Minford: Law firms not solving clients’ immediate problems
Intellectual property (IP) firms based on a partnership model “will struggle to invest what is needed for the long-term future”, the chief executive of global IP firm Rouse has predicted.
Luke Minford also said lawyers were wrong to see AI as simply an “efficiency opportunity” to help them solve the “cost problem”.
Mr Minford said that, since 2022, when private equity firm MML Capital took a 35% stake in Rouse, the firm had increased five fold the amount spent on technology and data.
Rouse has more than doubled in terms of revenue and people, and now has around 1,100 staff, with about half of them being lawyers.
The firm, which began life in England in 1990 and now operates as a network of local subsidiaries of Rouse International, has moved from having partners to having ‘principals’, who have a share in the firm but not a profit share.
Mr Minford described most IP firms as “sub-scale partnerships” and he knew from his experience that “these partnerships will struggle to invest what is needed for the long-term future” because they were motivated to “pay out the profits in the here and now which means that they underinvest in tech and data”
Every year they did this was “compounding the technology debt and making it even harder to catch up”.
He said the biggest barrier to change was people thinking that “expertise is enough”.
Mr Minford went on: “It has to be expertise combined with something else. Some lawyers talk about AI as just an efficiency opportunity, enabling them to solve the cost problem.
“That’s not it. This is about foundational change. I’m talking about a fundamental re-imaging of the value proposition, where you expertise is part of the solution but the important thing is how you combine it with technology and AI.”
Mr Minford said the three answers that “kept coming back” from client research were the need to get costs down, the “complexity of the legal landscape” – whether it was about regulation, geo-politics or the speed of digitisation – and the need of businesses for more “clarity and certainty” in legal services.
Clients said technology and data providers were helping them most with these challenges and they “don’t generally talk about their law firm”.
However, when it came to what they really valued and cared about it was the relationships with their lawyers, particularly over 20 or 30 years, the quality of their advice and support, and the understanding of their business and the context in which it operated.
“They say ‘It’s the IP lawyer who gets my business and knows what I need’,” he explained.
Clients were left “managing these two worlds”, with the technology and data providers solving immediate problems and law firms dealing with what really matters.
If clients found a provider that could both these things, they were “euphoric”. Where they really wanted to spend the time was on neither of the things but on their business.
Mr Minford predicted: “I don’t think the technology and data providers will get there as fast as the advisory firms, because it’s a people-first solution that clients want.”