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Atrium lays off lawyers, pivots to tools

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Re: Atrium lays off lawyers, pivots to tools

#31

Post by nrp »

duxup wrote: post #14
heymijo wrote: post #9

Earlier quoted context omitted.

If I had to guess based on parsing these articles, Atrium went up against incentives in the legal industry and lost. [0,1] Legal firms bill hourly. Efficiency means less billable hours. (warning: moving into personal experience and conjecture) Yes, boilerplate forms for repetitive use cases seems like it should be a thing, but in my experience building businesses, every lawyer I have dealt with has found any reason p…

I wonder what the yin and yang in customer's minds are with "Thank goodness my law firm is saving me money by generating these documents for cheap!" And "You know this is kinda important but I'm not sure I want discount lawyer's on this who automate paperwork...."

Most/all law firms have templates they hold internally and modify slightly for their clients. Very few billable hours are going into handing you your standard agreements like NDAs, offer letters, CIIAA, and so on. Your lawyers are really there to help you when things go non-standard, which is inevitably going to happen with any non-trivial business.

I evaluated Atrium out of curiosity when I was looking for a law firm for incorporation purposes. I filtered them out after the first call because they weren’t set up to handle the slightly unusual setup I had, which other law firms had no trouble with.

Re: Atrium lays off lawyers, pivots to tools

#32

Post by serf »

anotherfounder wrote: post #23

https://www.atrium.co/inside-atrium/the-future-of-atrium/ For someone who has spent so much telling founders to cut buzzwords and speak in plain and simple English, this blog post by Justin Kan is something special. Case in point: > Similarly, at Atrium, we’ve made the tough decision to restructure the company to accommodate growth into new business services through our existing professional services network. Simple…

>Honest question, why do companies do this? It seems disrespectful to everyone - employees (both fired and current), customers, and any adult for that matter.

generally because it keeps the person who wrote it hire-able post closure, and makes those that lost money or effort on the deal feel as if their loss is actually being spun into something else, like concepts, innovation, future profitable IP, whatever.

I agree, I think it's disrespectful, but then again there's a lot about business that I feel that way towards.

Re: Atrium lays off lawyers, pivots to tools

#33

Post by dundermuffl1n »

rayiner wrote: post #8

> Even lawyers aren't immune to the unpredictability of working for a startup—and the appeal of generating high margins from selling software instead of human services. Companies tend to do the opposite, though, right? Apple could increase its margins by selling iOS and the Ax processor IP. But it makes more “boatloads of money” selling hardware, even at lower margins. Instead of selling IP, Apple uses its superior I…

Wrong. Apple sells its software for an extremely high margin already.

When you buy Apple hardware, you are locked in to use Apple software and nothing else. A hardware vendor like LG/Oppo/Xiaomi would rely on Android, a commodity software, and thus, have very little pricing power against its competitors. Even though the technical specs of these phones might be better than the iPhone, they would struggle to sell for half the price.

The software lock is further amplified by those custom chips that are used across the Apple ecosystem. You're likely to pay exorbitant prices for the software on MacBook and iPad as well.

Remember, Apple usually doesn't touch a single phone throughout the manufacturing process (Most of the components are manufactured by third-party vendors squeezed into razor-thin margins). After paying these vendors off, they get to turn around and sell the same hardware for $600-650 more on the market. That wouldn't have lasted if they had licensed iOS out, their pricing power would be severely diminished.

Re: Atrium lays off lawyers, pivots to tools

#34

Post by duxup »

nrp wrote: post #31
duxup wrote: post #14

Earlier quoted context omitted.

I wonder what the yin and yang in customer's minds are with "Thank goodness my law firm is saving me money by generating these documents for cheap!" And "You know this is kinda important but I'm not sure I want discount lawyer's on this who automate paperwork...."

Most/all law firms have templates they hold internally and modify slightly for their clients. Very few billable hours are going into handing you your standard agreements like NDAs, offer letters, CIIAA, and so on. Your lawyers are really there to help you when things go non-standard, which is inevitably going to happen with any non-trivial business. I evaluated Atrium out of curiosity when I was looking for a law fir…

Yeah I have some limited visibility to a very large law firm. Paperwork you can just script never comes up as a problem and it's not like these organizations would just duplicate effort like that if they could avoid it / save themselves money.

Also I never got the impression that the really profitable customers are shopping for those kinds of efficiencies....

Re: Atrium lays off lawyers, pivots to tools

#35

Post by staticautomatic »

duxup wrote: post #5

>Its goal was to improve on the traditional law firm model, by developing software to improve efficiency for both its attorneys and clients. Any word on what they actually were doing to gain these efficiencies?

There are a great many things in legal practice that are ripe for automation but the vast majority are junior associate-level tasks at best. Nobody is going to automate a non-negligible portion of a $500+/hr partner's job. The best you can realistically accomplish is automating work that large groups of people billing $150/hr or less would perform in parallel.

Re: Atrium lays off lawyers, pivots to tools

#36

Post by rayiner »

heymijo wrote: post #9
duxup wrote: post #5

>Its goal was to improve on the traditional law firm model, by developing software to improve efficiency for both its attorneys and clients. Any word on what they actually were doing to gain these efficiencies?

If I had to guess based on parsing these articles, Atrium went up against incentives in the legal industry and lost. [0,1] Legal firms bill hourly. Efficiency means less billable hours. (warning: moving into personal experience and conjecture) Yes, boilerplate forms for repetitive use cases seems like it should be a thing, but in my experience building businesses, every lawyer I have dealt with has found any reason p…

The initial pitch (from your link) contradicts the rationale for the pivot.

The premise they started with was that its hard to sell efficiency enhancing software to lawyers because the billable hour discourages increasing efficiency. The solution was to become a law firm, offering fixed fees to secure business and leveraging the software to increase efficiency and enhance profitability.

> Atrium LLP is trying to solve this by charging fixed pricing for work. It plans on doing this by building models to predict how much work will be needed for different types of projects. Even if the models aren’t perfect at first, it doesn’t really matter: regardless of whether it is higher or lower margin initially, the point is that when are have a fixed price for service, it is your internal incentive to reduce cost over time. That is how the market drives lower cost for customers. When you have buyers who pay suppliers based on cost plus, you get high prices that don’t trend down over time (think government contractors). When you have fixed pricing, costs generally come down over time.

By shifting away from charging for services to selling software, you’re back to the initial problem: law firms don’t want to pay for efficiency enhancing software because the billable hour discourages it.

Re: Atrium lays off lawyers, pivots to tools

#37

Post by tempsy »

serf wrote: post #32
anotherfounder wrote: post #23

https://www.atrium.co/inside-atrium/the-future-of-atrium/ For someone who has spent so much telling founders to cut buzzwords and speak in plain and simple English, this blog post by Justin Kan is something special. Case in point: > Similarly, at Atrium, we’ve made the tough decision to restructure the company to accommodate growth into new business services through our existing professional services network. Simple…

>Honest question, why do companies do this? It seems disrespectful to everyone - employees (both fired and current), customers, and any adult for that matter. generally because it keeps the person who wrote it hire-able post closure, and makes those that lost money or effort on the deal feel as if their loss is actually being spun into something else, like concepts, innovation, future profitable IP, whatever. I agree…

He got the same feedback on his accompanying tweet https://twitter.com/justinkan/status/1216896251754450946?s=2...

Bigger red flag from his tweet is there’s basically zero engagement from others in the tech community. For someone who is that high profile to tweet something big about his startup and get almost no responses is really strange.

Re: Atrium lays off lawyers, pivots to tools

#38

Post by bradlys »

tempsy wrote: post #18

I think anyone considering a job at a company founded by a serial entrepreneur should heed this as a warning. These founder raise pre product market fit because they can, and often raise too much money. Having too much money when you don’t really have a viable product that people want can easily turn your company into a zombie, where people are just sort of going through the motions because there’s nothing else to do…

I had the opportunity to interview with Atrium over a year ago. It was very clear that they weren't doing well. Their founding team had opposing ideas about how to do things. Their CTO was fired very early on. Clearly, it hasn't worked out smoothly. To me, it looks like they just rode on the wave of eager investors.

I've seen the issue with wealthy enough employees at all the startups I've been at too. Once you get people who no longer feel a certain hunger, they lose ambition and direction quickly. I've seen it happen as startups go from mildly successful to unicorn. Where the founders were able to cash out enough to buy a house in the bay, they suddenly were way less eager about being acquired or IPOing. And I've seen it with people who are on the tail end of their careers, exiting one startup with a very sizeable amount to enter another. The hunger is gone for them, they're just coasting, and they don't seem to have any real reason to even be working beyond avoiding boredom in retirement.

And the worst part is that it feels like these types of people are way too well represented at the top of the hierarchy. The part of the hierarchy where these attitudes matter the most!

Re: Atrium lays off lawyers, pivots to tools

#39

Post by choppaface »

anotherfounder wrote: post #23

https://www.atrium.co/inside-atrium/the-future-of-atrium/ For someone who has spent so much telling founders to cut buzzwords and speak in plain and simple English, this blog post by Justin Kan is something special. Case in point: > Similarly, at Atrium, we’ve made the tough decision to restructure the company to accommodate growth into new business services through our existing professional services network. Simple…

I’m not sure the author is giving much consideration to the critical thinking skills of the public—- that’s more of a big company CEO thing. A lot of founders are genuinely happy to escape a failure and are already emotionally in the future by the time the blog gets written. Save the stress for the next thing.

And this is Justin Kan. Not somebody who ruminates, and somebody who went through a ton of pivots with Justin TV. This sort of result is no big deal to somebody like him.

Re: Atrium lays off lawyers, pivots to tools

#40

Post by [deleted] »

rayiner wrote: post #36
heymijo wrote: post #9

Earlier quoted context omitted.

If I had to guess based on parsing these articles, Atrium went up against incentives in the legal industry and lost. [0,1] Legal firms bill hourly. Efficiency means less billable hours. (warning: moving into personal experience and conjecture) Yes, boilerplate forms for repetitive use cases seems like it should be a thing, but in my experience building businesses, every lawyer I have dealt with has found any reason p…

The initial pitch (from your link) contradicts the rationale for the pivot. The premise they started with was that its hard to sell efficiency enhancing software to lawyers because the billable hour discourages increasing efficiency. The solution was to become a law firm, offering fixed fees to secure business and leveraging the software to increase efficiency and enhance profitability. > Atrium LLP is trying to solv…

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