- In three years, Harvey went from an unknown startup to a pivotal AI force within the legal industry.
- CEO Winston Weinberg spoke to investor Sarah Guo on a podcast about how the legal field is changing.
- He highlighted how the work of young lawyers will evolve and why billable hours may go up in cost.
Harvey, a startup focused on legal and professional services, has a message for lawyers worried about chatbots coming for their jobs: We come in peace.
Founded by a former lawyer and an ex-DeepMind researcher, the company has taken over the legal world by worming its way through leading firms. It hired lawyers as domain experts and linked arms with high-profile firms like A&O Shearman and PwC early on to develop software for legal professionals.
Harvey investor Sarah Guo recently spoke to Winston Weinberg, Harvey's lawyer-trained founder and CEO, on her podcast, "No Priors." They covered the skepticism among some lawyers regarding artificial intelligence and its potential impact on the industry. Weinberg tried to ease those concerns.
"I don't think there is as much displacement fear," Weinberg told Guo. "It is not job displacement, it is task displacement. And I think that's a super important distinction because getting rid of those tasks does not mean the legal industry falls apart. It'll evolve."
Weinberg's reassurance has backing from the who's who of venture capital. Just last month, the company announced it had secured $300 million in Series D funding to further develop its platform and expand its team. This new round saw participation from return investors such as Sequoia, Kleiner Perkins, GV, Elad Gil, Guo's Conviction, and the OpenAI Startup Fund, along with new backers Coatue and LexisNexis.
Here are three other predictions the Harvey founder shared about the future of law.
Junior associates become more valuable
The majority of junior associates are hired to do one thing: produce as much billable work as possible. These young attorneys are expected to put in grueling hours of case study and research. They are the foot soldiers of the profession.
And so the notion of a law firm using software to automate away parts of the profession might seem scariest for the people responsible for this grunt work. Not so, according to Weinberg.
"The junior folks are incredibly happy about this," he told Guo on the podcast.
The Harvey founder says that most junior associates spend the first leg of their careers on rote tasks. "So whether that's in reviewing documents in discovery or it's reviewing documents in a data room, et cetera, you end up not being able to do the strategic level things until like 10 years into your career, if you're lucky, five," he said.
Software like Harvey allows them to get tasks done faster. "And so what I think will end up happening is the timeline will compress," Weinberg said, "so you will start being able to actually do the high-level strategic work and interact with clients, which is what people really want to do earlier on in your career."
Billable hours go up in cost
The unstoppable march of artificial intelligence has fanned a long-running debate over the potential death of the billable hour or the standard method of payment in the legal profession.
The idea is that when a firm uses software to speed through routine tasks like document review and due diligence, the number of billable hours to a client is likely to be reduced. The Harvey founder believes, however, that even as billable hours fall, the value of a lawyer's time is likely to increase.
"I don't think the billable hour is going to just completely disappear," Weinberg said. The mundane, repetitive tasks can be automated with a lawyer in the loop. "Those tasks will end up being kind of a fixed-fee model," he explained, "and I think the high-level advisory work on top will still be billable hour and will be actually maybe more expensive."
"There's an argument that the specialist at a law firm who has seen all of these different mergers in the pharmaceutical industry, their rates for hours should not be actually 3x the junior associate in the data room, maybe 10x, I don't know," Weinberg said. "My point is there is a specialization in professional services that is incredibly valuable and is going to be more valuable over time."
Other attorneys echoed this belief when speaking to Business Insider's Natalie Musumeci last fall. Frank Gerratana, a partner at the international firm Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., posited that in the future, "lawyers can simply charge more per hour because they're spending more time on the highest value work." Michel Paradis, a partner at the global firm Curtis, Mallet-Prevost, Colt & Mosle LLP, said firms will charge a premium for "the real value that lawyers provide."
Do you have a story to share about how AI is changing the legal world? Contact this reporter at [email protected].
