Legal Tech Needs To Change Now

LegalTechTalk: Met Gala Meets CES

Having nearly doubled in size, this year’s conference was more like an upscale Consumer Electronics Show in Las Vegas, with at least three free bars, featuring Aperol Spritzers, a winery tour, and a jungle themed bar that allowed attendees to have little umbrellas in their drinks. A robot rolled around the conference floor with snacks, there were poker tables to teach game theory, free 3D photographic head shots to enhance your personal marketing and a mountain of free hats, squeeze balls, shopping bags, and themed snacks that were handed out to anyone who was willing to have something with one of the tech companies’ logos on it. Young salespeople hawked their company’s wares with the hyperbole associated with a consumer business rather than selling business enterprise solutions.

There were nearly three hundred speakers, which meant that nearly every company attending or sponsoring an event was represented on one of the multiple stages on two floors of the conference center, and in a massive white tent outside, demonstrating the event had outgrown one of the largest meeting places in London. Bradley Collins, the charismatic founder of the event, announced that in 2027 the organization was adding an event in Miami, to focus more on the US legal tech market, which means that legal tech company nerds will have two “Met-Gala-goes-to-the-CES-Vegas” shows to party at next year.

But the entire well-executed event was like watching people dancing on the deck of the Titanic. The conference is a beautiful ship, and the music is pitch-perfect, but below the surface lie ice cold challenges.

The Titantic Needs to Maneuver

There are at least two icebergs facing most legal technology companies and most of the 5900 people at the conference. One that they may be able to navigate around if they change now, and a second, more existential threat, that might change who attends such conferences in the future. Ironically, the legal tech firms that navigate through the first of potentially catastrophic icebergs by making changes now, may be those who avoid the big one looming on the horizon.

In summary: most legal tech companies are not positioned to appeal to the actual decision makers and most legal tech companies could be put out of business by the hyperscale foundational players as they come into this market. For nearly all the legal tech companies, their private equity backers, and the ecosystem of legal innovation personnel, the water they are swimming in is about to get iceberg cold.

Appealing to Decision Makers

To explain the first challenge, I turned to Mark Cohen, a founder of The Digital Legal Exchange, one of the first and most prestigious not-for-profit-efforts to pull together thought leaders in the legal technology space. Mark is a supporter of the Legal Tech Talk conference since its inception, but noted, “the challenge is not with the conference. It’s the companies that are formed by a combination of mid-level lawyers and technologists, who tend to see law through the eyes of newly minted lawyers, not corporate chief legal officers and law firm leaders who understand enterprise-wide risks and rewards.”

Mark Cohen went on to make one of the most striking observations about LegalTechTalk itself. While the event attracts impressive attendance and garners considerable industry influence, much of the visible audience appears to consist of innovation executives, legal operations professionals, knowledge management specialists, and law firm consultants. These individuals play important roles within modern legal organizations. They identify opportunities, evaluate products, influence purchasing decisions, and frequently serve as internal champions for technology adoption. Yet they are rarely the ultimate buyers responsible for committing significant organizational resources.

As Duncan Weston, former CEO of the global firm CMS and chosen by the FT as one of the twenty most innovative law firm leaders of the past twenty years, told me: “I appreciate the huge value of innovation and the enormous engagement in the industry from legal tech, private equity and young lawyers who bring new ideas to problems. How law firms and general counsel reorganize their enterprises however is going to require new business models and the work of experienced leaders, to get the engagement of the buyers.”

Major technology investments within corporations and law firms are generally approved by senior leadership. Corporate legal technology decisions often require support from chief legal officers, general counsel, chief executive officers, chief financial officers, procurement leadership, and executive committees. Law firm technology investments frequently require approval from managing partners, chairs, executive committees, and governing boards. These leaders evaluate technology through the lens of enterprise strategy, financial performance, risk management, client service, competitive positioning, stakeholder management and long-term return on investment. Their concerns are fundamentally different from those of innovation teams charged with evaluating emerging solutions.

Elliott Portnoy, founding Global CEO of the world’s largest law firm, explained that “deciding how to integrate AI across a firm or legal department can be career-defining if it goes wrong. Leaders are not asking whether the tech drafts faster. They are asking whether the team behind it can be trusted with a decision this consequential. Senior decision makers do not buy software. They buy trust. Private capital is now evaluating the legal sector through the same lens. Until legal tech companies can answer that question credibly, they are not in the sales cycle.”

This distinction matters because many legal technology vendors continue to market products as though software purchasing decisions are driven primarily by product features and user experience. Demonstrations focus on interface design, workflow enhancements, drafting speed, research capabilities, and productivity gains. Those attributes matter, but they are rarely sufficient to justify major enterprise investments. Senior decision makers are purchasing business outcomes. They want measurable reductions in risk, improvements in profitability, stronger client retention, enhanced competitive positioning, operational scalability, and strategic advantage. The legal technology industry often speaks extensively about technology while spending comparatively less time addressing the business case that ultimately determines whether technology is adopted.

The Existential Crisis

Second, the biggest iceberg is not off in the distance but calving off a continent while the Legal Tech conference was going on. Nearly every session, panel, and vendor demonstration revolved around artificial intelligence. Yet remarkably little attention was devoted to the growing role of foundation model companies themselves in legal tech. Anthropic, OpenAI, Google, Microsoft, Perplexity and other major AI developers are investing billions of dollars into advancing the capabilities of large language models. Every improvement in reasoning, drafting, summarization, retrieval, analysis, and domain-specific understanding increases the capabilities available through the underlying platforms upon which many legal technology companies depend.

This reality presents a difficult strategic question for the legal technology sector. A significant percentage of legal AI companies are building specialized applications, interfaces, workflows, and vertical solutions on top of foundation models developed elsewhere. Many have created genuinely valuable products. Many possess deep domain expertise and strong customer relationships. Yet the economic and competitive implications remain difficult to ignore. If foundation model providers decide that legal services represent an attractive vertical market, they possess resources, engineering talent, research capabilities, and distribution channels that few specialized vendors can match. The prospect of direct competition from companies such as Anthropic appears to receive far less public discussion than its importance would suggest.

The Change Required

Ironically, equally absent from many conversations at the Legal Tech conference was a serious discussion on the issue that the big companies will not put out of business– implementation. Pivoted more to implementation could save many of the now threatened businesses. The legal technology industry remains fascinated by product innovation. New capabilities generate excitement, attract investment, and drive conference attendance. Yet most organizations do not fail because they selected the wrong technology. They struggle because they underestimate the organizational challenges associated with implementation. Technology adoption requires changes to workflow design, governance structures, training programs, performance metrics, risk management processes, staffing models, and organizational culture. These challenges are difficult, expensive, and frequently political. They determine whether technology generates measurable value or becomes another underutilized software platform.

The lack of attention devoted to implementation is particularly striking given the maturity of many legal organizations. Most large legal departments and law firms already possess substantial technology stacks. The challenge is increasingly less about acquiring another tool and more about integrating technology into the daily behavior of lawyers and business professionals. The industry continues to devote enormous attention to software while spending comparatively little time discussing organizational transformation. Yet organizational transformation is where most value is ultimately created.

The Music was Great, The Icebergs Not So Much

LegalTechTalk deserves credit for bringing together a remarkable collection of participants focused on the future of legal services. The conference reflects an industry filled with talented professionals attempting to improve how legal work is performed and delivered. At the same time, the event highlights several questions that may prove more important than the technologies currently attracting the greatest attention.

First, do the legal tech companies as a group understand who they are selling to? Second, as foundation model providers continue advancing into specialized domains, how will legal technology companies will face new competitive realities? Third, can today’s companies change to face the fact that as organizations move from experimentation to deployment, implementation challenges will become more important than product demonstrations.

While many of these companies today may feel like they are Jack Dawson shouting “I am the king of the world!” many of them may be more like Jack slipping out of Rose’s hands if they don’t make changes now to position themselves to avoid chilly catastrophes ahead.

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