AI-Native Firms Are Luring Frustrated Lawyers Away From Big Law

BloombergLaw [no paywall]: “AI-native firms may not be taking Big Law’s market share, but they are making incursions into a valuable asset: talent. “The AI-forward attorneys are chafing at the slow pace of firm adoption and archaic thinking,” said Sam Shaddox, 38, a co-founder of Seattle’s Talairis Law Group. “They’re migrating to the firms that are leading the way on AI, or leaving Big Law entirely to chart their own path.” Shaddox and Matt Souza met at the University of Washington School of Law, cut their teeth at Perkins Coie, and spent years inside legal departments of Seattle-area tech companies. In May, they launched Talairis Law Group to advise startups with the help of AI agents. The number of law firms branded as “AI-native” or “AI-powered” is growing quickly, backed by millions in venture capital. Many of their leaders left major law firms early in their careers to launch businesses aimed at young companies and entrepreneurs. Logan Brown, a 30-year-old Harvard graduate and former Cooley LLP associate, officially launched Soxton AI in New York in December. JP Mohler, 36, was an associate at WilmerHale and Cooley after Harvard Law School and tinkered with AI tools at Casetext and Reuters before forming General Legal through Y Combinator with two co-founders. Some Big Law veterans are also heeding the call. Norm Law appointed Mike Schmidtberger, the former Sidley Austin executive committee chair in January. Moritz, a San Francisco firm whose CEO and co-founder served as OpenAI counsel, has hired attorneys from Cooley, Goodwin Procter, and Fenwick & West. General Legal’s 14 full-time lawyers are almost entirely Big Law alumni. They were recruited in part because mid-level associates are “frustrated” by a partnership track that offers little control and years of deferred reward, Mohler said. All full-time lawyers receive equity in the company, which provides flat-fee contract and employment law services. General Legal has raised $11.5 million and reached $2 million in annualized revenue, Mohler said. That’s a speck of what large firms see in revenue each year and less than one-fifth of what the average Kirkland & Ellis partner earns in annual profits. Still, Mohler has lofty goals. “Ten years, it will be the biggest law firm in the world,” he said. Change will unfold “a lot faster than any previous kind of disruptive cycle.” He says he is aiming for “venture capital scale”—meaning a company ultimately valued between $10 billion to $100 billion…” AI-native law firms like Soxton and Talairis are built around artificial intelligence from the ground up—every workflow, pricing model, and staffing decision is designed assuming AI does the first pass of the work…”

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