Do you know your cash-burn phase from your TLDNR? Welcome to the buccaneering, hierarchy-lite world of the fast-growth, tech-driven ‘disruptors’, the kind of business that a growing number of lawyers aspire to work in or advise.
Following on from the launch earlier this year of the 2017 GC Powerlist, which focused on early-stage companies and rising stars at major plcs, we teamed up with DLA Piper to assemble an audience of more than 70 in-house counsel at London’s private members’ club Home House for an informal discussion from the lawyers working at the digital coal-face. The debate covered the launch of the much-touted Disruptive GC group, the challenges of working with impatient entrepreneurs and how lawyers can slot into the culture of a constantly-evolving company.
Alex Novarese: One of the things that we are looking at is the launch of the Disruptive GC group. We have several members on the panel. I am going to ask Lisa to give us some background.
Lisa Gan Tomlins, Made.com: I describe it as group therapy for me. I had been in private practice for ten years, in two large American law firms. I then moved to another disruptive company of sorts called Just Eat. That was already slightly traumatic, in that it was a move from a huge network of partners, lawyers, paralegals and secretaries to rely on to being in a six-man legal team.
From there I moved to Made.com two and a half years ago, as their first and only lawyer. It was a pretty exciting but also a very lonely existence. Very challenging. I could talk to myself in my own head about things. I would sometimes randomly call people I used to work with. There are only so many times you can do that before you get a bill.
Alex Novarese: You have to develop a rota.
Lisa Gan Tomlins: You do. That was the genesis of it. I decided early on that it would be really helpful to have a network of lawyers. What I realised was, when I went to groups like this, conferences or law firm events, and met someone in a similar situation, who has a small team in a start-up that is venture capitalist-backed, there was a commonality of challenges. I was also into branding. Branding is key, particularly in any kind of tech start-up or disruptive business.
Simon Levine, DLA Piper: When I saw the launch of the network, I wondered whether it was GCs of disruptive businesses or whether you want to be disruptive GCs.
Lisa Gan Tomlins: A little of both. There was a play on words. The companies that we work for are disruptive, but to be successful as a lawyer in those businesses, you have to be a bit disruptive in challenging the assumptions about what lawyers are, such as that they are boring and say no. The original founders of the business I work for are younger than I am and have never worked in a big organisation. The way they approach issues and the way they manage teams is very different from more established organisations.
Alex Novarese: What sort of issues do you find you are addressing that would be very different to those that a lawyer in a large plc would face?
Karen Kerrigan, Seedrs: The point that Lisa raised about dealing with the founders and entrepreneurs is a really big one. The personalities you are dealing with on a daily basis can be emotional. They are younger than you and have sometimes never worked in a traditional business. You are not just a lawyer. You are a counsellor and that is pushed to the absolute fore.
My role is a little different to some of yours. We definitely are a financial technology organisation. Fintech recruited lawyers in an earlier stage. When I walked into the business there was a handful of us. There were five of us in the office and they thought they needed a lawyer. I took on finance, I took on HR, I took on compliance and, obviously, legal. Since the company has grown, that has not changed.
I came straight from Simmons & Simmons. You were in a place where someone did the printing for you. I walked into Seedrs and I was handed a box with my computer in. And I had to construct it. What I have become very used to in this role is, on a daily basis, trying to work out where my conflicts lie as a shareholder, as the legal adviser or as the FCA-authorised person that deals with compliance.
I thought I’d do it for a year and have loads of time to think about my business. I have never worked so hard in my life.
Karen Kerrigan – Seedrs
Alex Novarese: Were you aware of those kinds of challenges and that cultural shift from being in a large corporate law firm?
Karen Kerrigan: It was not as though I was looking to go in-house. I wanted to start my own business. I came across Seedrs because I was looking at funding options. I thought that I would do it for a year and have loads of time to think of my business idea. I have never worked so hard in my life. Four years on I am still there as chief legal officer. I did not anticipate it, but I certainly embraced it.
Simon Levine: Matt, Uber is often cited as a classic disruptor. It is becoming much bigger, multi-jurisdictional and more mainstream. You are going on that journey of being in a company that has gone from one end of the scale and is travelling up to the other end. Do all of these things still apply?
Matthew Wilson, Uber: It changes a bit. When I joined Uber in July 2015 we had a ramshackle office behind King’s Cross Station – 50 or 60 people. I was the first lawyer. On day one I had a queue of 15 people at my desk who said: ‘We have been waiting for you to arrive. Have you ever dealt with the police before?’
It was a really odd environment for a corporate commercial lawyer to be stepping into. At Uber, the whole spectrum of legal issues was on my plate by the end of day one. I started working through the list, trying to prioritise things and getting to know the people in the business. By the end of the first week I thought: ‘I have made it to the weekend. This is great!’ Saturday was just like a normal work day. That continued for a few months.
After a couple of months I had a good view of the business, had come to know people really well and had started to work out what kind of lawyers I needed to hire to scale both the team and the business in the UK. My remit at that point was the UK, Ireland and Scandinavia.
I started recruiting. I should credit the GC at Lloyds Bank for this, as it came up in a conversation that we had a few months ago. What I looked for was people with T-shaped experience. They may have the depth in litigation or antitrust, but they will roll their sleeves up, pick up whatever comes in through the door and do a 75-80% quality job on it.
Since then we have grown to a team of ten covering the UK and Ireland. It is a mixed bag of a couple of employment lawyers, a couple of litigators, three corporate commercial, a real estate lawyer who covers the whole of EMEA. You probably all know about the issues we face. They are plastered all over the papers every day. We need the lawyers to think in that roundabout way as well, and make sure that they are taking into account all of those different angles that might affect the future sustainability of the business.
On day one I had a queue of people at my desk who said: “We have been waiting for you to arrive. Have you ever dealt with the police before?”
Matthew Wilson – Uber
Alex Novarese: Amol, you work for a company with huge reach. Do you Barclays lawyers have that kind of flexibility?
Amol Prabhu, Barclays: It is something that we increasingly look for: being able to get involved and not being afraid of going out of your comfort zone by being involved in initiatives that can touch the whole bank. Being an in-house lawyer, even in a very big organisation, is a great opportunity. It is quite disruptive, in terms of there being so much going on, particularly in the financial services industry. That ranges from how we handle Brexit, to MiFID II and the structural reform programme.
The trusted-adviser concept is often rolled out. You rapidly realise that, even though there are 836 of us, you are in a huge organisation of around 120,000 people. The majority are non-lawyers and do not care much about lawyers. You have to be talking their language and, to a certain extent, playing to their rules. They may not be emotional, but they are certainly sometimes more aggressive, and you have to handle that.
Matthew Wilson: The point about a lot of them not really caring about the law is one of the big differences between the bigger plcs and corporates, and our companies. Pretty much everyone in the office down in Aldgate is really interested in what we do. With the stage that our companies are at, it is still pretty central.
Many of our staff are very young. They are very clever, but they are not particularly experienced. They would not know where to start when dealing with contracts. To be able to scale ourselves, it is important to educate them and almost turn them into junior lawyers themselves. We try to scale our teams without adding extra heads.
Karen Kerrigan: This is where this comes to a head, because all of our businesses are pushing the boundaries of the regulation. Crowdfunding had to have a whole new regulatory regime designed for it and we were at the forefront of that. Today I was at the British Bankers’ Association. Tomorrow I am at the FCA. A lot of my role is about lobbying for change or lobbying to inform the regulators about how things work. For every consultation we put in, which we do one of at least every month, we get input from everybody in the business.
Amol Prabhu: When you said they really do care, I would say that in my organisation it depends on who you are talking to. Due to the Senior Managers Regime, the senior managers really do have to care. It was a sea change of culture, such that some people who did not have much time for you now want you at every meeting and want your input on everything. In a way, that is a bit of a silver lining for legal, because of the notion of being at the table. The door is now wide open.
Alex Novarese: You have vetting procedures, for the Disruptive GC group. How does the procedure work?
Lisa Gan Tomlins: In the early days, it was word of mouth referral. As the group grew to a certain size, we instituted a more formal application. It is just a simple Google form, which asks you who you are, what company you work for, how long the company has been around and how big the team is. We then balance everything. It is a bit of a subjective exercise.
The mission is key. If you cannot deliver that you can’t get past the starting line.
Lisa Gan Tomlins – Made.com
Karen Kerrigan: A subjective exercise on objective criteria.
Matthew Wilson: It is things like: ‘Are you venture capitalist-backed? What is your remit geographically and in terms of subject matter? Are you the only lawyer or in a team of one to three?’ Frankly, I am going to be kicked out pretty soon. It is not often Uber gets any kind sympathy, so that was a nice attempt.
Going back to the point about GCs and plcs coming into this kind of group, there are some that are doing really innovative stuff. I have a good relationship with Ed Smith at O2 and Maaike [de Bie, GC] at Royal Mail. I have stolen lots of things from Ed, like making sure people in the team have one-to-one responsibilities and relationships with business sectors, and recruiting young lawyers and giving them broad responsibilities. Things Ed did five years ago work really well for us.
Alex Novarese: What advice would you give to lawyers joining fast-growth companies?
Matthew Wilson: You have to know who you are working with. My boss when I joined Uber was in San Francisco. How much did I speak to her in a week? About half an hour. The rest was up to me. Getting to know the main people you are going to be working with on the business and policy sides is really important. The second thing in your early days is that responsiveness and that willingness to not just be a lawyer, but to also be a business person and to get into the weeds of every aspect of a small, high-growth company.
If you are to be advising accurately, you have to take the right view on risk at every stage of the company’s development. The view of risk I took two years ago would be very different to the one I take now, because of the size of the company we are today.
Lisa Gan Tomlins: I love mnemonics and I love the rule of three, and I apply it at Made.com. I came up with the ABC of being a Disruptive GC. My ABC was strained, but bear with me. It is to Abbreviate, create a Brand and be Concrete. Abbreviating means that it is about being concise. No-one wants to spend thousands of pounds on a memo. My emails, even to the CEO or the board, are three paragraphs at a maximum, or three bullet points with headings.
Matthew Wilson: Do you think that is because you have developed that relationship of trust?
Lisa Gan Tomlins: A little bit. I have occasionally sent longer emails of things when I have thought that it was warranted, such as share options, and people have responded saying: ‘It is too long. I did not read it. Just tell me what I need to know!’ It is TLDNR: too long; did not read.
Simon Levine: How important is it to find young lawyers who are technologists as opposed to just lawyers?
Lisa Gan Tomlins: It is important to have lawyers who understand the technology, so they understand social media, SEO [search engine optimisation] marketing, the world of data and what is happening. Technology itself, in terms of using it in the businesses, is less important than you might think because a lot of the technology is still tailored towards the very big organisations.
Matthew Wilson: I am interested in knowing how many people’s teams in the room use functionality like shared documents as found in Google Docs. I started using Google Docs and it was revolutionary. It cut down review times and turnaround times on mark-ups and things like that by a huge amount. For those of you that do not know, it means that we can all be in the document at the same time. I thoroughly recommend it.
Alex Novarese: How good are large law firms at dealing with fast-growth companies?
Lisa Gan Tomlins: It varies a lot, even within a firm. Within a firm you will have some lawyers who are great at being nimble, concise and concrete. They will then introduce you to another partner and you think: ‘No way.’
I was going to add something about risk. Being a lawyer is about balancing risk against the benefit. One of the things that is common to a lot of early-stage disruptive businesses is that they are not profitable. However, they are trying to scale at a really rapid rate. That means that you have very little to lose and very little money to spend. In those circumstances, if you are being responsible, you cannot take certain types of risk. You have to do that balancing exercise, and say that it is very nuanced and that it would not be fair to not highlight the risk, because the consequences would be shareholder returns plunging. That changes the dynamic a lot in terms of what kind of risk is acceptable.
Simon Levine: Particularly in a smaller company that has started up and may go to initial public offering, are you thinking that you want to continue being a lawyer or about learning a lot of skills to become an entrepreneur?
Karen Kerrigan: Since I have been working for Seedrs I have found out that I like the law a lot more than I thought I did. It may just be the variety and the application of different skills, as well as getting a more holistic view of things. I would still like to found my own business at some point, but for the time being I have found that balance between the risk-taking, being an early joiner and being a shareholder, while not being totally by myself. I have learned a huge amount along the way. It has scratched the itch.
Alex Novarese: Amol, have you ever been tempted to cross the floor for a commercial role?
Amol Prabhu: It does pass one’s mind. We are increasingly doing a drive around the whole internal mobility concept. It is not just within the business, but obviously compliance and risk are sister areas. We have also had lawyers going into chief of staff roles. Again, there is a focus on what legal skills you have, and how those skills are transferable and deployable in other areas of the organisation. That is one of the great advantages of a huge firm. There is so much potential opportunity internally that you can grow your career. As you become more senior you end up being involved in projects that touch the entire plc. Brexit is a great example of such a huge project, though there are others.
There is so much potential opportunity internally that you can grow your career.
Amol Prabhu – Barclays
Simon Levine: I guess you discuss Brexit a lot in Barclays. I wonder whether the other businesses discuss Brexit.
Karen Kerrigan: We do. We have a MiFID passport, we are regulated by the UK and we take investment, and have three offices throughout Europe. The government and the press desperately want there to be a story about fintech dying because of Brexit. Ultimately, we will be on the coattails of whatever happens with the big financial services institutions. The difference is that we can leave that decision to much later.
Alex Novarese: Let us widen it out a little. It is a turbulent world and you are operating in fast-moving industries. What are the big-picture trends that you think in-house lawyers are not thinking about but should be in the next five to ten years?
Matthew Wilson: This is not trendy, but it is politics and regulation. What I have seen is a kind of entrenchment in regulation. It is moving to a position where it is more protectionist. There is more regulation of innovation rather than regulation of outcomes.
If, as a country, we want to embrace things like artificial intelligence and automation, and the benefits that they could bring to the economy and society, we need to guard against that prescriptive regulation. That worries me. I see the Finnish, Swedish and Estonian governments coming up with some open and liberal regulations, which welcome some of this technology. We need to be mindful that we are in competition with other countries.
Alex Novarese: We can take a couple of minutes’ worth of questions from the floor.
Martin Cook, Funding Circle: I work at Funding Circle. We are technology-enabled but mission-led. To what extent are you mission-led?
Lisa Gan Tomlins: It is absolutely key, because it is what distinguishes, and is the unique selling point for, many of our businesses. The technology is almost something that is taken for granted. Being able to deliver that mission and being the leader in delivering that mission, because often there will very quickly be copycats, is important as it is survival of the fittest. Everyone wants to be an entrepreneur now. Money is just flowing around. If you cannot deliver that then you cannot even get past the starting line.
Kelly Harris, Simply Business: We are an insurance tech disruptor. You have just described my life. It is great to hear you talk. I do not feel as lonely anymore. I wondered whether you had some comments on being a business leader rather than a legal leader.
Karen Kerrigan: You go from that environment, where you have to build your own career path, but it follows along the track, to a business like ours where you are so lean that people are so very important. Last year I was losing sleep because of a regulatory issue. This year, because my team has doubled in size, I am concerned about losing employees. That is what I am losing sleep over. I am spending a lot of time developing those employees. To the point that you raised about being mission-driven, that really feeds into how you develop your staff as well.
Alex Novarese: This is probably a good place to leave it. Thank you.
- Lisa Gan Tomlins General counsel, Made.com
- Karen Kerrigan Head of legal, Seedrs
- Amol Prabhu Head of emerging markets legal, EMEA, Barclays
- Matthew Wilson Acting EMEA legal head, Uber
- Alex Novarese Editor-in-chief, Legal Business and The In-House Lawyer
- Simon Levine Global co-chief executive, DLA Piper