Today, we’ll be talking with Zach Posner, Co-Founder and Managing Partner at The LegalTech Fund, about what this means for legal technology companies, the future of legal practice, and predictions from two experts on this topic for the next year.
The legal industry is currently reeling from what markets are calling the "SaaSpocalypse." On January 30, 2026, Anthropic released its Claude CoWork platform with open-source legal plugins. This wasn't just another product launch; it wiped nearly $285 billion off software and legal tech stocks in a single session. Heavyweights like Thomson Reuters (TR), RELX, and LegalZoom saw double-digit crashes as the market realized that the "middlemen"—companies that simply provide AI-powered contract review—might be getting disintermediated by the LLM providers themselves.
Today, we’ll be talking with Zach Posner, Co-Founder and Managing Partner at The LegalTech Fund, about what this means for legal technology companies, the future of legal practice, and predictions from two experts on this topic for the next year.
[00:00:00] Jessica: Hello and welcome to a new episode of In-House, the podcast for in-house legal professionals. This is a really interesting topic, and I know top of mind for countless in-house legal professionals today because I'm always on LinkedIn.
[00:00:20] I'm talking to so much in-house professionals and legal tech founders. But the topic of the day, as you may guess, is "the state of legal technology," and what this really means for the future of legal practice in the near term and even in the longer term. Today I have a really awesome co-host because if you have heard in prior episodes of In-House before, he is so insightful.
[00:00:47] Please, guest and listeners welcome Ken Priori, Deputy General Counsel here at DocuSign and avid LinkedIn and blog writer on all things legal, tech and AI, Hey Ken, how are you doing?
[00:01:03] Ken: I am good, Jessica. It's good to see you. Sorry. We can't, uh, be in the same city right now, though.
[00:01:07] Jessica: I know how's you are in Chicago, right? How's the weather in Chicago?
[00:01:12] Ken: Appropriately snowy and a little chilly, but as a Californian, I kind of like it.
[00:01:16] Jessica: You like it? Oh my goodness. Okay. Well, I am really happy that it's not, I'm in Seattle, as folks may know, and I'm just happy that it's not raining and I'm actually doing the show today from the DocuSign office, and I have a lovely view of the Puget Sound and Snowcap Mountains and Ferries. Um, all right.
[00:01:19] Well. Ken, for folks who are just meeting you for the first time because they haven't had the pleasure of listening to prior episodes, please tell us about what you do at DocuSign and also tell us a bit about what you write about for folks who wanna read about the great content that Ken puts out there.
[00:01:33] Ken: Yeah, no thanks Jess. I'm very fortunate to lead the product engineering IP and partner legal group. And, and we are really focused on sort of the, the building side of the house. So what DocuSign is building in terms of its capabilities around agreement management. And as you can imagine, a lot of that is focused on AI and extending this new technology, uh, deeper and deeper into our product and services. My background, uh, is in privacy and partnerships. Uh, prior to DocuSign, I was at companies, such as Atlassian and Box. , My current, uh, current take is really, uh, as I'm coming from a privacy lens is really thinking about, uh, not only AI governance and how that is reflected from a privacy rubric, but also then really thinking about what's next.
[00:02:18] I'm very, very interested in agentic workflows. In what non determinative nature, uh, that this new technology is unlocking, is going to mean for the way that we process work that we do together. And, and a lot of that gets sort of hung around the agreement process. I think it's very early days there.
[00:02:36] I think there's a lot of unknowns that we're trying to work through, both from, uh, how is this technology gonna come together, but also then how are we gonna govern the govern this, and how are we gonna make this really ha have a good sense of trust around it.
[00:02:48] Jessica: Absolutely. I actually, for folks, on LinkedIn recently, I ran a poll asking really legal professionals what would compel you to buy legal focus technology and. Can you, you hit the nail on the head that about 40% of poll of poll voters said that they really index hard on privacy, data security, and privacy, which really ties into trust.
[00:03:13] Do I trust that this AI technology is using my inputs and my data properly, securely and to only benefit me.
[00:03:22] Ken: Yeah.
[00:03:22] Yeah. And I think, and I think this is a bit, you know, it's even a bit of an evolution. I think the first step was sort of privacy and accuracy, you know, 18 months ago. And, and, uh, I don't wanna say we've, we've all gotten used to a little bit of hallucination. I don't think that same thing is gonna hold true for, for, uh, for trust.
[00:03:38] I, I don't think we're gonna be like, eh, it can be a little untrustworthy. I, I don't think we're gonna see the bar move in the same way.
[00:03:44] Jessica: Yeah. Yeah. Well, we have a very special guest today, Ken.. I cannot wait to introduce you to our guest, who is the co-founder and managing partner of The Legal Tech Fund, Zach Posner. Hi, Zach. How are you doing?
[00:04:01] Zach: I, I am, uh, thrilled to be here. It's, it's funny, as we sit here in February, hearing somebody, uh, happy to be in Chicago and somebody saying It's a beautiful day in Seattle, so.
[00:04:11] Jessica: Where are you? Where are you logging in
[00:04:13] Zach: It's, it's actually raining in 62 in South Florida right now, so I'm not, I'm not gonna complain because there's a lot of people, but, uh, it was refreshing to hear Ken say it's, it's nice to be in Chicago.
[00:04:24] Jessica: it's nice to be, and it's nice to be in Seattle where it's not raining.
[00:04:27] Zach: Yeah.
[00:04:28] Jessica: Well, Zach, for the folks listening and meeting you for the first time today, please tell us about who you are and the legal tech fund.
[00:04:36] Zach: Awesome. Thank you both for, for having me on. My name is Zach Posner and I am a co-founder and managing partner at the Legal Tech Fund. We are a early stage investor and all we do is invest in companies that transform the world of law. We, we have made over 80 investments in this vertical.
[00:04:54] Lots of folks do this. We're, we're just the only ones across the globe that are really doing this on a dedicated basis. And, and thinking about this at scale on any given day, our team is interacting with, you know, up to 50 or 60 different companies. We're meeting, you know, 50 to 200 new ones on a monthly basis.
[00:05:14] And we've been doing this for a couple years and we've been trying our best not only to help our portfolio companies, but to advance the entire community. Besides the day-to-day of running the fund, we were, we also co-founded an event called the TLTF Summit, which brings together lots of leaders to talk about all this and, and again, to accelerate the community in a very similar way that you're doing with this podcast.
[00:05:37] Jessica: Yes. Yes. And DocuSign is proud to be an investor in your fund as well.
[00:05:42] Zach: And we are thrilled and humbled to have you. Couldn't have a better friend. And, and lots of our investors are, you know, not only a source of capital to help this function, but they're also like strategic to our companies. They are here as you guys are to advance the ecosystem. And it's, uh, it's been a pretty awesome, uh, I think we're at six years right now, so.
[00:06:05] Jessica: Six years. And what inspired you to develop a fund dedicated to legal technology? So before DocuSign, Zach, you may not have known this, but I was a very early employee of a legal technology company called Lexion that was acquired by DocuSign in 2024.
[00:06:25] Six years ago, I, there wasn't a lot of excitement by venture capitalists to invest in legal technology companies, to be candid
[00:06:31] Zach: Oh yeah, there definitely. What inspired us was the ability to help companies and the ability to, to really build a community. So like, there, there were no thematic funds in this vertical and what, and, and, and we thought that people were really underestimating the potential and how impactful legal is to, uh, to each and every one of us, you know, from, forget all the corporate applications from our birth certificate to our will. Everything we do is governed by a legal doc. And if you think about that, that represents all of the truth data, the source data, and why doesn't all technology start from that lens? So I think that we basically had been in this comp, been in this field as operators had been in this field as angel investors, and just saw an opportunity to help entrepreneurs, you know, most generalist funds at the time, like they could not tell you the difference between a plaintiff law firm versus a law firm that's an AML 100 and, and we just thought that some of this industry expertise, you know, you, you put that together with capital and you can really help these companies reach their full potential and then you team up with partners like DocuSign and, and you just accelerate all of that.
[00:07:43] Jessica: The, the market has been moving so fast in 2025 and especially in 2026 it, February of 26 just started folks, and we've had some big news over the past few days with a large LLM provider releasing some legal specific plugins, which has caused a lot of noise in the market. Zach, I would love to hear first your thoughts on the market reaction to this, uh, for folks of, is it an overreaction? So for folks listening, and many of us have seen, there's a lot of LinkedIn content right now about, uh, oh, maybe I can just for 20 bucks a month build my own workflow and legal legal plugin, from a large LLM provider that can do NDA reviews and NDA triage and a few other age agentic workflows.
[00:08:33] And a lot of legal tech public stocks really plummeted double digits. So Zach, since you have been obsessing about the legal technology market for the past six plus years, what do you think about the market's reaction to this? Do you think it's an overreaction under reaction? Valid? What are your thoughts?
[00:08:53] Zach: I think the most important thing is that I stay in my lane and there's a, I've learned that there's a very different expertise being like an early stage private investor versus a public investor. That being said, if I zoom out it. It surprised me that more of this was not baked in, like, to, like the markets and how hard that these announcements hit.
[00:09:14] If you zoom even further back out, Bill Gates has a quote and we, we've never been able to find the original one, but we've seen versions of it that say people overestimate the impact of technology in the next year or two and they underestimate the impact of technology in the next 10.
[00:09:29] Jessica: Love that.
[00:09:31] Zach: if you ask me what I think about this type of announcement, it it's, it's that quote, you know what I mean?
[00:09:36] It's like there's a long distance between today and individual, you know, practitioners or even the largest legal spenders saying, we're gonna spend 20 bucks in and call it and, and build a license and, and, and, and go do this. I think that this theme is part of a much bigger one that we've been exp look, all this started in November, November 30th, 22, and that, that was the day we all saw that ChatGPT demo, you know, you saw the tech you watched, even though my, I, I can't even imagine what the accuracy was back then, 20%.
[00:10:11] But you watched the text magically populate on the screen and it took your breath away and you said, oh my God.
[00:10:17] Jessica: Yeah.
[00:10:18] Zach: And, ever since then, we've seen a lot and we've been forming Thesises. But you know, the bigger thesis is that we think about a lot are, Hey, does this stuff get won at this super high level, the model level?
[00:10:31] Does this stuff get won at like the Microsoft Word level? Does this stuff get won at the um, system of record? Legal, it, it, what about these AI associates, the Harvey's of the world, the Leges of the world. And then what about the, like, practice specific tools that are coming out? The further down you go on that spectrum, you know, right now what we're seeing is a much higher degree of accuracy.
[00:10:57] So if you go all the way down into a practice tool and say all that we're gonna do is, um, automate one specific thing, commercial real estate leases, and we're just gonna scan the lease and try to put it into a database just for commercial real estate. We see like amazing accuracy levels where I, I would say you're at a stage where you can almost start thinking about relying on this at scale.
[00:11:21] And those are areas where like, because the user experience is so tailored to that commercial real estate use end user, they see it. They see the terms that are local to 'em. They see the fields and they buy it and, and they kind of progress as companies. And we're seeing companies with amazing traction. And then you can go like all the way upstream and just say, you know, a lot of this stuff that we think about as legal tech, if Microsoft chose. To focus on this stuff through Microsoft Word, there wouldn't be like multi, multi-billion dollar businesses that have been built.
[00:11:55] Jessica: No.
[00:11:56] Zach: So I think that those are the types of things we're thinking about and I think that as you go upstream from practice to model, you probably go from some sort of accuracy rate that looks like 98% to 50%,
[00:12:09] Jessica: Yeah.
[00:12:09] Zach: And you can pick your jumping off point at any stage there.
[00:12:13] The stuff that probably most of the people listening, uh, to this podcast are thinking about it. It's important stuff and you can't be 50% of the way there. So, big question is how good does the tech get? You know, Moore's Law historically is directionally something that says every two years that the, the power of the tech doubles and the cost halves. Right now, I will tell you, I think we're in a cycle that with LLMs it's more like seven months. It's doubling. You're seeing things happen faster than you have in the past. All that being said, I think that for the people listening to this podcast, the people that are working at law firms, I think we're, there's a distance between now and them being able to rely on some of these super high level models.
[00:12:57] Now that being said, I think there's a whole nother world that's, you know, we can talk about this now, we can talk about this later about like the, the underserved community in the legal space. I think that, yes, 50% is a lot better than nothing.
[00:13:11] Jessica: Hmm.
[00:13:11] Zach: And they should be using this all day, but that, that represents, you know, new opportunities.
[00:13:17] I, I don't think that has as much of a near term impact on, you know, relics and LexiNexis and all these stocks that got hit in the last couple days as one may think.
[00:13:28] Ken: Zach, a lot of what you said resonated. Uh, maybe it's 'cause I'm in lovely Chicago, but I, I kind of think of it as like a, an iceberg that this reaction from the market sort of was a realization that the technology that is out today that is starting to evolve today.
[00:13:45] Is really sort of melting into the space and chipping away at the edges. And there's capabilities available now for $20 that were unthinkable six months ago, three months ago even. I do think that this idea of, or, or kind of looking at what the precision and accuracy is, is really important because probably what we'll start to see in my opinion, is, the ability to bring the lawyer in the loop into more, into the use of these tools starts to sort of bridge that difference between where it works in 98% and where it works in 50%. And some point below that, it's just not efficient anymore because it's like, well, if I'm rewriting most of it, where's the efficiency gain?
[00:14:22] But there's a lot of space in between there. And I think as. Workflows as we're getting more used to having engagement with these tools in a way that isn't one shot and done and the perfect document comes out, but we're able to sort of nudge it and guide it with less and less intent. In other words, it's getting closer and closer to just doing a couple of iterations and getting something that's good enough and, and absolutely there's gonna be moments where good enough has to be a hundred percent, but there's a lot of workflow that.
[00:14:50] Yeah, that clause is, that got the essence of what I need. I can, I can take that and I can move on to something next. The tooling is closer to being, doing is closer to that now than I think it's ever been before. So I think we're just gonna see an acceleration of, uh, a community of, of capabilities here where it's gonna be a little bit of a a point tool, a little bit of a model.
[00:15:10] A custom workflow and all of that creates something net new. And, and where, where that comes from your perspective of which company invests in which piece? I think it's gonna be really interesting because in some ways maybe investment, I'm gonna make proposition here. And investment thesis six or nine months ago has changed today because of how the models are changing and predicting what that investment thesis will look like in a few months is gonna be really difficult.
[00:15:33] Jessica: Hmm.
[00:15:34] Zach: I will also say that some of the things that I mentioned are like the, the construct of amazing user experiences. Like there, there, there are things that. You know, almost are more important than the technology because the user experience, like, like we're, um, we've seen an influx of investment into this vertical.
[00:15:57] So like bifurcating, which companies are really doing things and, um, anyway, we can get into all that stuff later. But, but yeah, that, that's my, my take, uh, is that it's been the same, like you have these different levels of the stack, yes. Listeners here, no, there's, there's budget sensitivities in and around legal, but never heard anybody say, we gotta cut this to $20 a month, our whole legal department.
[00:16:19] The, I I think it's more important to get the legal stuff right than it for a legal department than it is to, you know, get every nickel out of this thing at this stage. But I do think that we're just Jessica to, to your first, to the first question. I think there's just a little bit longer of a timeframe.
[00:16:35] I, I was surprised to see how drastic the public markets reacted to some of this stuff, and it also made me kind of happy that I'm not a public markets investor.
[00:16:46] Jessica: Look, I, I agree with you, with you both, and I agree with you, Zach, that I actually, my opinion was it is an overreaction. I used to work at Microsoft for four years supporting office products. And it was always confounding to me that these bigger companies choose not to dedicate building a legal specific workflow or use case or apps within their own products that are already being used by attorneys.
[00:17:12] For example, I lived in, I lived in Outlook email and Microsoft Word for most of my legal career and while I was at Microsoft, and you are right, you, I like what you said earlier. If Microsoft chose as an example to dedicate resources to building out legal apps or use cases, there wouldn't be in existence billion dollar companies. This, this applies to even Net Docs and I iManage if they chose to make Uplevel SharePoint. So with that example though, my question to you, Zach, though, do you think it is a high risk that these general LLM providers are gonna. Not like Microsoft, not choose, dedicate resources to specialized verticals because there's just too many, you know, they don't wanna spread too broad of a surface area for their engineering resources and AI resources.
[00:17:57] Zach: You're going to like much bigger theoretical questions where it's almost like do No, no, no, but like, does, does vertical software exist in the future? Like that? That's really what the, the, the type of question from my end. it does for a long time. Um, it's all about user experiences and. The, you can't configure a user experience in something that's horizontal
[00:18:24] Jessica: Hmm.
[00:18:25] Zach: One of the first companies we were involved with was a company called Omni, and they structured data from stock purchase agreements, specifically for venture capital funds. And then it was all search of in a database and, and the words.
[00:18:37] There are specific things in venture capital funds that aren't as relevant in other areas. There's types of securities.
[00:18:43] Jessica: Correct.
[00:18:44] Zach: So when you talk about a participating preferred security, that's security. When you get into private equity, there's usually one security and venture company. You may have 15 different securities.
[00:18:55] So when I'm the end buyer of this software and I open up the platform and I see words that are familiar to me, I'm like, I feel at home here. This is talking to me, this is talking to my job, helping me do my job more effectively, more efficiently. So I buy that software. You know, now if that's just generic or if I have to configure that or build that myself, that if we're a small shop, we can't do that.
[00:19:22] So, so I don't know. I, I believe vertical software exists for a reason and I think that it provides extraordinary amount of value and I think that. I also, by the way, don't think that Microsoft is necessarily dumb for ignoring the legal market, right? They're like, the markets that they think about are 50 times bigger, a hundred times bigger than legal.
[00:19:43] So I, I think that there's reasons that all that, the world has played out as it has, and I think that you're gonna see some of these trends, like, you know, you talk about the, the underserved community for legal. Yeah. There's a lot of stuff that can be done through this. Or new models, new ways for legal.
[00:20:01] I wonder like every time if you're looking to rent an apartment in Zillow, like in Seattle, like at the end of it, why doesn't, isn't there a button that says, do you want to pay $10 and have us review your lease for you? You know what I mean? And put that through some and team up with some, like, that makes a lot of sense for me.
[00:20:18] But that's like additive to this world. So I think, I think there's lots of opportunities for everything. I just think that vertical software. So long as we believe there's gonna be legal departments in corporations, and we believe there's gonna be law firms and things along those lines. There are nuances as to how these businesses are run that are important to be reflective in the software.
[00:20:37] And it's self-serving, right? I guess I'd be outta business if there's no such thing as a,
[00:20:43] Ken: yeah, and I think, I mean, I think you also may see two different models come, come around, which is, there may be the model. That is built on partnership and collaboration where, where some of the frontier models may have a very open stance and allows a lot of citizen builders to plug into them to create the tools that they need individually for their in-house departments, but then still have the right enterprise and trust.
[00:21:09] Backend so that the data is being handled correctly. And then you may have other providers who take more of a walled approach, Google kind of looking at you and who, who may just say like, no, we're, we're not gonna quite open up our APIs that way. 'cause we're gonna try to continue to build that. And, and I do think that, uh, Zach, your point's really well taken.
[00:21:27] As big as this market is on a certain scaling level it's still small for some of these players, but I still doesn't mean that, still doesn't mean there isn't gonna be this opportunity for one of these frontier models to say like, yeah, we're still gonna take that bet and we're still gonna build this, uh, tailored set of tooling that's in our enterprise stack.
[00:21:47] That that would be problematic for, uh, some of these billion dollar, uh, companies that are moving into this space.
[00:21:53] Jessica: Zach, I know that you mentioned earlier in our earlier conversations that you speak with maybe 60 plus legal technology startups a week, a month. I don't know a lot, uh, a lot. And then I, I keep up with the legal tech hub map of all the various new legal tech hubs and they are so many new legal technology startups right now. I, I guess for our listeners who are primarily in-house counsel, Zach, what advice would you give to our listeners on how do you cut through all the noise and focus on which tech maybe actually worthwhile to take a look at and demo? And then the second part of the question is if you are a legal tech founder.
[00:22:38] Where do you, like, what advice do you give them to actually help cut through that noise and focus? They kind of go hand in hand really, Zach.
[00:22:46] Zach: First and foremost, I suggest that everybody universally goes to legal tech.com. And I read all our stuff. We put out lots of stuff about this, about if you're curious about this stuff, we put out articles on why we invested and we try to break these constructs down as to what the future world we think looks like, how the companies intersecting.
[00:23:04] We put out market maps and verticals, but to go back to the, the core question is simpler. Ignore the noise. If you're a practitioner and you're debating what to do, like try to focus on the problems that you're trying to solve and work that way.
[00:23:21] Jessica: Hmm.
[00:23:22] Zach: Like it doesn't matter what your, your colleagues are software, they're invest, they're using or investing in, it doesn't matter who invited you an event or who's coming into your inbox.
[00:23:32] I think it's all about the specific pain points that you're trying to solve.
[00:23:35] Jessica: Okay.
[00:23:36] Zach: I would suggest, I think that like implementing technology is not as easy as it should be. You know, both, uh, I guess physically and also culturally.
[00:23:46] Jessica: Yeah.
[00:23:47] Zach: and a lot of this stuff is gonna be hard and it's all equal. So I would suggest if you're going the thing, you focus on the areas that will move the needle for you first, because it's just as hard to.
[00:24:02] Implement the same technology in different places, but like if something doesn't matter and you're gonna spend all your bandwidth trying to fix this thing, but that's not gonna move the needle on your business. Like it's the wrong way to, or, or, I think a lot more about this in like practice areas for law firms.
[00:24:18] Like what are, like, this is my counsel to chairs of law firms is what are the practice areas that move the needle? Because, and where your profit comes from 'cause and the ones you really care about providing great client experience for. Because that's the stuff I would focus on,
[00:24:35] Jessica: Yeah.
[00:24:36] Zach: You know, because the worst thing you can do is focus on an area that you don't care about for some reason and you transform that whole area.
[00:24:43] But it just doesn't matter because it's the same lift to do it in either one. So I would really start with like an introspective, what, what are the things that are gonna move the needle? And then I would start by going out and trying to find the right. The right tools. And I think that when you know what you're looking for, that, that happens pretty easy.
[00:25:00] I know there's a lot of noise, but it would still come down to, Hey, there's five or 10 tech tools. You know, there's services you mentioned legal tech hub that compares these things. There, there's a lot of places that you can kind of compare things once you know you're looking for, but I wouldn't start it be like, Hey, we wanna do tech.
[00:25:14] I'd start it like, I am trying to solve for commercial to manage our commercial real estate leases. Period and then go that way.
[00:25:24] Jessica: Yes, definitely work backwards from the problem. That makes complete sense, Zach, but I'm also still finding that even when I have the problem identified and the solutions, there's still at least five plus available solutions for that problem. So it's still hard. I told you earlier, Ken and Zach, I'm an avid Costco shopper. I know. I'm so Washingtonian. What I love about Costco, not not just pre record, the, the great pricing in bulk is that. The selection, I know that it's gonna be pretty good.
[00:25:55] The one or two options that I have for my egg or for my milk or cheese, and I'm, and I, I'm a Kirk signature gal too. I know it's gonna be decent quality. How do any for buyers or listeners here. Let's say identify the problem for a lot of folks, it's commercial contracting in the B2B space or even B2C, right?
[00:26:15] In terms of the buy side procurement side, how do I narrow down on just picking two or three co contract redlining tools? I'm not, and I'm a lawyer and I'm not gonna start, uh, coding my, I'm not gonna use the cloud plugins and make my own workflows like a bunch of those influencers on LinkedIn. I'm pretty simplistic.
[00:26:34] I just want something out of the box. Easy to use and plugs into my word. I think there's like 50 options when I last looked on the interweb of most options, but I only wanna look at two or three.
[00:26:46] Zach: You only need to look at one. It's called spell book and it's 'cause it's in our portfolio, but like. But if you, but if you insist, um, no, I, I don't know. Look, you, then you just have to turn to these signals. You have to turn to these things that we describe, you know, you have to turn to, what are people saying?
[00:27:03] Legal tech hub. What are your peers using? What are, who's getting, you know, unfortunately, sometimes receiving venture capital funding is a sign that, like, it's a different level of diligence. Those, there's capital providers
[00:27:16] Jessica: Okay.
[00:27:16] Zach: That. There's, um. I don't have a great answer, and I'm going to, I've never really thought through this and I, and I know how much confusion there is because I know how many companies we've funded that probably send you emails every day. The more demos you see, the better. I, I also think that this whole thing comes down to like a culture and are you opening, are you curious about this stuff personally? Are you curious about learning about this stuff? Are you looking at the generic tools?
[00:27:41] Are you playing with this stuff in your personal life?
[00:27:44] Jessica: Mm-hmm.
[00:27:44] Zach: Because I think that that's gonna be the most important skill set to take forward into this new world. Like if I was talking to somebody going, coming outta law school, or even when we're talking about people, uh, when we're talking about people, how they hire in this world.
[00:27:58] It's almost like that culture, that curiosity becomes like really important. So I, I would say there's no, you know, taking a demo is not the end of the world in any capacity, and I try to see as much as you can.
[00:28:08] Jessica: Okay.
[00:28:09] Ken: Yeah. And, and Jessica, maybe from a in-house lens, what I can think of what I was thinking about as Zach was answering is it's, it kind of comes in this three. Three bucket. Analysis, which is, goes back to what Zach said, which is what's the problems you're solving? Are you trying to create efficiency or are you trying to create insights that'll kind of do a sorting of some of the tools.
[00:28:28] I think, Zach, you said something else really important there, which is how hard is this gonna be to integrate? Right? Because so many, so many tools die in the integration phase, and so like having some curiosity. Before you make that commitment on what that actually is gonna look like and bringing in the right internal folks to understand how much customization, if any, is gonna be needed.
[00:28:47] And then the third piece, Zach also calls back to something you said that I think is really, really key, which is when you stare at it. Do you know what to do and is it intuitive? And is the UX and UI something that, that someone who only has a short period of time to put this into their day is going to want to engage in and work and, and work with.
[00:29:08] And that is really, really difficult. Especially when you have a lot of tools that are bringing in high context, uh, data points from lots of different spaces. Sometimes I, I've, look, I've seen some solutions that I look at it and say like. Intuitively, I don't know where to go, and I just think of my own team members and, and, and myself and my own team members and like, and this is not gonna have a high engagement.
[00:29:28] So if you kind of think of it, that's how I think of it in those three buckets. And that sometimes does a sorting of the myriad of options that are out there.
[00:29:36] Zach: Yeah, because it's not just about you using it, it's about everybody else has gotta get on. But we, we think that user, we think that anybody that we think of as a big company or an incumbent. Their advantageous thing is they, they can layer a lot of this stuff on. They have advantageous data that can lead to better lc that can lead to better results and better presentation of things.
[00:29:59] But like the advantageous thing the startup has is a user experience. And their user experience doesn't have to be like, it does can, to your point, it has to be so intuitive. Like when people see that it feels good and you just move forward and you wanna try that. So like I, that's, that's how we think of it as like that user experience has to be so, so, so good.
[00:30:21] Like one step function better than what's out there is not good. It has to be like multiple functions.
[00:30:27] Jessica: I always, when I talk to founders and I, and I get demos of the tech, I, I always say is this, it has to be better than the status quo and ideally I should be able to be able to use a feature without having to ask for help or support or even reading any tech support docs. That's when, you know, you've just chef's kiss and built a really great product.
[00:30:46] So talk about building product, zach. What are the legal technology? Type of legal technology companies. I really excite you and the legal tech fund right now.
[00:30:56] Any like verticals, you talked about commercial leases and maybe you're really pumped about commercial leases
[00:31:01] Zach: no, no, no, no. We're, um, we're like, when you think about like workflows, like we are pretty impressed with what we are seeing. Where we, you know, you can basically say, what would the steps have been? Like this is some of this agentic stuff. And you say, here's the 40 steps that a human would've done, and here's how we can demonstrate this being automated in some capacity.
[00:31:31] We have a company we were with this morning. They help with some tax compliance. And to be compliant with these tax regulations, you have to, um, you have to have the majority of your employees in the us. So like it automatically goes to LinkedIn and it looks where all the employees are.
[00:31:47] It pulls them in and says, most from the US check, you have to be a certain type, you have to be a C corp. It goes to every Secretary of State looks at your filing, verifies your sequel. So like there's a hundred tests that it can do before a human even looks at something. So it can get you, it can get an attorney 90% of the way there, and then it's just kind of like checking and reviewing opposed to spending hours trying to go back to each one of the, so we are just seeing some of this, like automation at a lower level and like the stuff can just work in a, in the background.
[00:32:24] So if we have a portfolio of a hundred companies, like every day this software can just wake up and run this on a hundred companies or, or we're looking at some stuff. Um, in and around some forensic accounting for litigation and historically, you, you test a certain number of transactions and you know, you pick 20 to go, but why not just run every transaction through it?
[00:32:48] Why not? So we're just seeing like a different, it's almost like there's infinite human capital at the lowest level that can just be deployed in perpetuity for di minimis cost. So it just kind of like we, I, I get really excited about the potential of, of, of some of that, if that, you know, if that makes sense.
[00:33:10] Jessica: Did anything excite you? Ken? I know you've been looking at a lot of technology, legal technology companies as well.
[00:33:17] Ken: I think what Zach said where my mind went to was the governance side for a second, and where, where I think it's really interesting when you have these non, where, where you have these workflows that are running autonomously in the background. They can be determinative, they can be non determinative, they can sort of have a workspace that are allowed to play.
[00:33:31] I'm really keeping my eye out for an organization and, and for a solution that's really. Nailed the, the, the ability to sort of have the right check-ins and have that dynamic, that check-in be dynamic. Because as more insights are driven, you're gonna wanna bring the, the professional, the lawyer in the loop in more to say like, Hey, is this, is this, has this run correctly?
[00:33:50] Do you wanna make sure, does this dial need to be changed or set? 'cause I do think, I think early in we early days where there complexity there, that doesn't change. But I think as you have these workflows become more and more complex. Landing. That ability to make sure you have the right oversight and insight, um, is, is a space that, uh, I'm curious to see what future.
[00:34:11] Future tool and how they're going to solve that. More broadly to your question, Jessica, I think this context, bringing in context across organizations into, into the workflows that are existing in ways that we haven't quite seen yet is probably, and, and there's a lot of, there's a, a number of companies who are coming up in this space who are, who are, are looking to solve this.
[00:34:31] I think there's something there. I think it's, uh, having that contextual information around. Whatever you're doing with an agreement, is really, really important.
[00:34:39] Jessica: Yeah, ken, I, I agree that is an area that's exciting to me as a in-house attorney too, because we're not just practitioners who just red line contracts. Having the full business context like metadata from a CRM, slack, uh, et cetera, really makes us a better contract negotiator, deal maker, drafter, and 'cause we're really more business advisors than.
[00:35:01] Very different role, Zach, than if we were at a, a law firm.
[00:35:04] Zach: Maybe it's almost like just getting the workflows to a whole nother level and, and not to. Like even DocuSign, you guys added something recently in a, in the signature product that basically says, summarize the document.
[00:35:19] Jessica: Yeah.
[00:35:19] Zach: Like, I, I have found my, like prior to this, I'm downloading the document.
[00:35:25] I may be dropping it into a tool myself to summarize, but it's like, think about how, how that like user experience has just gotten better and better and better.
[00:35:34] Jessica: Yeah.
[00:35:35] Zach: it's just like, it, it's fast. I, I, I think we're just sitting in like a fascinating, uh, time and it's just like that the user experience for users at all levels is just gonna get so much better that it's gonna be amazing.
[00:35:49] Jessica: No, I do love those new features of the auto tagging too, and I, I no longer have to manually drag and drop. Signature and, and name. That's also been a game changer in the e-sign user experience. Well, Ken, speaking of the future, and Zach, I would talk. What are your thoughts on like the future of legal practices of, of for first initially for in-house counsel with the influx of all these tools and we're seeing actual growth in adoption quite rapidly for the, in, in-house legal professional and gradually for the, for the law firm professional.
[00:36:26] Ken, I'll kick it off with you since you are my in-house legal peer, where do you see the, our practice, how evolving over the next several years?
[00:36:34] Ken: I think a real, a realistic best case is, agents are a thing. Uh, agen workflows and autonomous processes are a thing, and I, I do think we will have, um, tooling that allows us to, uh, think about processes that we have, spin them up, have them run automatically, maybe run sometimes just for one particular, uh, point in time or.
[00:36:57] Particular solution, but we're gonna be managing those processes and adding our insights and checking in and, and, and massaging them and sort of changing the, the dials on them to, to allow them to work. And we're just gonna be able to be across more because we're going to be able to offload some of the cognitive processing to some of these, uh, to these workflows and these processes.
[00:37:19] I'm hoping that that means that, um, we'll be able to really then really focus on the strategic pieces in, in a way that, uh, will be freed by, from some of these, uh, these sort of, uh, more rote processes. I think that's, that's sort of a realistic best case. I'll have not only colleagues, but an army of agents perhaps.
[00:37:43] Zach: From my end, like roles change. Two things. Two things that I think about. One, even the advent of like the word processor, Microsoft Word. If you look at like an agreement, you know, where 25 years ago or 30 years ago, it may have had to been FedEx back and forth each draft. There was a lot less drafts, but Microsoft Word didn't necessarily put lawyers outta business.
[00:38:07] It probably just made better contracts at the end of the
[00:38:10] Jessica: Mm-hmm.
[00:38:11] Zach: And then I think of the advent of ATM machines I used, I I, I think about this a lot. And, um, you know, late sixties or early seventies, the a m machine was invented and the headline of every paper was, this is the death of every bank branch. What happened from literally then until almost today is I, I, I think you're up 10, 15 x like something insane, the number of bank branches. Now you may have less bank tellers at each branch, you know, and there may be more loan officers and there may be more. So I'm hoping that like the, the level of work continuously moves upstream, and maybe this means that.
[00:38:49] For everybody listening here, you're more of a business partner and more than, than, than you are necessarily reviewing infinite agreements. Um, you know, but I, somebody had a quote that, uh, recently it said, yeah, like, I think this stuff's gonna be amazing at summarizing an agreement, but should I sign it? And like, that's a whole nother level of questioning and counsel that people can provide. So I, I think that roles will change. Um, but by no means do I think this is the end. I, I, I, I think there's just, it's just gonna be a different role in, in 10 or 15 years.
[00:39:25] Jessica: Agreed, and, and actually now I can't remember the last time I went to an ATM machine. On that note, I do all my deposits now with my, my mobile apps.
[00:39:33] Zach: I, I use that example somewhere else of like, like I had to kick off our summit this year. We had, you know, we had 800 hundred people flying in from across the globe, and I'm like. Who here used cash in the last like 24 hours, and I don't think there was, maybe there was two hands that raised and it just shows you how that.
[00:39:52] Jessica: yes, yes. The world is changing. And you know what? There's still folks who work at banks and, and banks. It still exist. Well, uh, Zach, this is probably your first time listening or being involved with the in-House podcast, but we'd like to wrap with a very fun segment called. Keep or redline. So as you, as you may know, um, a few months ago, DocuSign acquired, uh, in my biased opinion, the vast contracts community called Contract Nerds.
[00:40:22] So in true contract nerds, fashion, we like to have fun segment. So when we say redline, we're like, you know, basically eliminate from a
[00:40:28] Zach: Yep. I, I, I get the, I get that.
[00:40:30] Jessica: Okay. You on?
[00:40:31] Zach: Where you're going.
[00:40:32] Jessica: Okay. You're a contract nerd. I love it. All right, so the question I have for you is, "keep or red line the billable hour."
[00:40:40] Zach: If I was a, uh, if I was launching my own firm right now, I'd be redlining as quickly as you can humanly imagine and putting some technology behind and just,
[00:40:52] Jessica: Interesting. Yes.
[00:40:53] Zach: There's an entrepreneurial world for the next decade where there's gonna be some law firms that can figure that out, how to use technology, how to use human capital, and, and do some special stuff.
[00:41:02] Jessica: I am seeing that actually a lot of small firms pop boutique firms pop up that are AI enabled.
[00:41:08] Zach: Yep.
[00:41:09] Jessica: Ken, what do you think?
[00:41:10] Ken: Oh, red line. I mean, as a, as a, as a, as a purchaser of legal services, so much of the conversation moves to flat rate and, and project-based versus hourly. Because it just, I need, I need predictability in my budget. And it just feels like it's a better way to get to the outcomes. And Zach, I agree with you.
[00:41:28] I think it's an interstitial step to something else. I dunno what the, the, the else is, but it's not gonna be the hourly rate.
[00:41:35] Jessica: All right. Well, Zach, it was such a pleasure to have you on the show and get your insights given your expertise and your, your deep involvement in the legal tech space. It was fun. Did you have fun?
[00:41:48] Zach: I had a blast. Would love to come back and do this again. This is, uh, this is an audience we need to get in front of more because, you know, you guys are, uh, the world centers around corporate council and we have a whole thesis as to how that this is the role that. You know, the biggest threat to the law firms as uh, Richard Suskin said is, you know, corporate counsel using technology in a meaningful way.
[00:42:14] Jessica: I, I totally. I think we will be, we as, and our people here and listeners, the in-house council, really be driving the adoption and the pressure for our outside
[00:42:23] Zach: Drive that You drive. Yeah. Like the, the people listening here are the ones that will dictate the future of this stuff, whether, uh.
[00:42:30] Jessica: Mm-hmm.
[00:42:30] Zach: Whether you all realize it or not. So I'm thrilled to be here, humbled to be here and would love to come back and, uh, if we can be helpful in any way, please let us know.
[00:42:38] Jessica: Of course we'd love to have you back and again, remind us where can folks learn more about legal technology?
[00:42:42] Zach: Legal tech.com.
[00:42:45] Jessica: Ah,
[00:42:46] Zach: uh, or, or linked. I'm on LinkedIn a lot, all that stuff. Just find us anywhere.
[00:42:50] Jessica: alright. Great to have you.
[00:42:51] Zach: Thank you.
[00:42:52] Ken: That was great. What a great per, like what a great perspective. I mean, I don't often think about sort of someone with a, a sole investment thesis of sort of legal tech and, um, and what a moment, right? Not only in terms of what's happening this.
[00:43:06] This week in the news, but just generally there, there's so many entrants. There's, the technology is changing the way that we work as lawyers and legal professionals so much, how much of it's hype and how much of his real, I know there's enough real there that, uh, that we should be paying attention.
[00:43:24] Jessica: Yeah, I do think in the next two to three years adoption by in-house legal professionals of AI enabled technology to do our work. We'll be quite high and we are gonna outpace our friends at law firms. And then eventually they're gonna have to catch up too. So I do think we're gonna be, we are people here and listeners.
[00:43:44] We're gonna be the, the trailblazers, the pioneers in using legal technology. And then it'll trickle, there will be a trickle effect, which hopefully will, uh, impact the billable hour model as well as there's competition from smaller law firms. Client pressure to. See some difference in their bill.
[00:44:04] So yeah, I'm really exci. I think what a time to be alive if you're a legal professional, because so much investment right now and so much innovative companies are building great legal technology that frankly, they weren't as good in the past decade and, and, and because the technology wasn't there again, right.
[00:44:24] Ken: Yeah, the technology wasn't there. And I think, I think it's also gonna be this pace of iteration where, you may have a certain tech stack this month and, and there's going to be a need to reexamine that. And so even for the in-house counsel, uh, you know, uh, listening to us even if you make a decision today.
[00:44:41] You know, certainly we want some stability. You, you want to have workflows and processes, but keep on looking to see what's on the horizon because the technology is changing that quickly and think about how do you keep flexibility to keep on iterating with the technology itself.
[00:44:55] Jessica: Yeah. And the last thing I note, is that a key differentiator that I heard from both you and Zach, is not gonna be necessarily the quality of the AI model, but really it's going to be about the user experience and user experience is a pretty broad. Term, it could mean the design and user interface and the usability, the simplicity, the ease of implementation, which would then both then lead to greater actual adoption of the technology.
[00:45:30] So there is a world for very vertical, specialized legal technology that has that wonderful, elegant designs tailored. Two, the legal use case, whether it be commercial leases, commercial contracting for organizations, litigation. Do you agree, Ken?
[00:45:48] Ken: Yeah, I do. I do. I think it's gonna come down to that alchemy or that mixture of. What do you have today? What are you trying to accomplish? Right? Is it efficiency? Is it insight? Um, do to look at the tools that you have today and say, alright, every, you know, many companies have added ai. Is that solving that first case? For the new tools, bringing in, like how hard is the implementation going to be? And, and, and really, I don't think you can over overstate when I look at this, do I know what to do as a next step? I think of the implementations in various legal tech tools, I've, I've been across so many, uh, through the years and often it is, you know, thinking about like, folks only have a short window of time to interact with this technology before it feels burdensome.
[00:46:30] And I think that's, uh, I think that's what we heard from Zach. 'cause you can't overstate that, that moment to joy for folks to feel joy with the tool that they're using.
[00:46:39] Jessica: Well, it was great to see you, Ken, and I can't wait to listen back to this episode in six months and then 12 months.
[00:46:45] Ken: Exactly.