How the Legal System Tries to Prevent You From Getting Meaningful Help for Your Legal Issue (& Why Innovation Will Prevail)
Legal Regulations are changing — but there’s still so much work to be done.
I’ve been a lawyer for 16 years but I’m not allowed to provide you with legal advice.
At least not in my capacity as a Founder and CEO of Hello Divorce. In fact, none of our employees can use their legal expertise to help you solve a legal problem. Instead, we have to rely on software solutions, a killer customer service team, helpful content and a partnership with (my) law firm.
Why? In short, (some) lawyers are afraid that new methods of delivering legal services will impact their ability to charge you lots of money — and since lawyers regulate themselves, they are incentivized to stifle innovation.
With limited exceptions, existing regulations require lawyers and paralegals (super experienced professionals who know the ins and outs of the legal process & system) to only provide legal advice and/or help to consumers if they work for a law firm.
But….
Law firms can only be owned by lawyers. Unlike a traditional startup, lawyers have to fund their own innovation and cannot attract talent with a promise of equity.
But we know better. We know that rules might be a barrier to entry for most — but a source of motivation for others. Think: Legal Zoom, Upsolve (Bankruptcy), Boundless (Immigration).
We also know that 77% of legal issues go unresolved by a lawyer. (World Justice Project) There are trillion dollar opportunties sitting there to better bridge the access to justice gap. And while some people cringe at for-profit companies tackling these issues — we’ve seen it happen in every industry — wildly successful companies that have turned dreadful, clunky, expensive services and products into a friendly, convenient, more affordable user experience: Turbo Tax, Policygenius (Insurance), Own Up (Mortgages), Airbnb (Travel).
A note to investors: There has never been a better time to invest in B2C legal tech. The regulatory scheme is changing in many states — albeit slowly. And only a handful of companies are implementing solutions that meet the needs of consumers while complying with existing regulations — that’s a competitive moat.
The ‘first to market’ advantage — is still very much a thing in B2C legal — and that’s well, super hot. New B2C #justicetech companies are poised to take advantage of states like Arizona and Utah who have implemented new regulatory schemes. Innovative companies with interdisciplinary teams have options — can help people opt out of the system all together (when possible) or resolve conflict even before they file forms with the court so there’s little chance of a prolonged, expensive ordeal.
After all, no one wants a long, expensive, stressful legal mess — they just haven’t have tools (until now) to avoid it. Law has always been so localized — but companies that can take advantage of a wider market (think: accessibility, language, geography etc.) and look beyond solving legal issues — but also on the practical matters that create, exacerbate or complicate things like divorce. Startups (versus law firms) have the flexibility to dive deeper into the ecosystem and create meaningful solutions to every day issues while building a great product that people love.
