Focus: Broadening services means more business?

More than a decade ago, François Sauvageau was practising law in Toronto. But, after studying how external pressures were impacting the legal industry, he decided it was time to shift gears.

In 2007, Sauvageau began the second stage of his career by starting his own practice.

He charged flat fees or worked on contingency, sharing the risk with the client. It worked.

Then he set his sights on the collections industry, which has been operating separately and apart from the legal industry.

With the purchase of the first of two collection agencies in 2009 and with the help of technology and a legal approach to that business, Sauvageau has set out to disrupt debt collection through CTL Law.

“Clients were not just looking for lawyers anymore, they were actually looking for someone who [was] bringing an added value to their business,” he says.

Sauvageau is one of a growing brand of lawyers who has looked beyond his traditional legal practice by offering additional services to expand his market.

Adding more than just a dash of entrepreneurial spirit to the legal profession is becoming an increasingly important approach, particularly for those just starting, says Ottawa-based consultant and legal market analyst Jordan Furlong.

He says law careers where a person works at the same firm for decades is becoming less common.

“The reason why entrepreneurialism is going to become so important [is] the infrastructure by which people enter the legal profession and find careers is starting to break down,” says Furlong.

“Many of them understand the initial course of their legal careers is really going to be up to them.

“They have to rely on themselves much more than lawyers of previous generations.”

Going to law school, finding an articling position, landing a summer job at a firm, becoming an associate and working toward becoming partner is the traditional route that Furlong sees “narrowing.”

New lawyers are going to have to find or create new ways to develop careers within the legal sector, says Furlong.

Chris Bentley, who heads up the Law Practice Program at Ryerson and the incubator Legal Innovation Zone, says young lawyers are being required to learn how to navigate a new marketplace.

“What lawyers are starting to do is to think about the customer not just as needing a legal service but as needing a solution or a wraparound service generally,” says Bentley.

So lawyers are finding ways to complement the legal services they provide and developing closer relationships.

Rajah Lehal is another lawyer who decided to break away from a traditional practice.

First, in 2009, he developed a fixed-fee, contract legal services provider called Cobalt Lawyers.

In 2012, he launched Clausehound, a digital tool that assists in contract drafting for businesses.

“I just saw an opportunity in technology to improve a couple [of] things.

“One was the way we trained young lawyers on how contracts mechanically worked, and two [was] how to educate those who are largely startup companies on how to understand the mechanics of legal documents,” says Lehal.

Clausehound is now being used at Ryerson’s Law Practice Program and the business has been located in space at the incubator LIZ and received support from Toronto-based innovation hub MaRS, where Lehal was connected with an angel investor.

While it is in use and available for purchase, Clausehound continues to undergo improvements.

More features are being added with a goal of providing more sophisticated functionality and there is expansion into more American states and the United Kingdom.

Lehal, a lawyer who concentrated on entrepreneurialism as a business student and worked in business prior to law, sees a shift in the legal market and possibly an oversupply of lawyers causing those within it to push the boundaries.

“These pressures could change the practice to require more entrepreneurialism,” says Lehal.

But the startups aren’t all technology based.

Toronto-based Kate Dewhirst says she identifies as an entrepreneur and enjoys her work in her self-named health law practice.

However, she says she sees other young lawyers working in firms where they feel confined to their desks by “golden handcuffs.”

As a result, she is developing a coaching business to help other lawyers to achieve more satisfaction from their practices.

“I already take an entrepreneurial lens to my practice and I want to show other lawyers how to do that, too,” says Dewhirst.

“If lawyers can look at their practices as businesses and how can you broaden your impact, it frees up lawyers to have more fun.”

Her approach involves breaking down time into components and examining the time spent and the impact the lawyer is having on the client and the world.

The idea is to broaden the range of services to create more income streams while providing a meaningful and fulfilling service.

Richard Brzakala, director of external legal service for CIBC’s legal department, regularly interacts with lawyers and law firms.

He sees that increased competition and the innovative approaches in the legal marketplace encroaching upon traditional approaches in law.

“Some of them are not going the traditional route.

They’re creating and they’re very innovative. They’re entrepreneurs.

They’re creating their own firms, their own approaches to how they want to deliver legal services,” says Brzakala.

“So I think it’s good for clients because you’re getting a lot of competitiveness in the marketplace and innovation in how legal services are being delivered. The old traditional model, I think it’s had its day. It’s just moving in a different direction.”

As a client of law firms, Brzakala is seeing young legal professional entrepreneurs recognizing how traditional legal services may improve.

Many are developing tools to automate processes that have traditionally consumed hours of lawyer time, he says. It was those technological advances that attracted Sauvageau to the collections business.

He saw very well-structured businesses using technology to zoom into issues and offer metrics on the process.

By adopting a technology-based analytical system, he says he can make decisions quickly on issues such as whether or not to litigate.

“I thought that was fantastic. There was nobody doing this yet in law,” says Sauvageau.

“We created the law firm that in a way is built on the model of a collection agency, not from the legal standpoint but from a business standpoint.

The model allows our firm to handle a very large amount of claims at the same time of a similar nature but with different facts.”

At CTL Law, technology is employed to prepare claims. Sauvageau says automation is used to distill facts, which are reviewed and receive approvals from lawyers, paralegals and clients.

There are also some automated documents such as default judgment applications.

The firm also seeks alternatives to litigation to avoid the high costs and the lengthy process involved in taking an issue to court.

So early resolutions are often sought through mediation, in the settlement conference stage or in discovery, he says.

“Clients are looking for added value and law firms are trying to deliver added value somehow,” says Sauvageau.

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