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Atrium shuts down, laying off 100

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Re: Atrium shuts down, laying off 100

#41

Post by gnicholas »

I swung by the Atrium booth at the Startup Grind conference a few weeks ago. A former lawyer, I was curious to hear their pitch. It was basically: we get you cheap lawyers, and we help them find new clients.

I asked if all of their lawyers are based in the US, and they couldn't give me a straight answer. Eventually, when I said "well, of course they must all be US-licensed lawyers, right?" they said "oh, yeah, they must all be in the US then."

It was not a confidence-inspiring conversation, and I can't say I'm surprised that they're shutting down.

Re: Atrium shuts down, laying off 100

#42

Post by eganist »

ttul wrote: post #20
noway421 wrote: post #12

It sucks. Not even sure they should've called it so fast, why not keep going and try to figure it out till the money runs out. Investors would be OK with that. I wonder when Justin lost his conviction? I don't believe you can lose conviction in 2 month.

If you're already rich (as Justin is) and realize how big an upside can be, why not flush the toilet and start over? For a guy like Justin, time is the most precious commodity because money is meaningless.

This is great advice for an established founder, which might be why it's simultaneously one of the most damning reasons to avoid working for one.

Re: Atrium shuts down, laying off 100

#43

Post by mbesto »

gumby wrote: post #10
minimaxir wrote: post #2

This happened less than 2 months after a "pivot to tools": https://news.ycombinator.com/item?id=22040238

Never really seen a "pivot to tools" work (after I tried it with one company, and it failed, I started noticing when others tried it too).

I see business services companies build tools in their vertical industry and become successful all of the time. You just can't take venture funding.

Re: Atrium shuts down, laying off 100

#44

Post by harryh »

eganist wrote: post #42
ttul wrote: post #20

Earlier quoted context omitted.

If you're already rich (as Justin is) and realize how big an upside can be, why not flush the toilet and start over? For a guy like Justin, time is the most precious commodity because money is meaningless.

This is great advice for an established founder, which might be why it's simultaneously one of the most damning reasons to avoid working for one.

Working at a zombie company with very little chance of success isn't a great gig either. Shutting it down cleanly, paying decent severance, and letting the staff move on is a good move for them too.

Re: Atrium shuts down, laying off 100

#45

Post by taneq »

gnicholas wrote: post #41

I swung by the Atrium booth at the Startup Grind conference a few weeks ago. A former lawyer, I was curious to hear their pitch. It was basically: we get you cheap lawyers, and we help them find new clients. I asked if all of their lawyers are based in the US, and they couldn't give me a straight answer. Eventually, when I said "well, of course they must all be US-licensed lawyers, right?" they said "oh, yeah, they m…

So it was basically Craigslist for lawyers?

Re: Atrium shuts down, laying off 100

#46

Post by eganist »

gnicholas wrote: post #41

I swung by the Atrium booth at the Startup Grind conference a few weeks ago. A former lawyer, I was curious to hear their pitch. It was basically: we get you cheap lawyers, and we help them find new clients. I asked if all of their lawyers are based in the US, and they couldn't give me a straight answer. Eventually, when I said "well, of course they must all be US-licensed lawyers, right?" they said "oh, yeah, they m…

Legal is a notoriously sluggish industry, one that's almost infuriatingly incapable of adopting change and technology. Atrium's original pitch was exactly the opposite of what most legal teams are used to interacting with, and I can't think of a single biglaw attorney (sorry for the anecdote) who had faith in the idea or its execution.

The original concept, as a reminder: https://techcrunch.com/2018/09/10/atrium-legal/

Now it's easy to say that this should've been obvious in hindsight. (Should've been obvious to me, anyway; I cold-mailed Justin and Nick years ago looking to build a specific function within Atrium to address concerns I'd heard on background about the service offering; I never did hear anything back about that.) But that said, I can't help but think the original pitch by Atrium was just too bitter a pill for the most conservative industry in the United States to swallow. Shoot, lawyers are bizarrely resistant to moving to e.g. Signal to preserve attorney-client privilege; given this, I have a hard time thinking of many who would trust ML models with understanding case-law.

Re: Atrium shuts down, laying off 100

#47

Post by g_p »

gumby wrote: post #10
minimaxir wrote: post #2

This happened less than 2 months after a "pivot to tools": https://news.ycombinator.com/item?id=22040238

Never really seen a "pivot to tools" work (after I tried it with one company, and it failed, I started noticing when others tried it too).

In the case of Atrium, it also sounded like their "pivot to tools" was trying to take many of their existing (ex) employees on the legal side, and convert them into clients of the tools.

While the legal and tools companies were together, I'm sure the lawyers enjoyed the shiny tools. But after the "pivot", with the lawyers seemingly going it alone with some of the former clients, it seems likely to me that Atrium (the tool) just wasn't offering enough of a value proposition to make the tool company profitable.

Venture money needs massive growth. Selling a tool to lawyers will get an amount of money per month proportionate to the number of fee-earners. And from the sounds of things, their tools weren't exactly going to be irreplaceable. Anyone got any direct insight as to if the tools themselves were compelling but the pivot failed, or if the tools didn't deliver?

Re: Atrium shuts down, laying off 100

#48

Post by tempsy »

baddox wrote: post #14
tempsy wrote: post #13

Earlier quoted context omitted.

working at a zombie company that has no traction is not fun for anyone part of the “challenge” of being a famous founder is you can raise pre product. $75M seems insane for a company like that. Burn couldn’t have been that high, mostly rent and salaries, no heavy computation, etc.

Wouldn't rent and salaries (at least in the SF Bay Area) almost always be vastly more expensive than computation?

Depends on the company. If it’s a marketplace like Uber then you’re burning a lot of operations. If it’s ML or heavy compute then AWS bills.

Re: Atrium shuts down, laying off 100

#49

Post by eganist »

harryh wrote: post #44
eganist wrote: post #42

Earlier quoted context omitted.

This is great advice for an established founder, which might be why it's simultaneously one of the most damning reasons to avoid working for one.

Working at a zombie company with very little chance of success isn't a great gig either. Shutting it down cleanly, paying decent severance, and letting the staff move on is a good move for them too.

Absolutely, but at the same time, the founder and team with nothing to lose is more likely to pull a rabbit out of that blood-equity-soaked hat.

I'd rather pitch into the latter, which I suppose is sunk cost fallacy manifest.

Re: Atrium shuts down, laying off 100

#50

Post by paultopia »

eganist wrote: post #46
gnicholas wrote: post #41

I swung by the Atrium booth at the Startup Grind conference a few weeks ago. A former lawyer, I was curious to hear their pitch. It was basically: we get you cheap lawyers, and we help them find new clients. I asked if all of their lawyers are based in the US, and they couldn't give me a straight answer. Eventually, when I said "well, of course they must all be US-licensed lawyers, right?" they said "oh, yeah, they m…

Legal is a notoriously sluggish industry, one that's almost infuriatingly incapable of adopting change and technology. Atrium's original pitch was exactly the opposite of what most legal teams are used to interacting with, and I can't think of a single biglaw attorney (sorry for the anecdote) who had faith in the idea or its execution. The original concept, as a reminder: https://techcrunch.com/2018/09/10/atrium-lega…

The other thing about the original vision is that it isn't even remotely clear what the hell they're doing. Are we really talk about having ML models understand caselaw? (In which case, thompson reuters is going to be way ahead anyway always, and they suck, see, e.g., the horror that is the latest version of westlaw.) Or are they talking about building a bunch of efficiency tools?

I feel like the latter model could have worked as a law firm doing the latter. Like, an actual, ordinary, perfectly milquetoast, law firm, hourly billing and all, except with an R&D division that tries to build workflow efficiencies and uses them to compete on hourly rate. Which, come to think of it, isn't that just what Dentons is doing? So maybe it's just American lawyers that are hopelessly hidebound.

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