15] Speaker 1: This is the problem with live, ladies and gentlemen. I know.

[00:16:18] Speaker 2: No, but I mean, I guess I was gonna go with this idea of having a plan, having a passion, but not really thinking through your business and understanding that passion, unfortunately, might not be enough. I mean, I hope it is, but for a lot of people, they jump into these businesses without, not just a plan on investing in the tools and the technology, but even who are they going to serve? How are they going to help people? How are they going to help people differently? There's a lot of risk in opening a business and you kind of owe it to yourself. And even maybe you've even already launched your business. Do you have those plans? Do you have a, you know, what we would call a basic business strategy? And if not, you know, it's never too late. That's the good, the good news is, please don't, you don't have to continue down this path. Like you can press pause at any time and back up and say, actually, let me take a step back. And I thought, you know, when I, you'll hear, I don't know when the interview airs, but when I was interviewing Jack yesterday and he was like, if I was starting a firm today.

[00:17:24] Speaker 1: We actually have that clip coming out right after this. So we'll have, if you're watching this, that clip will be on our YouTube and we'll put a link to it in the show notes here.

[00:17:36] Speaker 2: Okay, so when you hear that clip, it kind of freaks me out. Like I'm being honest, his advice might feel very daunting to someone who currently has a practice and is like, how am I gonna rebuild this whole law firm AI enabled? Like I hear what you're saying, and I hear what you're saying, Zach, like that you can pull AI in at all these different points in your process now, not just AI, any kind of technology and efficiency. And if you're up and running, you're very much feeling like I got to rebuild this plane and we're, you know, 30,000 feet and how, and that could feel very overwhelming and daunting.

[00:18:12] Speaker 3: Yeah.

[00:18:13] Speaker 2: And I guess I'm here to say, yes, and it probably is. And you know, what's the saying about how you eat an elephant, one bite at a time, right? Yeah. So that's what we help people do, is let's just pull back and get started. Ideally, we want to get prioritized, get started. And maybe a biggest pain point, where is something really slowing you down, a huge bottleneck, that might be an obvious place to start. But if not, that's one of the things that we help people do. because it can be very hard to do that internal reflection on like, what's going on, you know?

[00:18:53] Speaker 1: What are they, there's another- I mean, that's why we have coaches, right? Yeah. You know, that's why we have strategists, that's why we like, in sports, in life, you know?

[00:19:00] Speaker 2: There's another saying that it's really hard to read the label on the bottle when you're inside the bottle.

[00:19:05] Speaker 1: Ooh, that's a fun one. Yeah. Okay, I'm gonna try this, Stephanie. Okay. We actually have the clip here, and we're gonna go to the clip. Okay. Let's see how this goes.

[00:19:32] Speaker 2: This year I thought I'd ask you, if you were advising, starting a small firm today, you got a partner, let's just pretend you could start a firm, and so you're going to start your own two or three person firm, what would you do to make sure that your firm is still relevant and viable in five, 10, 15 years as all these technology changes are coming at us?

[00:19:55] Speaker 4: Well, in the technology world, we talk about this, this dichotomy almost between traditional software companies and AI native software companies. And with AI native companies basically being this new generation of AI companies that have been born in the last one or two years. And if I was founding a law firm, and by the way, in the software world, these AI-native companies are regarded as moving super quickly because they are leveraging AI in everything they're doing, whether it's marketing or sales or financial forecasting, reporting, it's just woven into how they're doing things. And I think this idea of being AI native is how a modern law firm should think about building their operations. I would think about how do I, how do I found this law firm from the ground up assuming that AI, everything that can be powered by AI will be powered by AI. All the way, I would audit the entire client journey. All the way from client intake. All the way to bill payment and referrals at the end of the engagement. How can that be powered by AI? How can I leverage AI every step in that process and be as much as possible an AI native law firm? And I think with that view, you will be relentless in thinking aggressively about how you can weave AI into every aspect of your practice. And I think it's got to be from the foundations up. And that is how the AI, that's how the AI powered law firm of the future is rapidly going to become, I believe, table stakes. If you're not operating in that way, you will not be competitive in this market.

[00:21:53] Speaker 1: Okay, so hopefully that worked and people watched that. Stephanie, that was part of your interview with Jack yesterday, talking about all of this stuff. And one of the things that we didn't necessarily get to that we kind of hinted at there is there's this idea that we have to do more as lawyers right now because we can, and when we do that, one of the things that people don't like to talk about is this idea that if I do four times more the work, if I do the work four times more quickly, now I have to go get four times the work in order to be able to do the same things.

[00:22:32] Speaker 2: And so we have to think about things approaching our our business setup potentially even differently and you were talking about the idea of you know consolidating law firms yeah using their powers together but like we've seen in the dental field yeah I mean as we continue to see regulations change in law and the whether they change and allow non law firm owners to own law firms or not we always we continue to see small firms merging, right? This happens a lot in the mid-size market, too, where they'll acquire a partner in their book of business or their team. That is a merger, and any time we're dealing with those kind of scenarios, you know, our team on the Affinity side, especially, gets hired to come in and fix the tech, because you kind of have two businesses coming together now, and that needs to merge. The client files have to come over, and we got to make sure now all the, for conflicts checks purposes, I mean, it is not just a nice-to-have, it is a must-to-have. You have to figure this out.

[00:23:37] Speaker 1: You know, it's funny you say that because I actually talked to Tucker, the Clio's head of draft, and also Ronnie Gurian, their COO, about both of those, about that, about this idea of combining teams and when you purchase another company, Obviously, that came up, because Clio tends to purchase companies. When you merge or you purchase another company, you do. You have to get all of that infrastructure connected.

[00:24:10] Speaker 2: Right, and so then it occurred to me, as Clio is going more upmarket and getting into a larger space, as I think we might see more consolidation of law firms, will there be a competitive advantage to firms joining up, And because they're already, if they're both Clio users, does that make that process that much easier, that merger of the technology? And I mean, I think the answer is yes.

[00:24:42] Speaker 1: I would think so.

[00:24:43] Speaker 2: And yeah, I mean, it's just something to think about as like you're pondering life.

[00:24:50] Speaker 1: Well, okay, so two things about that. One, I had a discussion with someone yesterday about how, you know, Clio always talks about you owning your own data. And they do a really good job of that. I think, when I was talking to somebody specifically, she said, it's really easy to get your data out of Clio, put it into CSVs, and kind of be able to manipulate them. And that's part of their whole ecosystem. But the second thing is, even if you're, and this is a plug for us, even if your actual technical systems do or don't merge together, you have to think about the systems that you use to run the firm, to run the company. And if you are trying to merge two systems, and one system has great KPIs or OKRs or something like that, and the other is just running with a hope and a prayer, or just, that's not going to, Like, you better freaking get on top of that right now in order to remain competitive as a potential AI-enabled law firm, really.

[00:25:58] Speaker 2: Yeah, I mean, I think there's just, these questions have always been around. Maybe just AI is just giving a new light to them and like, okay, we're thinking about our technology different. You know, the other thing, you know, lawyers come to us sometimes and they're later in, or honestly at any stage, maybe they're like, what's next, like is there, what's my exit, what's my succession plan? And we're often talking to people about, you know, what are you really selling if you sell your law firm? For most law firms, it could be a book of business, but we know that clients can go with anyone, they don't have to stay with you. And so, you know, we talk about what you would be selling is that business structure or infrastructure, your systems, your processes, you know. It just occurred to me that obviously, if you really kind of unlocked some of this stuff early and figured out AI, that could give you a value bump in the business that you have. Like there could be people who are like, hey, we want that. I don't know, this just came to me, especially like we talked yesterday about our speedboats. You know, our small firms are our speedboats. So if you're a speedboat and you've unlocked this and figured out how to leverage AI, that could be attractive to some of these bigger firms, especially who are sort of struggling with it. They're just slower, sometimes, to adopt, and that might be very attractive to them to say, hey, let's actually buy your system, because then we can leverage it and implement it for our team.

[00:27:26] Speaker 1: Yeah, that's a really good point. So, yesterday's podcast that came out was...

[00:27:31] Speaker 2: All before a cup of coffee, by the way. You're getting Stephanie brain.

[00:27:35] Speaker 1: Yes, yes, this is all before we've... I know, I have my cup here. We can give you a second to go grab some coffee. We're live, and I can just yap at people for a second. Or I can run another clip. I'll just run that clip again. But yesterday's podcast with Bernadette, we were talking about some of the KPIs that you're looking at as a stage three or stage four firm, and that's when you're starting to think about succession planning and the valuation of your firm. One of the things she was talking about, setting your firm up like that, like creating these processes, when you have good SOPs, that is a major value to your firm. That looks valuable to somebody else. But I hadn't thought about the idea of like, yes, SOPs, but also like, I mean, AI is kind of like enhanced SOPs, right? Like you better have some SOPs. But being able to make that work, showing, hey, we've been able to make, like to join our SOPs with the AI, to make this work properly, to have proper internal controls on artificial intelligence, to have vetted products already. You know, I think that's a good point, is it could make you very valuable, very quickly. Yeah. Okay, well, so we are at 29 minutes right now for this morning, so I think we'll...

[00:29:04] Speaker 2: Thanks for hanging with us, guys.

[00:29:06] Speaker 1: Yeah, we'll wrap up. Stephanie, do you have any thoughts on, oh.

[00:29:09] Speaker 2: They're done with their Peloton workout.

[00:29:10] Speaker 1: Yeah, now that everybody's done with their Peloton workout.

[00:29:12] Speaker 2: You ready for some cool down?

[00:29:13] Speaker 1: And if you're not ready for a cool down, crank it up to like 40, 45, get up out of that seat, you know, go for a climb while we're not here. So, you know, just climb for another like three minutes, let's say. Keynote today is Richard Siskin. That's gonna be interesting. So if you're out there listening, or you're Richard Siskin and you're listening to this, like, it's gonna be good. It's going to be an interesting one. He's going to be working on it. More AI. Yeah, more AI.

[00:29:39] Speaker 2: I know everyone's like excited about that, but it's the topic of the day. We need to, there's a lot to uncover and unpack with it too. I don't think, you know, I don't think it's as easy. Like, I will say, like, I don't know. I'm curious and I want to go over and talk to the Cleons today and see some more stuff because that's what we do. You know, we're trying to always learn the best for our clients. You know, at the end of Jack's keynote, it kind of looked a little still like you press a magic button and it does all these things. And I don't know if you've talked about this yet, but our experience with a lot of these tools is there's a lot of magic that happens, but there's a lot of work and planning and understanding of the tool and building the tool the right way and you can build out customized workflows and understanding your prompts. I was talking to someone yesterday, I thought I had some long prompts. He has a prompt that's 20 pages long that writes for legal documents. Wow. I know, because I think people are still like, and even the prompts like in Jack's demo were two sentences. And most of us would be like, OK, it takes a little bit more than that. And I get, like on the keynote, you're going to simplify things. But I forgot where I was going with this. But there's still a lot for us to figure out, I guess. So maybe I just want to give some encouragement to people. It does feel overwhelming. It is a lot. Change management, how you're going to train your team. we're gonna train our team to think completely differently and approach their work differently, and it's not all gonna happen overnight. But we're figuring it out, and that is why AI is such a big topic right now, and why we're gonna keep going at it from all these different angles. But we will figure this out.

[00:31:20] Speaker 1: Well, and again, as we've said, AI exacerbates or enhances, and so if you wanna make sure that it's enhancing your firm, get the basics right, and one way you can do that, The first way is to subscribe to the channel. The second way is to contact us if you want to look into coaching or getting one of our big brains that we have helping you get your firm started. All right, well, we will see you guys a little bit later on as we continue to do these things throughout the show.

[00:31:51] Speaker 2: Enjoy your morning.

[00:31:52] Speaker 1: Good morning, CleoCon.