Practical Law Company is proud to be recognized in the below article as a company representing the future of law and “one of the most inventive legal-field operations in the nation.” Read more about PLC, inside. THE FUTURE OF LAW PRACTICE TOMORROW: A SneaK PreView FOR THESE FIRMS THE FUTURE IS NOW The Category Creators: Serving the Other 80 Percent BY STEVEN T. TAYLOR In 1998, Harris was an associate at New York megafirm Davis Polk & In the midst of a turbulent legal market, Wardwell when he happened to see a bill going out to a client for a mat- lawyers would be wise to heed these ter he’d worked on. The bill equaled words: “It is not the strongest of the spe- his entire annual salary—and it only covered services rendered for Janu- cies that survive, nor the most intelligent, ary and part of February. He realized then that whatever other money he but the one most responsive to change.” pulled in for the firm for the rest of the year would either be spent on over- That’s from a guy who knew a thing or two head or line the partners’ pockets. “After that I quickly became ob- about change—Charles Darwin. sessed about profit margins and, more importantly, the excessive overhead and cost in the delivery of an entirely any believe a tectonic shift information-based service,” Harris is rocking the foundation recalls. “It didn’t seem the practice Mof the legal profession and of law should require the 25-floor those firms that don’t respond to it vistas and the mahogany paneling will become extinct species. Don’t be- and the fine art on the walls and the lieve that? Consider Heller Ehrman law library that nobody went to.” or Wolf Block or Thacher Proffitt & The result of that thinking? In 2000 “Tomorrow: A Sneak Preview— Wood, or any of the other previously Harris and an entrepreneur friend, For These Firms the Future Is Now” “strong” firms that collapsed in on Alec Guettel, co-founded Axiom by Steven Taylor, published in themselves in the past two years. Law—a very different law firm with Law Practice, January/February 2010, Some just don’t see the prover- a very different business model. It’s Volume 36, No. 1. © 2010 by the American Bar Association. bial handwriting on the wall. Others based on this concept: Most commer- Reprinted with permission. do. Mark Harris is one of them. cial law firms are designed to support WWW.LAWPRACTICE.ORG January/February 2010 Law Practice 39 TOMORROW: A SNEAK PREVIEW which allows for the flexibility that some lawyers love about the firm. “When they’re not on an engage- ment, we say they’re ‘on the beach,’ and they don’t get paid,” Harris says, adding that their salary resumes when they start working again and their benefits are never interrupted. Now to some this may sound like a temporary arrangement. But when asked if he dislikes the term “temp,” Harris quickly responds. “Temp is a four-letter word for us,” he says. “Our lawyers are not temporary. And, we serve over half of the companies in the Fortune 100 in the markets we’re established in. The work we do for them is never work they entrust to a Chris Millerchip and Jeroen Plink of Practical Law Company in PLC’s New York City office. temp firm. It’s sophisticated work.” Given that it has brick-and-mortar offices, Axiom can’t exactly be cat- the most exceptional of legal matters, Management has replicated significantly egorized as a “virtual” firm either, the top 10 to 20 percent of complex smaller versions of this setup in San although Harris hears that term a work. Axiom is designed to service Francisco, London, Chicago, Los Ange- lot as well. “Axiom is engaged in the other 80 percent of that work. les, Boston and Washington, D.C., too. category creation,” he says. “We’re “We do a lot of things a conventional In New York, the firm has 20 desks trying to invent a whole new cat- law firm does but we’ve stripped out that its lawyers can use when they need egory of law firm. When you’re do- two-thirds of the cost structure of a to meet as a team. “Meeting once a ing that there is no vocabulary.” one-size-fits-all approach,” says Har- week, we can have 100 lawyers across But there are cost savings to clients, ris, who serves as Axiom’s CEO, adding those 20 desks,” Harris says, “200 if they as Axiom can provide its services at that his firm has dismantled two main meet once every two weeks. This is an sometimes half the rate of most other proponents of the traditional firm: “The interesting way to think about the fu- firms. “Our cost advantage comes physical overhead and the pyramid, se- ture. This is where we think it’s going.” from getting rid of 90 percent of the verely leveraged economic structure.” Axiom doesn’t hire new law school physical overhead,” Harris points out The stripped-out overhead comes graduates or train junior lawyers either. proudly, “and getting rid of the pyra- from the fact that, in the main, Axiom’s The minimum years of experience its mid, which typically supports the 100 lawyers don’t have traditional offices. Its hires must have is four, but most have lawyers at the top all making a couple 280 attorneys nearly all work on-site with between eight and eighteen years. More- million dollars a year. Our clients are clients or from home offices, or when over, most are refugees from happy and our lawyers are happy.” some are serving as part of a larger team some of the nation’s top firms who were on a matter, they work from hoteling ar- weary of the work-till-you- At the Intersection of rangements at Axiom’s New York head- drop demands. Partnership and Publisher quarters space. The firm has two floors of The lawyers are paid a salary with The attorneys employed by Practical a 150 year-old, no-frills warehouse build- benefits, enabling them to know what Law Company (PLC) strolled out the ing in SoHo, where a relatively small staff they’ll make annually if they’re fully front door of some very prestigious of 55 performs marketing, client service, engaged during the year. But they don’t firms to join this unique company. accounting, finance and other functions. have to be if they don’t choose to be, From Skadden Arps, Clifford Chance, NY New York, Law Company, Practical PHOTO: WWW.LAWPRACTICE.ORG January/February 2010 Law Practice 40 Sullivan & Cromwell, King & Spalding, that told us how these deals work, how teach how a transaction is typically Goodwin Proctor and beyond, the list they’re structured, why they happen, structured. Recently, I met with the of alumni firms is impressive. It’s this what the legal mechanics were, what senior partners at a top-five U.S. law sort of pedigree that lays at the founda- the tax reasoning behind it was?’” firm and they said, ‘We tend to forget, tion of what’s one of the most inventive So they decided to set up their own as senior partners, what it’s like to be legal-field operations in the nation. company and publish the needed that deer-in-the-headlights associate While “legal-field operation” is one information themselves via PLC who really doesn’t know anything.’” way to define PLC, here’s another way Magazine, which quickly became So for young lawyers doing M&A to describe the company, which sells the publication of choice for Great work, for example, access to PLC’s training products to help corporate Britain’s M&A and other finance at- practice notes on how to perform attorneys navigate the highways and torneys. “It was like a cookery book due diligence can help get them up to byways of transactional law: “We’re for lawyers,” Millerchip says. “The key speed. In a way, this service supple- a sort of hybrid between a law firm thing about the market we created was ments, or even replaces, a training and a legal publisher; it’s a unique that it was popular both with in-house session between partner and associate. model,” says Chris Millerchip who, counsel and in private practice.” “The reality is most partners don’t have with Robert Dow, left London’s Slaugh- Then, as the Internet took off the time for this sort of training, and ter & May to co-found PLC in Great in the ensuing years, PLC fully em- some partners aren’t very good at it,” Britain in 1990. The outfit opened a braced it. It now provides a range of Millerchip says. “Some people say it’s New York office in December 2008. subscription-based online resources like having a virtual lawyer working What initially set them off on such a to build lawyers’ know-how in topics with a junior attorney, teaching an asso- venture? “Robert and I would sit around that fall under the two core categories ciate how to draft a document, how to a table as a deal was being done, and of Corporate & Securities and Finance. negotiate, helping through the transac- we realized that we weren’t the only The majority of the nearly 200 lawyers tion step by step.” ones who didn’t exactly know what the company employs (most of whom Midlevel and senior attorneys find was going on,” says Millerchip, PLC’s are in London) write content for the benefits in PLC subscriptions as well.