Ed Walters: CEO, FastCase
#BakersDozen is a series of interviews with leading professionals in the fields of law, consulting, finance, tech, and more.
Tell us a bit about yourself and how you came to be in (or a customer of) the legal business?
I was a lawyer at Covington & Burling in DC and Brussels in 1999. One of our firm’s biggest clients asked me to do legal research, but not to use Westlaw or LexisNexis. I figured I’d just use their biggest competitor – but when I couldn’t find one, my office-neighbor Phil Rosenthal and I decided to build one.
What do you do for a living right now?
I’m the CEO of Fastcase, and I teach The Law of Robots at the Georgetown University Law Center and at Cornell Tech, the new law/business/tech program from Cornell in NYC.
What has been your greatest triumph and your greatest success in the legal services field and what did you learn from each?
We set out to democratize the law, and with 800,000 subscribers (many of them free through their state bar associations, or through our free mobile apps for iOS, Android, and Windows Phone), I think it’s safe to say we’ve made a permanent, structural dent the curve for access to law in America. We’ve learned a lot in that process – maybe first and foremost that content is a service business. Legal research isn’t about mere access to law – it’s about beautiful, powerful software and a pervasive ethos of service from across our team.
Do you think the legal industry is headed in the right direction, the wrong direction – or which direction?
Right direction, too slowly. I was just at a conference with Jordan Furlong who wrote this great book, Law is a Buyer’s Market: Building a Client-First Law Firm. And we spent an hour talking about why law has traditionally been a seller’s market. That’s starting to change a little bit, but very, very slowly.
Who – or what – inspires you – and why?
I’m inspired by Elon Musk – he’s not just visionary, but he’s building out everything at once – self-driving cars, advanced batteries, solar panels, private rockets, Neuralink, missions to Mars, the hyperloop, tunnels under Los Angeles. He’s pioneering them all at once! I especially admire that he’s doing these things, not just talking about them.
What advice would you give to the younger generation contemplating law as a career?
I’m pretty bullish on the practice of law right now. I think the future is bright for lawyers who are prepared to seize the opportunity. We’re on the cusp of a new age of more sophisticated practice – an age in which we can serve more people, and with a higher quality of representation. I’d recommend cross listing some classes in law school that will matter to clients – like accounting, data analysis, and software development, to name a few. New lawyers should continually educate themselves, and they should be unafraid to be bold in reinventing the profession. It’s a great time for it!
How ready for change do you think the legal industry is?
Clients are clearly ready for the change, which is why they are bringing so much business in house. When clients are ready for change, then the leadership in law is ready for the change. If they’re not ready, they’d better get ready.
Is more – or different – leadership required? In what ways?
Existing law firm leaders can make important changes, especially as younger lawyers begin to take leadership roles. Law firms are creating expert systems, hiring data scientists, starting legal tech venture funds, and structuring their data for better analysis. Law firms aren’t nimble, but they don’t necessarily need to be – the change will come slowly, but I’m confident it will come.
How deep do you think will be the inroads of technology in the industry?
Technology already touches almost every interaction of lawyers and clients. Lawyers use computers to communicate, schedule, research, assess risk, find new clients, bill, conduct discovery, arbitrate, settle – it’s hard to think of a part of the practice that *doesn’t already* rely heavily on technology. As a thought experiment, imagine how much legal work we could get done during a week-long power outage. It would be chaos – we saw this after Hurricane Katrina and Superstorm Sandy. Technology has become so pervasive that we don’t even see it anymore.
In ten years, do you see an industry much as it is – or do you see new players, new technology and an altered state?
The most important legal services firm, and the most important legal tech firm of 2027 haven’t been invented yet. Facebook and the iPhone are barely 11 years old. If you’d asked in 2007, nobody would have predicted the landscape of 2017. The best is yet to come.
Are consultants and lawyers looking increasingly similar? Should the distinction continue?
I don’t think they are – at least not yet. As a client of lawyers, I certainly wouldn’t use them interchangeably. So many lawyers I know complain about the constraints on them, but they don’t realize that there are also huge advantages, such as the attorney-client privilege. Consultants don’t have the benefit of privilege – and I think law firms should market themselves based on that advantage.
What are your thoughts on the increasing availability of data to guide client-side procurement of legal services?
I’m working on a book about this right now. I’m a data geek, and unabashedly in favor of more information about lawyers and legal services. If I want to go to a Korean barbecue restaurant, I can get all kinds of information about my options, and pick one that’s best for me (in D.C. Metro, I like Annandale’s Kogiya). But if I have bet-the-company litigation, there’s precious little that I can find out about what firm can best handle our matter. There’s no way that information asymmetry lasts much longer.
Lawyers have typically regulated to keep non-lawyer investors out but that’s a two-edged sword these days. What are your thoughts?
I have to confess that I don’t see what the big deal is on either side of this issue. In places where liberalized investment is allowed (the U.K., or Washington, DC), there isn’t appreciably more innovative delivery of legal services. Also, the largest law firms are billion-dollar corporations. They could easily fund innovation without outside investment, but for the most part, they don’t. Do we need Skadden to IPO, or to have venture investment in small firms? I know that many people smarter than I am think that outside investment is necessary – but I confess that I don’t yet see it.
What’s the one most significant factor that will drive change in your view?
It’s always markets and money that are the most significant drivers. When clients demand change, law firms will change. We’re starting to see this now – by some estimates, corporations brought $4B worth of additional work in house last year. On the other hand, that’s in a $450B market for legal services, so I don’t expect that $4B to be a big driver for change (at least not yet).
Are we seeing the demise of the “profession” and the real emergence of the “business” of law?
I don’t see the profession and the business of law being inconsistent. A profession is really just an occupation that involves formal training and qualification. Lawyers don’t need to be high priests to be professionals. And law firms have always been businesses, albeit informally managed businesses. It would be great to see lawyers learning more and using technology to become more professional, and to become better businesses. And you can see this when firms use practice management software, smarter legal research tools, or e-discovery software to spend more time practicing at the top of their degrees. The potential exists to serve clients better, to have a more fulfilling career in law, and to make more money doing it.
What do you consider is the greatest challenge facing the industry?
The greatest challenge is a disrupted, unregulated way to deliver legal advice. I don’t know what form it would take, but it would be client-focused, not focused on lawyers or regulators. The way that Netflix eliminated the friction from movie rentals, Napster and iTunes streamlined music purchases, and Uber roiled the taxi industry – there is great potential for this kind of disruption in law. All the factors are there – a lucrative services industry; a giant, unserved latent market of consumers; a product that is information-based; and providers that are heavily regulated and resistant to change. A challenge to this market would have to fight off venture backers, who would pour money into such a venture. Lawyers have the opportunity to make this change, but the opportunity won’t last forever. If we don’t build client-centered legal services that address the needs of unserved people, I guarantee that someone else will.
What do you see as the greatest opportunity for the sector looking forward?
This is the flip side of the last question: the latent market for legal services is a giant opportunity for firms that think differently about who they serve and how. If the current market for legal services in the U.S. is approximately $450 billion, and the American Bar Foundation survey is correct that 80% of people who need legal assistance don’t go to a lawyer to get it, there is a huge opportunity for growth. The addressable market for legal services is likely more than $1 trillion (with a T) in the United States alone.
But we can’t begin to address this market doing things the way we do now. I wrote an article about this recently called The Law Factory: An Industrial Revolution for Law, suggesting that many of the revolutionary innovations of that revolution would really speak to law. Using standard parts, division of labor, process improvement, and automation, could create abundant legal services for unserved clients, while creating new and better jobs for lawyers as well. A giant opportunity, ripe for the taking.
Do you think law can improve its track record on diversity and inclusion? How?
Demographics will help here. Colleges and law schools now enroll more women than men, and they are more diverse than ever. I’m frustrated that firms aren’t more diverse already, but I’m confident that change is coming. Clients are also demanding that their firms are more diverse – Microsoft’s Law Firm Diversity Program is a good example of this
Who do you think are the greatest influencers on the industry these days?
I’m really interested in the work by Dan Katz and Michael Bommarito, who have been doing pioneering work on quantitative legal prediction – at Chicago Kent and Michigan State Law, in academic writing, and in their consulting firm LexPredict. ABA President Linda Klein’s optimism and energy about the potential for lawyers is an inspiration. The team at Neota Logic is doing some great work in expert systems in law, which will be an important way to share legal advice beyond the one-lawyer-to-one-client mode of today.
There’s a lot going on right now, if you keep your eyes open to it. At Fastcase, we honor the people who influence us most every year with the Fastcase 50 award, and we’re constantly amazed by the great nominations we receive.
If you had to do it all over again, would you? Or what would you do differently?
I would do it all again. It’s easy to second guess yourself in hindsight, but I don’t think we would change much if we had the chance. I think we probably took ourselves too seriously early on – I think about how hard we were working before Fastcase really had made any traction. I suppose that’s part of the process, but I think there was potential to have more fun along the way.
If a law firm was a startup pitching for investors, would you be an investor?
If a law firm were pitching a client-centered law firm, or a firm to address access to justice at scale, or to serve the latent market, I would. Not necessarily to make money, but I’d invest to support the work.
If you weren’t doing this, what would you be doing?
I really enjoyed practicing law, so I could imagine doing that. I worked as a journalist for a while, and I think it would be fun to push hard in this new world of journalism.
What would you like to be known for?
I’d like for our whole Fastcase team to be known for knocking down walls and democratizing the law.
What would surprise everyone if they knew?
I’m kind of a centrist Democrat, but my first job out of college was as a political appointee to work in The White House Office of Presidential Speechwriting under President George H.W. Bush (the father). I was one of two Democrats politically appointed to the Administration. I got in a lot of arguments, but it was a time when you could disagree respectfully, then go drink beer together.
What’s your favorite hobby or activity outside of law?
I love coaching my son’s third-grade soccer team. The kids are 9 years old – we don’t win very much, but we always have fun.
What’s your favorite sports team?
I’m split between MLB’s Washington Nationals; LSU Football, and Georgetown Basketball.
What’s your favorite city?
I can’t do it. Washington, New York, Paris, New Orleans, San Francisco, Chicago (in the spring and summer), Brussels – I’m a citizen of the world. But D.C. is a very happy home.
What’s your favorite food?
I love making gumbo – I grew up in Louisiana, and I’m an enthusiastic cook. Gumbo is one way I tell my family how much I love them.
What’s your nickname – and why?
My family calls me Eddie, because I have my father’s name. We’re both Ed professionally, but at home, I’m Eddie, and it’s said with great joy, from the belly.