A top-10 law firm will float on the stock market in the next couple of years, a senior former legal regulator predicted last week.
He also argued for rapid regulatory authorisation for lawtech start-ups delivering legal services and that regulators should ‘get out more’ to understand the market better.
Crispin Passmore, speaking at the online Lawtech Sandbox Showcase – an event held to celebrate the latest ‘sandbox’, which helps selected lawtech start-ups accelerate their growth – suggested Allen & Overy might be the first large firm to go public.
He said: “I suspect that in the next couple of years we’ll see one of the top-10 law firms float.”
He was commenting on the advantages listed law firms had in keeping their businesses alive to outside views, in contrast to firms run on the traditional partnership model.
Having non-executive directors was beneficial, he said. It was the same with private equity, in the sense that non-lawyer investors brought experience of other industries.
Introducing the event, Jennifer Swallow, director of LawtechUK, described the sandbox as “an innovation environment designed to accelerate the pace at which we can bring lawtech products and services to market”.
It provides the chosen start-ups with access to data, to legal regulators and to collaborators, namely decision-makers in law firms.
Ms Swallow interviewed justice minister Lord David Wolfson QC, who urged law firms to “jump on board the lawtech train”, which was about to leave the station whether or not they did.
He added: “I don’t think lawtech is a ‘nice-to-have’. It’s not an optional extra, this is the future, it is a ‘must-have’ that is really non-negotiable… If the last two years have shown us anything, it’s that if you want to stay relevant and competitive and you need to embrace technological change.”
Speaking on a panel of data experts and regulators, Mr Passmore, who was director of policy at the Solicitors Regulation Authority until 2018, advised legal regulators to “keep it simple” when it came to regulating lawtech start-ups.
He suggested that all regulators spent one day a week out and about “engaging with businesses [which are] trying to do things differently on the front line” in order to understand them and take the knowledge back into their organisations.
He continued that authorisation processes were “too long and cumbersome” and should be rubber-stamped as long as start-ups “self-declared” they had complied. A “one-week approval process for people to enter markets” should be sufficient, he said.
Amy McConnell, head of legal operations at Vodafone Business, said she would like to see lawtech pioneers aiming more at helping “the average person on the street” with access to justice, such as employees, tenants and visa applicants.
But she acknowledged that much of business involved contracts. Start-ups making legal contracts smarter would help businesses grow.
Bruce Braude, chief technology officer of Deloitte Legal, the showcase’s sponsors, said he was “excited” that lawtech start-ups were beginning to provide legal services themselves.