EP #81: Watching BigLaw Reinvent Itself with Gina Passarella & David Gialanella

Speaker A: Greetings, listeners. Howard and I sat down with two senior editors who cover big law for a living and are now living a merger of their own. They've spent decades tracking partner comp, lateral markets and law firm strategy. They're now mapping the profession all the way to 2040. We dig into what firms are hiding from themselves, whether big law will ever go public, and why the partnership model may be its own worst enemy. Enjoy. Welcome everyone to the Future's Bright podcast. My name is Chris Batts and joined by my co host, Howard Rosenberg. Howard and I are at the center of law firm talent and strategic growth here in New York City. Howard is a partner in the head of talent, intelligence and acquisitions at Barretts and Brunel, and I advise on law firm mergers, PE investments and strategic growth at Columbus Street. And today we have two very exciting guests, Gina Passarella and David Galanella. Gina and David, welcome to the podcast.

Speaker B: Thank you so much. Excited to be here.

Speaker C: Thanks Chris and Howard for having us.

Speaker D: So Howard and I are just uh, thrilled to have you both on, um, and appreciate your guys availability. Um, so knowing Gina, that you've been with ALM since 2005 I believe, and David, you've been there since 2010, um, through lots of different roles. I'd love for you guys to share the evolution of this organization because, um, last year there was a big announcement and we'd love to hear from you guys what that means, what that looks like and um, what to expect going forward.

Speaker E: Sure.

Speaker B: No, I know. I feel like we're now living and breathing the things that we often write about for the law firm perspective, mergers and integration and all the things um, that we're now seeing firsthand, so a whole new perspective. But yes, it's been um, it's been a really exciting ride and I think I've been here for as long as I have been because the company and the industry have evolved in such interesting ways. And it's always new, it's always bigger, it's always just changing in these fascinating ways. And so we've really, as an organization tried to map to the growth of the industry and make sure that we are following where it's going, meeting the needs of the industry and really being as ahead of the curve as we possibly can be and identifying where it's headed, what that means, leveraging the data that we have, all those things. And so none of that is changing in this new world order. But we did, yes, a little over a year ago merge, um, the legacy ALM brands and the legacy LBR Law Business Research Brands came together in April, May last year. And we've spent the last year really focusing on certainly integration internally and how do we bring the teams together. We now have a big new global, even more global than it already was. Um, content team that's covering so many different things and bringing new data sets and new perspectives into the mix. Uh, but we also really focused a lot on what do we need, how do we leverage the benefits of that merger for the benefit of our audiences, which is obviously the most important thing. So, um, we did finally rebrand after we no longer have to do alm, LBR for all of our emails and things and when we're presenting. So we are now Centellic. So um, you know, I know that'll, that'll take some getting used to in the market. The ALM and LBR brands have, have sunsetted. But the power behind them, all of the journalists and the market analysts and the teams that are driving them are all the same. And for many of us we're doing a lot of the same things. I think what you're going to see from us moving forward, if our mission is changing in any way, it's really just doubling and tripling down on where we think we were headed anyway, which is really being not just a media company that is telling you what happened or even why it matters, but really that strategic intelligence company that is getting more and more insightful in our analysis, more adding and investing in bringing on way more data, way more ways to look at that data, way more ways for you to interact with the human and, or data insights that we have. Um, so really just trying to. My goal is that our information is in the room with our subscribers, figuratively or well actually, but that we're in the room with them figuratively as they try to make really important decisions because we want the information to be that useful to them and so we'll always welcome feedback. Anybody listening? What else do you need? Let us know, we'll do even better.

Speaker E: So now that you're part of a kind of a UK led intelligence company, um, it's kind of, I don't know, it's just uh, as a result of all the American firms, now really pretty substantial firms in London. Is that kind of ironic, weird that um, um, you're kind of owned by a British company and yet all the American firms are really entrenched in the London marketplace?

Speaker B: I hadn't really thought about it. There's a lot of weird things about UK and British in terms of including the Fact that we apparently don't even speak the same language. And we are educating each other constantly on what words mean. And so there's all sorts of weird things. I mean, and listen, I think I don't even know if we would tell you we're a UK based or UK owned company. We really do view ourselves as global and in fact have a big focus on the US Moving forward. But it really is covering these markets globally. Um, and I think there's a strong understanding across the organization that we're going to be where, um, our subscribers need us to be to get the right information out to them.

Speaker C: Important to remember, Howard, we were a global newsroom before this merger, right. And we were all working with a lot of really talented journalists, uh, in different global markets. Well before this happened and when the merger was announced, one of the things that we heard from leadership was just sort of culturally how aligned both organizations are. And that's the kind of thing you expect to hear because as you pointed out, Gina, we've, we've all covered enough law firm combinations to know that's kind of just one of the talking points, but one of the kind of validating, rewarding, et cetera aspects of the integration has been getting to know those professionals and those colleagues and how quickly we've kind of come to a place where, uh, we've been able to collaborate and work together effectively. Because, yeah, it wasn't a lie. Uh, there are a lot of people there who, like Gina myself, have been with the organization for a long time, care a lot about what they do have developed in their careers, uh, within the organization. Uh, so in some ways it, yeah, it does feel a little bit like looking in a mirror. And the bigger challenge is just kind of finding the folks you need to get to know. But once you do, it gets a lot easier because everybody's kind of viewing the mission in the same way. That, and how to spell words and whether to put the comma F, Z,

Speaker E: not an S, always a Z. Always a Z. That's right. Do you guys have a, uh, greater appreciation for the merger process now kind of going through one as opposed to reporting and commenting on them?

Speaker B: Appreciation is an interesting word. Definitely understand it a lot better. And I do have. Yes. And I think that's the interesting. Going back to my point about our business evolving along with the firms and um, particularly my role, I've had a bit more of a lens into the business side of things. And it really has helped inform how I view what law firms are doing, what corporate legal departments are doing. And, um, having that added understanding I do think is helpful.

Speaker C: Right.

Speaker B: I mean, I haven't worked in a law firm ever. Um, have nightmares about doing so, to be totally honest with you. But it does give you that perspective from a business sense. And we are business journalists. So to have that, that added perspective, I think has helped me certainly.

Speaker C: I mean, Chris, one of the things you asked about in your first question was just sort of how far we've come or how we've evolved. And we're trying to move very quickly. We're trying to transform in a lot of different ways. But sometimes when I can steal a minute or two just to think back. Yeah, we have transformed a lot. I mean, when I started, and I think, Gina, you too. Um, you know, it was as a reporter for a specific regional publication, and that publication had digital content, but it was very print centric. Um, you know, we were siloed. Um, you know, every publication kind of had an editorial structure. And you know, it's. It's crazy just to think, you know, how much the newsroom, how much the organizational structure, how much our workflows, how much our collaborative processes have changed over time. Um, yeah, integrating is tough. Um, there's a lot of challenges to it. Um, and it's different, I guess, from what we've gone through before, even for folks like us who've been around for, uh, a minute, as the kids say. But, um, we know we've kind of had to evolve and transform in the past, so that's informing some of what we're going through right now, which is a positive.

Speaker D: So I'm half curious. Um, Howard brought up a key point around merger and merger experience and you guys getting exposed to that and change. I'm curious, from the business side, where are the synergies in this and how is that going to play out in this potential new business plan? I know you guys just met with leadership and you had a leadership meeting. Um, is there anything going to change for the, uh, audience of law.com and, um, what does the UK side, if you may bring and. Or is it business as usual because you guys are best practices.

Speaker B: Hmm, interesting. Yeah, I mean, in some respects it's business as usual because what. And maybe it's why the integration has gone so well because there wasn't a ton of overlap that we had to fight through. It really was very complementary on both sides. So it kind of added strength to either side where it really needed it, whether it be a business and practice of law mix, a corporate and law firm mix A global and US centric mix that kind of filled out spots, um, in all of those areas. But I think for me, what I'm most excited about and what I keep really pressing all of our teams and business units on is love that we're investing in getting new stuff, love that we are really doubling down on what works well, but the ability to really think critically about what are the data sets or the human insights that we have across the business, even if not in a traditional, um, specialism. But what can we draw from other specialisms that we've added and pair with other data sets to going to say this the most cliche thing, like one plus one equals three. That's what I'm most excited about, about the integration is really tapping into the full breadth of what Sentellic now has to offer. And it's not about, for me even what product or platform it lives on. It's. Let's just find the best content, the most insights, and I'll serve it up wherever you are. Right. We want to meet you where you are and get the information. Because there's different legacy readers of different platforms are going to have interest across both. So how do we just make sure they're getting what they need, where they are?

Speaker D: It's interesting. So in essence with the union, are we going to be pulled into more of the news of the UK and vice versa? I mean, is there going to be just a broader sharing of stories and a tying in of this cross the pond, cross border, uh, story that continues to weave?

Speaker B: Yeah, I mean, I think relevancy is always going to matter. Right. I don't want to bombard somebody with types of information that they just don't have an interest in. So we're still going to be a bit thoughtful as to where certain content is shared, how much content is shared for that reason. But we also, as I think most businesses in our space are doing, are really focusing on personalization. Right. So you can go in and decide what of this mix you want to receive and have that directly fed to you, or have the website show up to that. Or as many people are, we're working diligently on MCP access, uh, and bringing our content and information directly to our users to use in their own ecosystems, which is a whole new world that, um, information services companies need to be thinking about and where do we need to integrate. So we care just as much about what's happening in the legal tech space as we do in writing about it. Right. It's all relevant.

Speaker E: Gina and Dave, if I pivot to the land of law firms for a second. So between the two of you, uh, you've probably sat across from more chairs and managing partners than Chris and I ever will. Um, so after all that access, uh, what does the legal industry still manage to hide from you, and what do you think is hiding from itself, basically?

Speaker C: That's a great question.

Speaker B: Such a good question. I'd love to be able to say nothing. But we know that

Speaker E: well.

Speaker C: So I think it's strange to give this answer just based on how much reporting, and I think good reporting that we've done on this, but the intricacy and innovation and evolution within law firm compensation models, particularly specifically partner compensation models, and how much that has moved from a world of pure lockstep to modified lockstep to super points and shares. And anytime I have the opportunity to have a conversation with a law firm leader, could be, often it's a very large firm, but sometimes, maybe it's not. Uh, anytime that leader is willing to talk about their partner compensation system, I feel like I learned something that I didn't know before. I learn about, even if it's just some small feature or element of, uh, how they do it or their governance model, or it could have to do with their retirement policy or the equitization policy, or it could be how they redistribute shares based on performance, or it could be that they're willing to. They're willing to undergo shifts to the valuation of individual shares, or do they want to keep that share value constant and redistribute the shares? So I'm talking minutiae, I'm talking nuts and bolts here, but really, when we're able to surface, uh, at least some of this for our audience, I think that we're really doing our jobs the best we can, and we're giving them value and being able to benchmark. Okay, well, how do we. How do we compare, uh, to the market? So I think there's a lot of variance there in partner compensation, a lot of which we've been fortunate enough to be able to surface. But I think there's a lot more below the surface. So we're going to continue to plumb those depths. That's one thing that springs to mind. Um, it also feels funny to give this example, but I think the world of Gen AI, so I do think I'm this week at least thinking of firms in kind of two big buckets. One's where there's a lot more than meets the eye, and firms where there's maybe not quite as much as meets the eye. What do I mean by that? I mean, there are firms out there that in terms of how they're staffing this, how they're staffing the technological revolution, if you will, in terms of bringing on engineers and data scientists, or they're equipping their attorneys with different tools, or starting to weave these tools into workflows or partnering with different platforms, um, we'll hear about that and find that maybe the firm isn't really ready to talk about it yet. Clearly, um, it has become very much a. A PR play. How a firm writ large is doing AI in big quote marks is very much something that they want, a message deliberately, and they realize how competitive it is. They realize how fast moving this world is, and they realize that they have to hit the mark. Not only that, but they want it to be viewed and understood accurately, but also kind of in the ways that they prefer. So I think there are firms out there that are doing remarkable things. And for as much as law firms love to tell us, hey, we're doing remarkable things with AI, um, they may not be ready. So I think there are firms out there where there's a little more below the surface. And just like with any kind of wave, I mean, Gina and I, we've been through the trends with. All right, everyone has a cybersecurity practice now. Everyone has a cannabis practice now. And part of the job of the journalist is to have a sense, not because you want to rank or rate them, but have a sense of which firms are actually building expertise in this area, are actually ahead of curve in this area, or are just kind of putting on their website. Because you can't not put it on your website at this point. I think there's an element of that too. So we have heard from firms, again, of various sizes that, um, they don't have a great handle on the utilization of the various tools that they're outfitting their attorneys with, or they don't have a great sense of what the use cases are. Or maybe they're handing their attorneys lots of tools and they're not giving them enough guidance on how they might be used or how they should be evaluating and experimenting with them so that eventually they can be part of the client, uh, service delivery model. Um, so anyway, just the, uh, variance in where firms are on their AI timeline, the posture they're taking, the different ways in which they want to harness that power, is pretty interesting. And a lot of it, there's still a lot of it to be surfaced

Speaker B: I would just add to that because part of your question, I think, Howard, was what are they hiding from themselves? Um, which I find really interesting. And so of course I'll go on to that part. I mean, in some respects it's not hiding from themselves. I think there's a lot of more sophisticated ways that we can start looking at the data at our disposal. And that's not just on the law firms to figure out, that's on us to figure out in terms of how can we think new ways about our data and serve it up to them. And I, you know, I think we can do this in partnership. What do they need? What can they, what can they do? We have some sense of ways to look at data. I'm sure they are looking at it in unique ways that I'd love to learn about, but in terms of kind of hiding from themselves. And this is not a blame thing because I think, and we use this analogy in our own business, but we're running, we're driving 100 miles an hour down the road while also trying to change the tires in that we're implementing this new technology. We want to move fast. Clients are demanding it. Um, but I think what's not happening as much as maybe I would hope, and maybe this is something that we just don't know about. So giving that because I know there's a ton of work on AI, a ton of work on innovation happening in law firms, a ton of, um, more sophisticated things happening. But how much is it truly impacting the business model of these firms? Are they really looking at that? Are they assessing where things need to change in meaningful ways? Structurally? Um, pricing, staffing, hiring. I mean, they're still hiring the biggest class sizes they've ever had. And they tell us, it's like, well, because Q1 was so good with demand, the old model is working. Why would we want to mess with that right now? Even if something's coming down the pike in a couple of years? So, um, I do want, I have to imagine they're spending time thinking about how this impacts their business model. But some of the comments I hear from managing partners are like, I would have thought it would have had a bigger effect already. I don't know. And these are firms that are investing in this stuff. So it's like, oh, no, don't backtrack.

Speaker E: So one quick follow up question, Gina, you mentioned kind of data. I'm curious to get your views on if the, the business model relating to talent, because the fluidity of partner talent across the Amwa 200 is just ferocious. It's like white hot. Um, is that going to affect ultimately the business model of these law firms, do you think?

Speaker B: I mean, Dave, you can talk about this more than I can. I mean, I think if you look at the private equity investment conversations that are happening, and Chris, you know this in our two more than anybody. Um, I mean by all accounts it's going to happen. It's happening in certain pockets of the industry already certainly, but in this big loss space where we're talking about, it's going to happen. And I mean, I think aside from tech investment, the biggest reason for that and maybe even the main reason that these firms are looking at it is to help create long term incentive compensation plans for their partners to avoid some of this craziness and or continue it by attracting people. Um, so I think, yeah, it is. I can't decide if it's what's changing the industry fastest or what is keeping it the same. The fastest, if that makes sense.

Speaker C: Yeah, I would only add to that. Yeah, I think that makes a lot of sense. And that's part that resonates with me. Um, I guess something we kind of learned every so often we look at the, the law firm business model, the partnership model, and we kind of turn it over and we inspect it and we say, God, isn't this just wild that these are full distribution business models and they zero out every year and how much money they're making and how they're distributing it. And then the evolution of partner comp models that I was talking about a moment ago, um, it's just kind of a wild business structure. Um, and yeah, as has been pointed out many times and we've talked about it, Howard and Chris, it's never been a model that necessarily incentivizes long term investment. I think if there's one thing we learned in going back through that process of just inspecting a new, the partnership business model, a lot of that happened during uh, the sort of early to mid part of last year, uh, when uh, there were executive orders coming from the White House, uh, directed at law firms. And we were kind of realizing all over again a certain kind of disruption has the potential to really damage a law firm. Is this an existential crisis? And in so doing you get to the point where you're looking at that model all over again. And one of the things you realize is if at law firm A, B or C, if something really scares the partners enough, whether it's an executive order or whether it's how AI is going to Disrupt business models or whether it's private capital entering the equation or whatever it may be, there's really not much to stop them from walking out the door and from bringing business with them. Um, so the part that resonates for me about the potential for private capital being injected into big law proper, we've seen for personal injury firms and plain of sight firms. That's a little bit more of a ready entry. Right. There was like, I think a firm in Atlanta recently that uh, went public with taking investment, Morgan and Morgan, which if you've ever driven up or down, even if you've only driven up down the Jersey Turnpike, ridden the subway, you know, Morgan is. We certainly know them since well before they were on the turnpike or in the subway. You know, when it becomes public that they're uh, experimenting with it, that makes, that makes a big splash. But getting into big law proper, that's, you know, kind of one of the, one of the justifications for it, if you will, that I think makes sense to us because talent management retention is really hard in a partnership model. And if this is a key to solving that, then I think people will listen.

Speaker D: Yeah. So in part of our preparation today, um, you both shared a little bit about, um, a process that Gina, I'd love for you to kind of describe. Mapping out the Future. Was it 2040? Is that you were looking at? And I know you can't go into great detail, but kind of the main factors impacting the future of law, um, with what you're allowed to share, we'd love to use that as kind of a springboard into these topics.

Speaker B: Certainly. No, it's been so fascinating. So let me be the first to say I went into this a bit skeptical in that while I am often very academic in my thinking, and I like to kind of philosophize and see where threads might go, I'm always a little skeptical of these processes of like, what could happen in the future and so far in advance, people. But I am like totally bought in now. And I have found this process fascinating. So happy to talk about it. So it's, um, this pathways program that law.com um, in partnership with TLTF Fund

Speaker D: and Summit, um, which is the Legal Tech Fund, correct?

Speaker B: Yes. Forgive me. And Harvey, we, um, are doing this really intensive research. Almost seems unfair because it has such real world applications. And that's the part that I've been so happy to uncover where we are bringing in general counsel, law firm leaders, um, legal technologists from across the profession. And we have spent three months Together in intensive workshops, really digging into what are kind of the truths that exist right now that are already, we're seeing, shaping the shift in the industry. Things that we know are going to change because they are and they're on that path. What may happen, what are the key factors that could impact how that shifts out so that if the market is disrupted as much as some folks predict it could be by say, 2040, are there signposts along the way that make that feel more familiar and less shocking so that you can identify them and respond to them and perhaps even try to change the trajectory and, or position yourself well to live in that one of many outcomes? So we have multiple scenarios that could exist that we have mapped out through this intensive research. They will be revealed at the TLTF summit in November. So I can't say too much about that part now. Um, but what we're really looking at is, um, how. So what are the three main things that could impact the polarity of where they could go? Right, so it's the tech element, right? How much do we trust in tech or not allow tech to really rule on certain areas of the law versus the human? How do we. Is it an integrated consolidated tech stack, or is it a fragmented world where there's no clear owner and the data could be everywhere? Then there's the governance, which is tied to that. Right. How much will this guild allow itself to, um, not be as self regulated as it is or allow other entrants in? How much will people accept the tech? And that really in my mind comes down to the general counsel and client buying behavior too. I think they have a big role and I want to come back to that in a second. Then the third piece, um, well, that is kind of the third piece is the people. It's the governance, the tech and the people. What will we allow? Depending on how far you go, are we human led or algorithmic led, or you know, are we consolidated or fragmented? Who kind of wins the tech game? Is it a law firm world? Is it a general counsel world? Legal technologists reign supreme. These new hybrids, all the things are being discussed and paired in really interesting ways. Um, but it, you know, the client buying behavior I keep coming back to because there's been so many instances in just my time covering the profession and I'm sure before, where logical outcomes where you would think that clients could drive the most change in the industry because they are the buyer, they are the client, uh, it doesn't always pan out that way. It does feel like here, because of Pressure from the broader business that GCs are facing and other things that the client is really going to be on the forefront of pushing this. And it's like, which providers are they going to lean toward? Are they going to go to those alternative providers or not? Um, and, you know, we had the same discussion with the advent of LSPs in the wake of the financial crisis. We've had it with the ediscovery. These are the same scenarios, same kind of disruption patterns, just different set of facts. Um, but this world feels different and it could play out in a lot of different ways, all of which we will be outlining in fun. Um, it'll be fun at the summit, actually. I think we're going to put on a little show. Um, but it's. It's just so neat to think about. Okay, so what do I do about that? If I want this, how do I make it happen? If I don't want this, what do I do if this is going to be it? No matter what, how do I survive? So it's been cool to give people that agency. Um, but the most interesting thing for me perhaps, is we come up with these wild headlines from 2040 that. The most ridiculous things that, if I said it right now, you would think, oh, that's never going to happen. And then you look at all of the things that are happening right now. The headlines that we're writing today that fully support that outcome, it's not as far off as you might think. So it's been fun. Thanks for humoring me on that.

Speaker D: Absolutely. Well, along with those lines, we're going to play a little game, uh, that might be a little bit of an example of that, um, and would love to hear. And Howard, you're welcome to opine. We can kind of do this all together. Um, but maybe by 2040, are we going to have publicly traded law firms,

Speaker B: Dave?

Speaker C: Um, well, I mean, look, There's already kind of chatter about that, right? So does a firm erect an MSO management services organization in order to accept private capital, but also so that. That MSO might someday go through an ipo? A lot of acronyms here, right? Um. Uh, could the. I don't know, could the regulatory model just. Given the market forces at work and the kind of dynamics we're talking about, could the regulatory model change to where, um, maybe you don't even need that anymore. Right. Um. These are things that are hard to imagine right now, but just the fact that we're whispering about, we see unfolding. I can remember, Chris, when we first Had a conversation probably only, I don't know, maybe a little more than a year ago. Um, and we talked about some of these things. And around that time, I remember Gina and I, we had lunch with a couple folks who were kind of in the same orbit, who are a little bit of, uh, in the in between world, between potential investors and law firms. And they're, you know, they're, they're saying similar things and kind of adding to the picture and just, you know, at that point you start asking around and we have our journalists asking around, and you start to real, really see a picture, a mosaic of what's happening. And again, some of it below the surface, but some of it happening here. So there's just this, um, there's kind of a dual narrative right now around outside investment in law firms. On the one side, you have a lot of large firm leaders, whether it's gamesmanship or whether they're truly befuddled or maybe a bit of both, saying, I don't get it. I got called in to listen to a pitch and I thought it was one thing, and then it turns out it was this, and this is ridiculous, and my partners never go for it, and this is a stupid story. You should stop writing about it. Um, but we also know from talking to folks like you and many others in the field that, um, there's movement happening. Right? It may not happen all at once, but if you're going to, you know, if you're going to tunnel through the Rockies to build the intercontinental railroad, sometimes you're going to go 6 or 12 inches, uh, a day, but you're going to get there. So that narrative has a whole field of inevitability to this, to where, um, I won't go so far as to predict it because I'm not a comfortable prediction maker. But I wouldn't be surprised if by 2040, we have some publicly created law firms out there.

Speaker B: All right, I'll be the predictor only because I'm going to treat this as like a little time capsule. And in 2040 we can listen and see. Like, I'm just guessing. Let's see if it's right. Uh, I'll say yes. But I think, Dave, you brought up a really interesting point that just is general to business and particularly right now, which is we might so surpass the hot Topic now that it becomes irrelevant. Right. So what could happen that would make it like maybe, yes, a five year issue, but in 15 years we're so far beyond that. And do you want to just circumvent it all together as a result of predicting out those things I think are

Speaker E: interesting and I would say probably, uh, the answer is maybe yes, Chris, but I think, uh, the three other ingredients are going to be fascinating to watch. And I think that's rule 5.4. Because the regulators are hanging in by their fingernails. They don't want to relinquish that. And obviously, uh, the whole idea that lawyers have no non competes in the one industry where they are dominant, no other profession works like that, then obviously you've got privilege. And so that's a monopoly position. So it's an interesting series to kind of get to an IPO land. It would be fascinating to watch out for.

Speaker C: Great.

Speaker D: So I'm not done. Uh, are we going to see, um, some of the largest accounting firms join forces with AmLaw100, AmLaw50, ah, law firms, maybe a Swiss Varian that's consolidating join forces, um, or combine with some of the major consulting firms that are being hit very hard by the LLMs that are about to go public.

Speaker B: My gut is that I, maybe I just haven't been thinking about this closely enough. I mean, I definitely think we do see accounting firms getting more and more into legal where they can and want to, but not at the scale of the Amol M50 realm. I think we're more likely to see a large law firm and a large legal tech company combined than an accounting firm and a law firm.

Speaker C: I would say if as you allude to Howard, the uh, ABA ethics rule, uh, were to go away or be fundamentally changed, um, then yes, it may not be a top of the Amlon M100 firm, but I think, I think somebody would do it and see it as a viable, um, service delivery model. There's some current against that. There's a piece of legislation in California now. So I think you do have, even if it's not the aba, you do have regulators waking up and saying, hey, wait a minute, I don't know if we're cool with this. Whether that's enough to stem the tide, I don't know. But if ethics rules writ large were to change, someone would give that a try to really go full service in big quote marks and mean it.

Speaker E: Yeah, I think maybe if you asked me that two, three, four years ago, I probably would have said yes. I think now I think I'm in the Gina camp around that technology is such a game changer. Where law firms are now hiring data scientists to work alongside, um, very powerful lawyers. I think that's a game changer. And you're dealing with very intellectually gifted people inside of a law firm. They will figure this thing out eventually. Um, so, uh, my money's on the law firm side.

Speaker D: Another question, throwing this out, um, because of the application of AI and likely need for capital, whether it's internally generated from distributions or retained earnings or private capital. Coming into the picture, do you guys feel that the AI is going to create more demand for law firm revenue? Law firm need, or is it going to reduce demand and we're going to feel that contraction?

Speaker B: So, yeah, that's a great question. Um, can I say both? That's such a lawyer answer. And I'm not a lawyer. So the. I think there is definitely a school of thought and I think there's accuracy to it. That AI is just going to speed up the pace with which business can get done and therefore the need for legal support to execute on that business. I think, though, the way the amount of people involved or the way that it gets done, um, it may not require the same level of support from a traditional law firm under its traditional model. Um, so I think that will be interesting. I ask managing partners about this all the time. You're hiring so much. It seems like it would be a great thing. AI can take away the work that the associates had to drudge through, but if their hours requirements are the same under the same model, and what are you going to do that's just causing them extra stress and strain on your business? They'll just fill it with more work. Just like we found more work when eDiscovery came, just like we found more work when email came. Just like what? That's the school of thought that I think some of the firm leaderships are thinking. But I think the general thought is that demand is not going to dry up. I don't know if that's right or wrong.

Speaker C: Yeah, I'll give another lawyer answer. It depends. It depends very much on the client, the service being delivered, and that's going to vary a lot, uh, firm to firm. I have heard it said, the optimistic view is this, and I have heard it said that I don't want to turn this into a billable hour conversation, but tasks are still managed to time. Time is a function of everything that gets done at a law firm. And to the extent that can be transformed, to the extent that can change, um, I've heard it said that you really have no idea how much legal work isn't getting done because everyone's managing to time. So if we're able to tap into that if we're able to kind of unleash that via technology, that would say that demand isn't going to go anywhere and may in fact accelerate.

Speaker D: So one of my last questions, or my last question I should say is knowing the American lawyer, uh, reports the AmLaw100, the AmLaw200, your guys ability to and have for a couple of decades now collect data that's been through voluntary submission and some are players, some are holdouts and won't share everything. What's the one thing you wish they would report on that you guys have not asked for? Or something that would be really helpful for not just yourselves and maybe the public, but for them too. What are they holding out? Or if you guys were to ask if it was for some reason mandatory that they would share, what would that be?

Speaker B: Sorry, I'm just running down the list in my head. Like what would I put first, Dave? I don't know. I mean we've added in a number of new questions to try to get more granular as it relates to particularly partner comp. Because we want to give the market a fair assessment of what's really happening at the different levels, even within a single firm. Right. Because averages do not tell the full story. So the more nuance that we can get, you know, it's not just for our interest, it's because, you know, we, we want to give a full picture to potential talent, to firms to benchmark against, um, to really explain kind of how the compensations work. But I mean I know that's in part the secret sauce. So I'd also love to know how they are not just spending on AI but uh, are they charged? You know, they want to charge the clients for it. The clients don't want to be charged for it. How are they, how are they handling that cost? Is it a sunk cost? Is it something they're trying to get a return on? Where does that all play out?

Speaker C: Yeah, I'm going to totally steal uh, your answer, Gina. But um, I think, you know, as we talked about a while back, just how much partner compared to models have changed, um, any way we can measure it differently is helpful and we have added questions to that effect and many have given us data more than maybe we would have guessed at the beginning. Um, and we've been able to now have a couple years worth of it and start to cross index it a bit and see what's happening and giving a real picture about how big is the compensation spread firm to firm and across the industry on AI. Yeah, I guess this would be hard to survey for. But again, I would love to be able to give the audience, to give the industry a clearer picture, um, clearer abilities to benchmark where they are, how they're using technology, how they're integrating it and it's not linear. So I don't think firms are probably thinking of it right when they're thinking of being ahead or being behind. But where are we in our timeline and how does that timeline compare to the industry? I would love for firms to be compelled to answer, um, some more of those questions and I'll throw one in because I just stole two things from Gina basically. But uh, we haven't really talked much about consolidation. But um, obviously we've seen a ton of it in the industry. It's going to continue. We've seen a lot of stratification. Um, we realize law firm combinations, they're not the right thing until they are. So we realize a lot of firm leaders, um, they're honest when they say, well, we're not doing anything until, until it's happening. Um, but uh, we're always chasing down the next thing and would love to have a half step head start on that. So if we could get law firm leaders to be more honest about what they're actually doing in that regard, I'd love it.

Speaker B: Somewhat tied to that. The other thing that I would say we are doing and are actually getting great and increasing reception from this segment of the market on is um, mid sized firm data, um, really seeing a lot more of that. And I think it's a benefit to the full industry themselves to provide benchmark but also to potential acquisition, not targets, but those that are looking to acquire them. So it's something that we would like to see that data go further down market and it's starting to happen.

Speaker E: Last question for me is that um, when the both of you are not filing a story or running an editorial, um, what are you guys passionate about outside of work?

Speaker C: Family.

Speaker B: You can't say cutting your lawn. I know it's not.

Speaker C: I do love to tend to my tenth of an acre. Uh, it really is cathartic. Um, now family, look, I know it's an easy answer, but Gene and I, our kids are kind of a similar age. They're old enough to be independent to a certain degree, but they're also young enough to need you. So between the sports and just the needing you, um, it really is the best thing. Um, so family, uh, have a great community we live in. So, um, doing that and I am a little bit of a Sports, uh, junkie. So I feel like that's a, um, total waste of time. Sometimes I'm sitting there watching a game, thinking I could be doing so many other things.

Speaker B: Um, the Knicks delivered.

Speaker C: The Knicks delivered. No, the moments like that we live for. But when you think about all, you start adding up all the hours you spend watching these teams going, what am doing? I. What am I doing with my life?

Speaker B: So move to Philly, and then you'll really understand what you feel like.

Speaker C: It is a diversion.

Speaker B: Same as Dave. I have three little ones, and they keep me busy with all of their activities. But it's been fun to make them my activities. And if not that, uh, antiquing I love. We try to be very forward looking in our jobs, but I like to look back when I'm off the clock.

Speaker E: Very cool.

Speaker B: And I did start taking a hip hop class, an adult hip hop class, which is comical. Like, if anybody wanted a good laugh, you should try to come and peer through the window. And we're there. But I'm trying. Trying to be not just, uh, you know, focused on Little League and other stuff like that.

Speaker E: Fantastic.

Speaker D: So, Gina and David, it's been an honor and a pleasure having you both on the show at the same time. Thank you.

Speaker B: It's been so fun. Thank you, guys. It's great to catch up with you always.

Speaker C: Thanks so much for having us. Appreciate it.

Speaker E: Thank you.