“Partnership decision making structure and the billable hour are blocking any real progress”
When did you start this company, with what vision?
A group of five of us started Radiant Law at the beginning of 2011. We were all frustrated that Big Law couldn’t, or at least wouldn’t, meet clients’ demands for better value services. Our view was that there were many better ways to support clients, but that the combination of the partnership decision making structure and the billable hour were blocking any real progress. It seemed easier to set up a new law firm than try to reform the firms we were coming from.
Our starting point was to focus on experienced lawyers offering very commercial judgement calls being charged on a fixed price basis. We also set out to create a ‘skunk works’ for law – a place where we were incentivised to actually get smarter about how to do these deals. So we immediately outsourced our junior work to an Indian LPO (now brought back in house in South Africa) and started developing proprietary technology. I joke that the vision behind Radiant was to stop being embarrassed about saying one was a lawyer at cocktail parties!
How many people are working at your company and how is it structured?
We are very focussed on commercial contracts, but we are structured around two different product lines. These product lines are:
• Supporting large outsourcing, technology and other commercial contracts (including litigation).
• Supporting high volumes of commercial contracts as a managed legal service.
Although there are common themes across both product lines (some common technology, both require judgement calls, people may work on both parts), they are also very different. The large deal team is still very similar to what we started with – better value support at predictable prices using experienced lawyers.
The managed legal services arm is very different – lots of technology process and design and supported by a combination of our teams in South Africa and the UK. We have found that the two product lines are very complementary from a sales perspective. We get given the high volume work because we are known to the client for having done their large deals; or if we do the managed legal support, then we are front of mind when large deals come along. Geographically, we are based in London, but in March we opened a support centre (insourcing the work done by our partner LPO) in Cape Town. We have about 25 staff in all, including 12 in South Africa and four software developers based all over the place (Bangladesh, Philippines, Ukraine and Romania).
What makes Radiant Law unique?
From an internal perspective, a key difference is that we are structured as a proper company, so we have divided up roles (there is a sales team for example), I am transitioning from being a practicing lawyer to a CEO and we have brought in Greg Tufnell, a very experienced fashion retailer who used to run several public listed companies, as a non-executive chair.
From the client view, I think we have created a unique offering in the market: unlike big law, we take process, technology and design extremely seriously, and unlike many of the new law providers we take the judgement calls part of lawyering extremely seriously. We are totally focussed on clients’ needs, so how we apply all those elements will vary from project to project. But by being able to bring all these elements to bear on a problem means that we can create imaginative and novel solutions that aren’t constrained by the traditional law firm drivers of being incentivised to rack up as many billable hours as possible.
If you look at the coming 3-5 years, what will be your strategy to outperform?
We are focussed on being simply better. This means working every day on getting better at operations, selling and management with an utter focus on client’s needs.
What makes you distinctive from the clients point of view?
The ways we approach creating business value in deals and the way we price deals, make us stand out for the large deals. For the managed legal services, regular law firms have been out of the market for years so we are normally being compared against the current in-house solution that supports commercial contracts. Our ability to bring technology and process to bear on the problem makes us highly distinctive to the traditional ways of supporting these contracts. We are also perceived as the “left-field” firm, so we get asked to help with all sorts of problems (such as reengineering an internal legal process at a client) that firms would not be traditionally involved in.
How do you acquire new clients?
We get a lot of referrals from existing clients and new clients are often interested in meeting us, even if only out of curiosity, given our reputation as one of the new law providers. Our focus on client needs at these meetings is fundamental to how we sell, and it is really working having a dedicated sales team.
Do you have a specific client program?
We haven’t formalised this yet, given our age and size, but we will in time.
Do you use a fixed fee-pricing scheme for all cases?
We do for all transactional work. If there are huge unknowns then we may just price stages in the deal. For managed legal services we can price on a unit price basis, but clients often prefer a fixed amount per month that is reviewed occasionally.
Did you notice a reaction from the (traditional) legal market on your new pricing strategy?
Yes – we were told it couldn’t be done, and then we did it, and now in our area clients are insisting on it and now in our area clients are insisting on it and suddenly other firms find they can offer fixed prices (although we offer certainty even where deals overrun so we are still some way ahead). A number of clients have told us that we changed the market. To us, though, fixed pricing is more a way of changing how we work and what we focus on rather than the end goal in itself. Dropping the time sheet was critical and because other firms haven’t done that, even where they fix price they still aren’t able to evolve in the same way that we are. So we are being copied on the surface, but not underneath.
Was it difficult to set prices?
It’s very easy to set prices – what is a reasonable number (given what you would expect to pay if you went to other firms and the value adds that are being delivered) that the client will be happy to pay? We track profitability by account, but I’m particularly interested in whether we are getting smarter, better and more profitable, rather than maximising short term profitability. We invest a lot in research and development and that is our priority at this stage.
How important was winning the FT Legal Pioneer Award and is it growth accelerator?
We are extremely grateful for having been given the award, and as someone who has been involved in a number of projects that have been recognised by the FT this was a great one to win for the first time (seventh time lucky!). We have also had an amazing run since receiving the prize, but it’s hard to figure out causation as opposed to correlation. Lots of things are happening at the same time, including: having now done three years of trading (we always felt that it would take three years to really get going), the economy improving and the acceleration in clients becoming more open to change. For me the biggest cause of our current high growth (we grew revenue 30% per year for the first three years, and this year we will grow over 100%) is the absolute focus and clarity that has come out of a lot of planning and work over the past 12 months.
How do you deal with ‘the human factor’ and growth?
One of our core values is the “Radiant way”: we do things in a single way that gets smarter over time and everyone is responsible for improving this way. This approach is very different from law firms, where the first skill that a trainee lawyer learns is to adapt their style to each partner.
Can you tell something about the IT importance in your organisation?
We have always considered technology to be absolutely critical to delivering more value to our
clients. Our analysis is that the legal IT market has been massively constrained by deeply conservative enterprise-supporting law firms who are not interested for obvious reasons in anything that can materially reduce the number of hours spent on a transaction (the retail market is different). This led us to develop a lot of our tools ourselves, as they aren’t available in the market. We do use off the shelf products like document automation (Contract Express) and document analysis (Diligence Engine, KM Standards and the usual high-end eDiscovery tools). But we have built our own web platform for project management and knowledge management, our own workflow platform for high volume contracts and we have extended Word with a range of tools that speed up work and improve quality. We only use cloud computing for accountancy, invoicing, document storage etc. These tools have been incredible in allowing us to quickly set up the company and evolve.
What is your thought about Legal Process Outsourcing (LPO) and Legal Service Outsourcing (LSO)?
From the very beginning we leveraged LPO for all our junior work, initially Pangea3 in India and then Exigent in South Africa. When our managed legal services offering started to really take off, we decided that the support of this area had become “core” and that we should bring it in house, which is why we launched our Cape Town service centre. So we no longer use LPO other than for spikes in volumes. Our Cape Town centre is built on all the things we learnt about process improvement from working with the LPOs. It could be argued that we are an LSO, although we tend to use the term managed legal service provider.
A trend within Dutch law firms is content marketing. Wat is your view on this topic?
I am always in trouble with our PR company for not writing enough blogs (I have a few things going on!), and they would definitely agree that content is essential from an SEO perspective and raising general awareness. In terms of specific legal articles, my sense is that the client alerts produced by most law firms tend to be very dry and they rarely stand out. In an age of abundance of content, I’m not convinced that every lawyer in the country starting each January with a new year’s resolution to write more articles is really going to help much!
My starting point, on the other hand, is that marketing is traditionally defined as having four “P’s”: product, price, placement and promotion. Lawyers always rush to promotion, but they might have more luck if they spent some time thinking about reinventing the product that they are selling.
Do you think legal services are sold thru in-depth ‘expert’ articles?
I know that there are some in-house clients that love law. But the kinds of external lawyers who are still writing dense tracts about complex legal issues and thinking that this is how to sell legal services will probably be in for a hell of a shock by the changes we see coming in the market.
Curriculum Vitae Alex Hamilton is the CEO of Radiant Law.
Before founding Radiant Law, Alex was a Partner at Latham & Watkins and co-Chair of Latham & Watkins’ global Technology Transactions Group. He started his career at Norton Rose
Alex has led six projects which have been recognised by the FT’s Innovative Lawyer Awards and was shortlisted for the FT’s 2010 Innovative Lawyer of the Year award. Alex is recognised in Chambers & Partners and Legal 500 as a ranked expert for IT and for outsourcing
England & Wales (1997)
New York (2005)
Diploma in Computer Law, University of London, 2001
LPC, College of Law, 1994
BA, Law with Philosophy, Nottingham University, 1993
Tel: +44 (0)203 433 3000
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London WC1X 8HF
(This article was published in 2015 in GrowthQuarterly/iGrowthLegal Netherlands)