The following is an only slightly edited transcript from our conversation with a top 100 law firm CIO. All words are our best recollection of this CIO.
Many startups see procurement as daunting. Going through procurement at big law firms used to be the wild west. Back in the day you used to get a partner signing a contract at a big law firm and you were golden. Now there’s no way a partner signing a contract means that the rest of the law firm has to use it. That’s a great way to piss off the people who can actually sign and approve your contract. So avoid the temptation to think you can force your way through procurement at any big law firm today. Procurement at a big law firm is sometimes called the innovation team. This CIO is the Chief Innovation Officer of a top 100 law firm and was generous enough to walk us through the process of procurement over the holidays for the benefit of startups trying to navigate big law.
First and foremost is security. Small companies like startups think security is too big a leap to overcome. This is a common misconception, as there are many big law firms willing to work with small startups as long as they have the right product and team to figure out how they can make it work. Industry standard security is obviously a must. Ideally your startup would have a SOC2, but sometimes it’s just fine to have your SOC2 done by the end of next year as long as you’ve say started the process to become SOC2 compliant and have certain aspects in place already even if you haven’t quite yet paid for the expensive audit to certify compliance.
Even as recently as last year a big law firm brought on a brand new tool that allowed them to explore generative AI and so by nature it was a new tool. However, the law firm decided that it was better to bring on this tool and allow access to it with guardrails rather than having their lawyers use ChatGPT without any guard rails at all. Lawyers and IT departments often look for perfection, but what procurement does is orient the conversation around the current state, rather than the ideal state.
The best advice is to focus on process not product. I think people get thrown off because they show their product to everyone at the firm and get everybody excited with their bells and whistles. Then the attorneys never reply to the startups emails again. You didn’t focus on the process of helping that attorney navigate what needs to be done to get to the next step of approval so the product can be deployed in the first place. A question you should ask as a small startup is if this is an attorney that’s even willing to go to bat for you or not? They might think it’s a cool tool but that doesn’t mean they’re actually interested in helping it get across the finish line.
At the same time focusing on process not product means it’s also a terrible idea to go straight to attorneys. Especially if you’ve already had your hand slapped once. Some vendors continually pitch to the attorneys and procurement keeps hearing about the product from these attorneys and the startup actually believes that if the attorney’s are excited procurement has to do a pilot and get them in the door. This is not true. This just frustrates procurement and helps them realized that your startup isn’t a good fit because you won’t be a partner to their law firm. The attorneys typically know procurement very well and trust their judgement so this is a bold strategy and a losing strategy.
The attorney procurement conversation in these situations likely goes something like this. I want to pilot this tool for this reason, it’s really important for that reason, how fast do you think we can get it done? Then procurement explains all the reasons why we’re not going to be piloting this tool and the attorney’s answer is always “okay”. Now you’ve lost the interest of the procurement team and the attorney you were hoping would jam it through.
It’s an extremely rare that going straight to attorney’s will somehow magically get you past procurement. It’s totally fine to get attorney feedback in the beginning but once the conversation starts with procurement you should inform them each time you’d like to talk to the attorneys and why, the procurement team will usually be open to that unless there’s really good reason not to. Procurement wants to know what they’re saying too! Procurement wants to understand what attorneys are interested in and why. Attorneys may not know that we already have a tool for that at the firm. That’s where the partnership comes into play. Make procurement your teammate instead of your enemy and you’ll have a lot easier time getting to a paid pilot. This is the number one mistake that startups make with procurement and it often results in you making an adversarial relationship with the people you need on your side because it tells procurement you are not going to be a good partner and you don’t really respect being a good partner to the firm.
Another example is a big law firm this past year worked with two companies this year that were both piloting for the first time with US law firms. Both had a number of technical issues in pilot mode, even after a year invested in building relationships with them, learning their technology, working with teams to get them deployed and jump through all the hoops, one was dropped and another was kept. It didn’t need to be that way - both could have been kept. However one of the startups was a good partner to their big law firm and the other was not. That is the only difference.
Being a tremendous partner is about acknowledging your shortcomings, communicating about what you’re working on, and being honest every step of the way. Being honest is always important but is especially huge during the sales cycle. If you’re saying your startup will be done with a feature by the end of the month, you better have that feature done by the end of the month. When a law firm you made promises to calls you by the end of the month and asks for evidence you have done those things they better be done or you’ll lose a lot of credibility quickly if you’re making lofty goals. It’s ok to say something is farther along on the roadmap but don’t commit to a date unless you can follow through. Just being honest about not knowing when you’ll have something done goes a long way. Not being able to commit to deadlines isn’t always what a firm wants to hear, but being dishonest is always going to hurt you more in the long run.
You just end up creating more stress for the attorneys and procurement if you say you’ll fix something and you don’t. If you do get a problem fixed fast you build a lot of credibility. Having problems that need to be fixed is expected but being a good partner means following through when a law firm points out a problem that needs to be fixed now. Never tell a law firm “we can’t replicate that bug so we’re gonna close the ticket”. Act like you care. Don’t ghost people during checkin calls. Don’t have the head of the company skip calls because they have something more important to do. These are not small details and they are noticed by everyone around you. This often becomes obvious very quickly in the procurement process before a deal is even made.
Being respectful and honest is a two way street. Big law firms will often be honest about if there is bandwidth to try your product or not, so you should be honest and respectful with them too. Big law firms have a million projects they want to try and there is no way anyone has bandwidth to try everything they want to. This is to the startup’s benefit too! Any startup needs to know that the law firm they engage with has enough time to give them a shot too.
There are often tools paid for by law firms when the firm has no bandwidth for pushing attorney adoption within the company. Do not take this personally! Do not try to make a big push without permission to try and drive attorney adoption behind procurement’s back. This will not end well and it’s better to be patient with your law firm and treat them like partners. When the tool breaks, who do you think they’re going to call? The IT and innovations teams, who happen to lead procurement most of the time. When there’s not sufficient support for your tool to the law firm, the attorneys are going to get upset and now your tool has a bad reputation at the firm. Being told to come back in 6 months isn’t meant to shoo away a startup, it’s meant to protect a startup and the firm from reputation damage. Not yet being able to fully support a tool that gets widely deployed can be disastrous for everyone involved.
There is a ton of work that goes into making a product successful, and sticky, and handholding attorneys to get procurement just as familiar with the tools as the vendor is so that attorneys have someone they know and trust to go to when they’re frustrated with your product to ask questions. This will avoid attorneys taking out their frustration with their product out on you. It’s much easier for procurement to tell an attorney they used your tool in a dumb way and it’s not supposed to be used like that than it will be for your team to tell them the same thing. This is good for your startup. It’s how you want things to work. Otherwise they will take their frustration out on your tool and blame you instead of blaming their own mistakes and your reputation will suffer.
When considering a company that’s early on like a startup there’s a lot that goes into giving a company a shot. References are the most important. If you can go to a big law firm honestly and tell them that you’re being used by their peers in ABC ways to get XYZ results that’s going to catch procurement’s eye. Law firms get so much cold outreach that it’s ridiculous. If you try to play the cold outreach game with law firms as an early stage startup you’re not likely to stand out. Even if procurement tried to reply to every email and consider every single product it’s just impossible. Most emails go straight into a folder to maybe search through one day if they hear your name somewhere, but maybe not if they don’t. This is reality.
Personal introductions are golden tickets. If two founders would have cold outreached a top 100 law firm there was a zero percent chance of us responding to you. Someone I personally knew introduced you. Procurement teams know a lot of people in their own industry. If you haven’t made the effort to go to just one conference for law firms and check LinkedIn for Chief Innovation Officers at big firms you wanna meet and say “oh this person knows this CIO” and reach out after meeting that conference CIO to ask for a warm intro to a CIO what makes you think this CIO will give you their time? Conferences LinkedIn, and warm intros are the basic level of effort expected of startup founders, otherwise it’s perceived as unserious.
Another way of focusing on process instead of product is to send an email offering an intro to a law firm that would be able to help the average CIO understand what they’re using your product for and why. Offering value from the beginning will signal that you’re willing to be a partner that actually cares instead of just trying to make a quick sale. An introduction may result in procurement teams talking to someone about your product but that’s also someone new that the average CIO can learn from. Procurement teams are always trying to learn from others. This can only strengthen your case.
Never tell a procurement team that you have a lot of top law firms using it but I can’t give you an introduction because the firm sees it as a competitive advantage so they don’t want to talk to you about it. This is an obvious lie. Rising tides lift all boats. People in law talk. References also help because it tells a Chief Innovation Officer that you’ve been through the process at least once before so you should be able to make it through the security process somehow.
Solving a real problem is an obvious way to get your product at least looked at. There are not many times that cold outreach works but it can work only if you’re solving exactly the problem that a law firm is having right at that moment. Often times they do skim the emails and if your email mentions solving a problem that they are experiencing right now they could possibly take a look. Do not talk about your game changing whatchamacallit or about how your platform does everything A to Z. Say one thing that you do really well and put that at the top of the email. If it’s not interesting enough by solving a firm’s real problem, there is no way they will respond. You will never convince a law firm that they have a problem that they don’t have. If you make it really easy to understand what you do and the problem you solve and you email 1000 people you’re going to find the people who have that problem. People think that if the Chief Innovation Officer doesn’t respond they didn’t read it, but they do.
Anyone can talk a big game and make yourself look bigger than you actually are like, but this is not a good idea. Founders that become Chief Innovation Officers often are horrified by how bad founders are at being honest, being upfront with a value proposition, solving a real problem, partnering with a law firm, and introducing law firms to add real value upfront. So many founders demo demo demo and don’t stop to ask a question about process vs product. If you show a demo for a few minutes and they’re excited because it solves a problem the rest of the meeting should be about the process of how something like that might get approved by their firm. This is how founders make their first sale.
Many law firms use something like a Trello board for keeping track of where startups are in the procurement process. The first step is references or intros to things a law firm is interested in considering. Then an initial meeting where companies talk about the law firm’s problems and process but usually actually wanna show the product in a demo. Sometimes this makes sense but other times this is maddening if you haven’t even had a chat yet about the problems at the law firm and the process. If it makes sense to use a product and the process conversation goes well the next step to “under consideration/references”. Nothing moves forward without references unless there are references unless the product is literally brand new. Law firms wanna know how did they get it deployed, how did they get it adopted, what worked and what didn’t. They don’t want to repeat someone else’s mistakes. References are important both from an average CIO that oversaw the deployment but also from at least one end user. And ideally more than one end user from different firms that used it. Then it goes into security review. Sometimes law firms will take a hard look at security upfront if the product is newer so that nobody’s time is wasted. Law firms won’t waste their time unless they’ve done the reference check usually. Then the next step is pilot phase. It’s hard to tell when a product goes from pilot phase to wide adoption.
Some tools don’t leave pilot phase for multiple years. This is usually for good reasons. Other times a law firm in pilot may only rollout to say one group of 20 users in one department and try it out. Then after say three months of working out the kinks they may graduate usage gradually to more and more users, then more departments, then more after that. The next step is evaluation and ROI. Big law firms have a lot of reporting tools to be able to measure ROI for a tool. Is this a tool that the firm wants to refer more broadly is always an important question. If so there need to be ROI stats that back it up. Big law firms like this global top 100 law firm have their own data warehouse so they collect a ton of statistics on the tools they use to measure things like ROI and then the firm makes recommendations to people within the firm who are decision makers. If the tool is green lit they focus on adoption. A global top 100 law firm never just drops a tool and walks away. Instead firms try to make the tool sticky and come up with processes for using the tool and make it successful. This is why law firms spend a lot of time trying to make sure they have the bandwidth to see a tool through. Ideally innovation hands it off to another department. After wide adoption and working through most of the issues it’s mostly a matter of the department innovation hands off to answering user questions, onboarding new employees to the tool, working on renewals for the product, updates, etc. Oftentimes the department handed off to at this top 100 law firm is practice technologies, research services, or whoever should be the “home” for that tool. The innovation department is never the ultimate home for a tool.