Lisa
This is Lisa Calhoun, founding general partner at Valor Ventures and your host today on the Atlanta Startup Podcast. I am really excited to welcome a local founder Lucy Lu of aiLegal. Lucy, I’m glad you can be with us today.
Lucy Lu
Nice to meet you as well, Lisa.
Lisa
So you are the kind of woman that was working so hard you were falling asleep in your Georgia Tech. And starting a business and practicing law in, you were just telling me where you’re licensed to practice again. It’s a very impressive list of states.
Lucy Lu
Yeah, thank you so much, Lisa. I’m just very happy to become more connected to the local Atlanta community as well. Like I mentioned, personally I’m a lawyer. I founded one boutique law firm with offices in Atlanta, New York City, and Silicon Valley. I listened to a previous podcast and thought, “Hey, why do people want to do a startup? That’s from your personal pain.” Definitely, for me it’s for my personal pain, right? And I can envision for the law firm and for the legal industry, this way I can have visions for the future. Right now, the law firm does have an efficiency issue, right? And also, the cost is very high. A lot of people in the community do not have money to access legal services. It’s also another challenge as well. We do have an efficiency issue that we need to fix from the inside of a law firm. Another issue is our border in the cost of the legal service. How can we serve a bigger community with a lower fee schedule? It’s like one thing from where we can start. The way I envision it for law firms and for legal practices, I think in the future there will be three types of model in legal service. First will be more self-service, but how can you let the community do self-service? We have some great tools like LegalZoom and RocketLawyer which provide self-help. It’s one type of service. But for me, my vision for the future of law firms is we can provide a subscription-like type of law firm. They can provide their own internal template for everything, letting their own customer subscribe to them. This can also become more like a self-help service to handle more routine or service for the customer. And the second thing, I think a law firm can definitely do a semi self-help service, which means it’s like a custom law firm. They can use a template created by the law firm, but when they need an attorney to do a second review, attorneys can chip-in. Even for my own law firm, we always have challenges like this. We’ll have a customer call us and say, “Hey, you know, Lucy, I have a small contract. I want it reviewed and I want you to do it.” But for me, it’s like a 20-30 page contract and it’s not even drafted by me. You have spent a lot of effort on everything. That’s the reason why I hesitate to take the money to do the case for the clients. Because for lawyers, we do have licenses and we want to do risk management. We don’t want to take too much liability. If we lose our licenses, it’s even more serious. How much money we’ll make, right? So that’s one challenge. But if the customer uses the template created by their own law firm via a business subscription, we exactly know what you’re looking for [in terms of] corrections. Our business will help us reduce attorney fees with self-help services like this. With senior lawyers building up a complicated strategy and also going to the court you will still need a traditional law firm business. That’s the way I can envision it in the future. But the question here is, how can we get out? I really believe we need technology to improve the process so I looked for other technology companies to provide a similar service for everything. One day I got fed up and I said I’ll just do it myself. That’s how I came up with aiLegal.
Lisa
aiLegal seems to be off to an amazing start. You already had your successful law practice. When you decided to put aiLegal out there, it sounds like a lot more interest comes your way. Tell me about that first launch, how did you start marketing it? How did you start getting the word out there about aiLegal?
Lucy Lu
It is hard work. We launched aiLegal form to the public like one or two months ago. We needed to find who is our target and who our customers are. It’s either we do a cloud-based SaaS contract automation platform, where a lot of businesses can generate a contract to the redline, approval and then send it to the ESIC ePay. We can talk and search the content of the contract and also do the legal analytical work. That’s what aiLegal does, too. And for us, we also provide our customers a contract template that they can utilize themselves. We do a lot of things that users can build upon their own like a contract template, documents template, and a contract workflow. We’re pretty much a self-help tool they can use themselves. We also have a template workflow inside of the system as well. We think the product can be utilized not only by small law firms but also by small businesses. Also, startups, freelancers, and even technology companies like to do things efficiently. Our product also attracted attention from a lot of large enterprises. When we were beginning our startup, we had a car manufacturing company that kept following up with us. They wanted to check out our product. We think we haven’t gotten to that level yet. I think a lot of large law firms and even large enterprises, they’re more like slow adopters. They want you to prove yourself first and have more people use your product. That’s the reason why at this point, our target customers are small businesses, small law firms, entrepreneurs, tech founders, and even freelancers. In order to reach the small law firm side, we used the integration CLEAR. CLEAR is a law firm case management system from a Canadian CRM system. We did the integration with them. It simulates a connection to aiLegal from CLEAR. We have some awesome lawyers as well. We reached out to the local community. After we reached out, we also had a lot of unsolicited customers. We have customers finding out about us from Google. We have a customer coming all the way from Nigeria who reached out to us and made a subscription. That’s our organic growth and our story.
Lisa
That’s really exciting. As far as the legal review, right now, at aiLegal, is it all on your plate? Are you expanding your team? How do you look at building a team around this opportunity?
Lucy Lu
We have a very small team of fewer than 10 people, but my team members are highly competitive. For me, that’s the reason why a lot of people say doing a startup is a lot of challenge, right? It’s definitely difficult. There’s a lot of issues with money, workload, and everything. For me, I truly enjoy it. I just feel like it’s an adventure. Let’s go grab it. Our team used to work for big companies and there’s a long procedure before we can release a product. There is a lot to review and it usually takes 6 months to a year to release a product. They told me, “Lucy, we’re so excited, because every single time we need to make a change, we brainstorm, we do the coding.” Every week, we will do this two to three times. YCan you see my point? We truly believe we built something very helpful to really transform the legal industry and will really help small business owners.
Lisa
Looking at your own law practice at lucylulaw.com, it seems like you personally have done a broad variety of law; corporate law, restaurant law, immigration law. And now you’re focused on sort of the entrepreneurial law around sales contracts and some of the business contracts. Did you find or did you feel that the laws got a greater opportunity for small businesses? Are you still pursuing immigration law? Do you see these sectors changing?
Lucy Lu
I’m a lawyer, but I think I’m not really a traditional lawyer because I’m a business owner lawyer. I run the law firm. I’m pretty much just like an in-house counsel for my own law firm. I don’t have any hiccups in doing immigration, litigation, copyright law, and everything. That is the air I breathe in daily. It’s like how I live every day. We do have a lot of small business owner clients. It’s kind of very shocking, sometimes when they want big deals but they don’t even hire an attorney. They do it themselves and some things go wrong. My clients would even tell me sometimes they use online self-help tools but they really don’t know what that they’re signing up for. This is the reason I’m talking about it. If you use a legal platform, you can hire an employee, right? Not every job offer is the same. For example, when you hire a restaurant owner it’s different when you hire a tech founder, right? If you hire people in tech for a startup company, you give them a stock option but restaurants seldom give them as well. But the problem with using a self-help tool, people really don’t know what they’re signing up for. It’s like when you’re only looking for a temporary job offer, they go looking for it, but they really don’t know what that means. What we do is we don’t only provide one solution. If you want to hire an employee, we can let you know, “Hey, what kind of position will this be like? What are their options?” In this case, we are totally different from anything in the market where they only provide you with a template where you fill in the blanks. In aiLlegal we use dynamic type technology, which means everything’s modularized. We really don’t have Word or PDF templates where we let you fill in the blanks. Everything back of the aiLegal’s data flow. That’s it. When you come to our platform and you want to create one job offer, for example, we collect your data like, “Hey, what position was this for?” Based on your feedback we assemble a different module, everything dynamic creates the data. Once the data is complete, we generate a contract in real-time and that’s when we provide the PDF/Word and everything as well. You don’t feel any delay, instantly everything is created. We like the flexibility, but we don’t feel like a lot of people will benefit from “fill in the blank” contracts because people really don’t know what they’re signing up for. We also like to keep everything simple. You don’t need to create a 10-20 page template for one job offer for us. There’s only one backbone there based on the data you input which generates everything for you in real-time. That’s what we do.
Lisa
Yeah, that sounds really smart. And I mean, as lawyers you can see how the laws are put together. You know the underlying law that these contracts are based on. We’re towards the end of the worst part of the pandemic in many ways, because vaccines are starting to roll out now. What do you think the big challenge is businesses coming to your platform will be looking for support as we move into more of the recovery phase of this pandemic, business climate?
Lucy Lu
A lot of people work at home and you can no longer go to the client-side of everything as well. How can you help your customer to do their contract and document automation remotely? Automation is very critical as well. aiLegal’s feature is that a customer can create a contract, we do the red line proofreading, approval, and we send them for signing either via eSign/ePay. We also love DocuSign and we also did an integration with DocuSign. The only thing with DocuSign is that every time you want to create an e-signature, you have to upload the paperwork to them and label where you need to sign. With aiLegal, all the content created from legal work is a computer-readable contract and everything is labeled automatically. We removed everything you don’t like in manual work. We have one customer who’s the HR person. He told us that due to the pandemic, you needed to let people go. You have to do a lot of compliance and it’s different in every state. You have to mail everything to the employee and it can be awkward for the employee to have to go to FedEx or UPS store to sign, scan and then put everything back. Most of them don’t have scanners at home and it’s kind of very awkward for the employee to experience this. It’s little things like this that show us how the pandemic changes someone’s life. Due to the pandemic, it required a lot of businesses to either be more flexible, provide a remotely convenient or efficient way for people to coordinate. Especially in aiLegal it allows them to do a team collaboration, which means you don’t need to see each other. You can still do collaborations. Our company was born in a difficult time but we’ve always had a lot of opportunities.
Lisa
That sounds good. Where should a founder go to try your platform?
Lucy Lu
You can visit our website. Our website’s very easy. It’s a very premium domain name that I paid a lot of money for. It’s www.aiLegal.com We require a log-in and registration and we also offer a free trial plan. If you just select the beginning plan, you don’t need to pay any monthly subscription fee. You will be getting the automation and everything itself. We are more like an engineer-driven team, even our CTO made sure that people have the opportunity to try to use our product for free. In the beginning, I was kind of debating, “Hey, we do need a lot of customers because right now I do have a lot of like subscription plans, want to use it to pay one year? Payment first, right? And then keep renewing everything as well.” So our CTO said, “No, Lucy. We’ll just do a monthly plan. We’ll allow users a chance to renew every month. If they don’t like it, we can even give them a refund back.” We kind of really want to build something beneficial to the customer. We want to make sure the customers like it. And also, every single time we design a product, we’re always thinking about how we can make it easier for the user to understand the concept. How can they easily utilize the product? We wanted to make everything very simple and very intuitive for people to use. That’s the whole concept for that we don’t have any hidden costs at all.
Lisa
That’s exciting. It sounds like maybe you might want a few hidden costs, but your CTO won’t let you. That’s hysterical.
Lucy Lu
Oh, no, I’m also very nice to see you as well.
Lisa
I’m sure you are. So how did you find the right technical talent for the company? How did you recruit your CTO?
Lucy Lu
My CTO’s name is Alex. He’s my alumni from China. I graduated from China from Tsinghua University. This is the best engineering school in China, one of the top schools in China. He was a computer science major and has many years of experience in large-scale computer systems. So this is what happened, we initially started casually doing something like a startup project, but it’s not a project I found in myself. That’s how we know each other but that project kind of failed. Anyway, we figured, “Oh, you know what, at least we know each other.” We’re very hardworking. We have a certain value, what kind of company we want to create? What kind of value do you want to bring to the customer? We feel like we have a lot of value like we’re similar. That’s the reason. Even we have a failed collaboration from the previous startup but it molded how we coordinated with each other and it created a solid foundation for us to do aiLegal.
Lisa
Well, there certainly is a huge market. I mean, speaking as an investor working with startups every day, there’s so much legality to building a startup properly, and it really doesn’t pay to cut a lot of corners. So it’s really fascinating. I think the business that you’re building is really an interesting one and let me ask a question from the dumb corner.
Lucy Lu
Hey, there’s no dumb corners. In your specialty, I’m in the dumb corner. We just have different specialization skills, okay?
Lisa
Tell me a little bit about the compliance of the forms in the form builder engine on aiLegal. Does it work across all states? Does it work in specific countries? I mean, are there any boundaries right now for the platform in 2021, as our listeners who are mostly in Atlanta, think about checking it out?
Lucy Lu
It really depends. Right now at aiLegal, we do provide a system where we allow customers to create their own template and workflow. aiLegal is not only strictly for Georgia and not only available in the US, but we built this to do globally. It doesn’t matter which country you’re from. We do have a customer from Bulgaria as I mentioned also from Nigeria and China as well. In order to reach this step, we have to build a structure correctly otherwise these structures will crack. The workflow will not have created a basic way that was different from international jurisdiction. It depends on a system-defined or like a project template. One good example is for any company when you’re terminating an employee, there’s an employee determination process. Each state has a different regulation, every state is different. They require certain lawyers and a knowledge base to do the management. With aiLegal, we integrate a termination process for Georgia, for New York. for California. As I said, we allow the customers to build up their own workflow and their own template. So in that case, it doesn’t matter which state you’re in or which country you’re from. We like the flexibility that you can build up anything you want and anything you like.
Lisa
Fascinating. Thank you so much for sharing with our listeners, there’s a lot of founders in our listenership that are going to totally enjoy checking this out and seeing what it can do for their growing businesses. I’m really glad to hear about it. So new and yet really fresh. Is there anything we should talk about that we haven’t covered, though, before I let you get back to the building?
Lucy Lu
The first thing is I want to give some feedback for myself from one lawyer to the tech founders. One feedback I want to share with a potential audience as well. Second thing, I do have another follow-up question, which I can ask you later. What’s the difference between female entrepreneurs from our male competitors? Well, how can we make ourselves very competitive as well, compared with our male friends? Let’s go with the first feedback. I want to mention it’s like a wide experience. I want to share the potential. It doesn’t matter if you’re a female entrepreneur with a non-tech background. This is really my learning lesson. When we first started the aiLegal, I thought even if I have a law background, I have domain knowledge, I don’t have any technical background. So in the beginning, I kind of didn’t want to get my hands too dirty. After almost 10 months, I started a journey. I felt like this was a totally big mistake. As a founder, we have to get our hands dirty. Like, the first few months it does not work because I do not get my hands dirty? And the answer was no, I think I have to include myself in everything. I joined in every single backend, in the design of a product feature, and everything myself. I brainstorm with our tech team and it was at that point when the company really moved much faster. For founders with no tech background, you have to get your hands dirty. Don’t feel like you do not have a technology background, you kind of get afraid, and you don’t have confidence. You know what, you’re the founder, you’re the CEO of the company, you can do that. Just go move, ask, and do it. That’s it. That’s my feedback for other people.
Lisa
I love that and I totally agree, Lucy. I mean, not only do you bring it so much better than I do, but it’s the truth. You know, technology is hard and you do need experts writing your code, but how are they going to know what to write? How are you going to know if they’re writing it well, and how fast should they be writing it based on benchmarks? What kind of QA testing are you doing and all these things there is nothing outside the scope of the early-stage founder. That’s why they say that founders are a jack of all trades and masters of none because we wouldn’t necessarily be able to build the system. But we better well understand the architecture, why we’re making that choice, all of the requirements that are going into it, and be able to troubleshoot and you’re right. So I just couldn’t agree more. Your second point was?
Lucy Lu
Ah, yes, and how we can make ourselves more competitive. Honestly speaking, I noticed there were more male tech founders compared to female tech founders. What I want to see is how we can align our own resources. How can we guide or coach even more female entrepreneurs in tech like me without a technology background? How can we do a better job? That’s what I want to get guidance from you, Lisa.
Lisa
Well, thanks, no pressure. I’ll say right away. I think that to some extent, there are fewer women in tech not because women need to do better. I think the culture needs to do better. I think the culture discourages a lot of women from tech. Men and women make the culture so that’s not just blaming the men for those of you who are listening, and you’re like, “Oh, no, she’s blaming the guys.” No, women also hold up half the sky. And it is also on us to carry the flag for our gender so high, that it is not acceptable in culture to discriminate on the basis of trade and gender. And that’s a frontier in the global culture. So, you know, as the rubber meets the road, I think it’s super clear that women are just as talented, just as capable as men, that is a no-brainer.
Lucy Lu
Definitely correct.
Lisa
But then when you look at the actual path, because of the way our culture is, we do tend to have more men in tech, we have to ask ourselves why? I don’t think any person can change the culture. But together, we can change the culture. So more points, like why is it like this? And, how do we make it different? One of the things that I very much like are some of the tech organizations that are more female-led. So for example, I tend not to align myself with organizations where I see all-male panels. They don’t get it. And I’m not going to align myself with, let me be very honest, here, the losers, because if you have all-male, or even all-female, or all any one type of person in a global economy, you’re not setting your organization up for success.
Lucy Lu
I can agree, I happen to agree. You need people with different diversity. Diverse people have a different assault, a different liking, or brainstorm together. Let’s bring the energy, the company does need energy. Without energy, this will be a data company, I totally agree with you, Lisa.
Lisa
I use that as a guiding principle, I’m guided by the principle of inclusion and I look for organizations that are inclusive to be aligned with. You can see it in the culture of the leadership, you can see it in the panels of the associations, and you can really get a feel for it at the board level. I will look up the board of an organization and see how much they prioritize the future of their firm, somewhat based on the diversity of opinions, experiences, and backgrounds sitting around the table. So that’s what I would say to you is, don’t play with those who are stuck in a very narrow way of thinking. Reserve your energies for those that have a progressive growth mindset and see like you do the bigger world. It’s not about states. It’s not even about countries. For the world, it’s little and that’s the kind of thinking that will get it done.
Lucy Lu
Thank you so much, Lisa. We have restrictions and limitations but we should not limit ourselves and try to think out of the box. Try it and just do it. Keep doing it and it’s gonna bring great results.
Lisa
It was great speaking with you, Lucy. Thank you so much for your time.
Lucy Lu
Thank you so much, Lisa. I really enjoyed talking with you. I’m definitely gonna continue to listen to your great podcast. I love it.
Lisa
Thank you for listening to the Atlanta Startup Podcast. You know, we’re not just a podcast, we’re a community, and we’d love to see you at one of our digital or physical events, go to valor.VC and sign up for an event that makes sense for you. We have events for founders and the investors who back them. Another event you might enjoy is Startup Runway. The Startup Runway Foundation is a Valor organization that provides $10,000 grants to founders who are women or people of color building next-generation software products. Applications are free and we’d love to hear from you at startuprunway.org. And as always, thank you so much to the organizations that make this podcast possible. Not only Valor Ventures, but also Write2Market, a tech marketing and PR agency in Atlanta, Georgia, and the Startup Runway Foundation and Atlanta Tech Park Valley’s headquarters, and also headquarters for over 100 local entrepreneurs, building global businesses. See you next week. Please bookmark the podcast and join us.
