Transforming Legal Practice: Jack Newton on Clio's Success and Vision

I thought every lawyer practiced in a big high end downtown firm with a thousand plus lawyers. What surprised us is the legal market, which is a very SMB market. About 80% of lawyers practice in firms of less than 10 lawyers and a full half of all lawyers practice as solo. It's a very SMB market. The light bulb moment I would say was the cloud is a uniquely good fit for this solo small firm segment and they are dramatically underserved with the technologies of the day. Without your people, you're nothing. Clio is not a company, but rather a network and a fabric of human beings that have locked arms together to go do something big and challenging. And without a culture that drives high performance or pursue what sound like impossible and audacious goals, we couldn't have done anything of the scale of what we've accomplished over the last 16 years without that culture. So many companies stall out at $10 million of revenue. There's just this cap that unless you figure out how do I create a scalable organization where decision making, if you think about as a tree, can be happening closer to the leaves rather than at the trun, you're going to effectively govern the rate of growth of the company in the organization. And the only way you can set up the leaves of that tree to make decisions is to create a lot of context for good decision making. And that's basically information.

Good day and welcome to the Wealthy Entrepreneur Podcast. My name is Bob Govro. I will be your host today. Just want to remind you that this is the place where we dissect the elements that contribute to entrepreneurial success from mindset and leadership to profits and revenue. I have a really special guest today, certainly a very, very successful CEO who's built a world class organization that we are super proud to be aligned with in their space. This episode is going to be called Building a Legal Tech Powerhouse. Insights from the Founder and CEO Jack Newton of Clio. Now Jack is the Chief Executive Officer and founder of Clio, a company revolutionizing the legal experience through cloud based and client centered legal technology. With foundations in AI and machine learning research, Jack has been the forefront of leveraging advanced technologies to transform the legal industry and from cloud accounting or cloud computing to AI. Today, Clio is the legal industry's most robust technology platform used by more than 150,000 legal professionals across 100 countries around the world. Widely recognized as a pioneer in the legal tech industry, Jack has led the charge in educating the legal community about the security, ethics, privacy considerations and and advantages of operating a law firm in the cloud. Through his visionary leadership, CLIO has significantly improved the lives and businesses of lawyers while simultaneously increasing accessibility and equity in legal services through innovation and technology solutions. Jack is also an accomplished author. His best selling book, which we're going to talk about today, the Client centered law Firm guides law firms to thrive in today's experience driven era. His insights and thought leadership have been instrumental in shaping the future of the legal profession. Follow Jack Newton for his timely commentary on technology, the legal industry and the future of the profession for everyone who's listening today, we are a proud partner of clio, helping lawyers not only implement Clio but to migrate over to their platform and ensure that their accounting is tied in nicely with their practice management solution, which is clio. We help support lawyers with that, bring their information over into Clio and into QuickBooks. A very successful, accomplished solution that that ties in nicely with Clio. So super proud to be a Clio partner and super excited to bring Jack Newton in today to share a little bit about his story. All right. So super excited to bring in Jack Newton, the CEO of Clio, one of the companies that we're so excited to be partnered up with and offering support and solutions as well. Jack, what I would love for you to do, you've had so much success and you've got an incredible story. Can you share with us a little bit about how your entrepreneurial history started and maybe a little bit more about your journey along the way?

Yeah, happy to do that and thanks for having me on the podcast, Bob. You know, my entrepreneurial journey, you know, probably traces all the way back to, to being a, a teenager in Edmonton, Alberta where I number one, you know, always wanted to, to start a business. When I was 13 or 14 I started a business building computers from scratch and selling them to friends and family and, and and folks in the the neighborhood. This was before the days of Dell and kind of mainstream PC brands and I was, you know, as you might imagine, a bit of a computer geek and built that kind of a business with my two brothers. You know I built a snow shoveling business in our neighborhood in Edmonton as well and Friday was bid to Edmonton they might know it's you know, really great city to have a snow shoveling business. Lots and lots of snow over the winter and importantly, you know, over the course of growing up in Edmonton I met my co founder Ryan Govreau who you and I were just talking about Bob, trying to figure out if there's any relationship between your families. But I met Ryan in grade three in Edmonton we became fast friends and we initially obviously bonded over things like video games. I remember the first Doom game and Age of Empires and some of those games being the, the games we grew up on and really loved. And as we went off to university, Ryan ended up coming out to Vancouver to go to sfu. I went to the University of Alberta and pursued computer science, eventually getting my master's degree in computer science. I went to work for a University of Alberta spinoff company called Canomics that was building some really cool medical diagnostic software. And I basically got hired as software developer number one to build this, this analytics platform. And we went through a fundraising process. We went down to the Valley and we partnered with a hardware company called Varian that was building nuclear magnetic resonance instruments, which are basically high field versions of, of MRI machines that could analyze biofluids. And I just got exposed to this really exciting world of technology and startups, and I really caught the startup bug and eventually phoned up Ryan and said, hey, you know, I think this cloud thing is going to be huge. This was back in 2007, and at this point, you know, the cloud was, I would say, an emerging technology. You know, Salesforce was just starting to get started. There was companies like 37 Signals and Basecamp Building web applications, but it was a pretty nascent industry. But to me, as a technologist, what was really clear to me was this was a really important platform shift. And this, this shift from on premise and desktop software to the cloud was going to be really transformative and going to present a lot of opportunities in almost every industry. So I phoned up Ryan and said, again, this cloud thing is going to be big and let's hone in on an industry that we think is ripe for transformation. And I described me and Ryan at that point as being, you know, two hammers looking for a nail. It was like, we know the cloud is going to be the tool. What's the industry we're going to go revolutionize. And at the time, Ryan was working as the IT manager at Gowlings, which as you know, is one of Canada's largest law firms. One of the, the seven sisters law firms with over, you know, at the time was over a thousand lawyers across Gowlings. And Ryan's comment to me was, well, well, look, I'm working in legal. I can see how law firms use technology, or maybe better put, don't use technology. This was 2007. This is a huge opportunity. And we went to work kind of analyzing what the state of affairs was in the market and what we were really surprised by was a few things. One is, despite there being a preponderance of software platforms out there, you know, at the time there was Time Matters and PC Law and Amicus, Attorney and Abacus and you name it, this, this long list of practice management systems, they saw very little adoption, especially among solo small firm lawyers. And when we interviewed those lawyers, they told us those systems are too expensive, they're too hard to use, they're hard to implement. You know, back in the day, of course, you needed to get a server and get an IT consultant to set up that server, and it was just a lot of work to get up and running with the software. So we felt this is a unique opportunity that the cloud presents to really disrupt and transform this segment of the market. The other thing we were really surprised by as we started to investigate the market was despite the fact that, you know, Ryan was working at Gowling's and they're obviously a big firm, my knowledge of the legal space was pretty much informed by network tv, movies and John Grisham novels. So I thought every lawyer practiced, you know, in a big, high end downtown firm with a thousand plus lawyers. What surprised us is the reality of the legal market, which is it's actually a very SMB market. The majority of lawyers practice in firms of less than 10 lawyers. About 80% of lawyers practice in firms of less than 10 lawyers. And a full half of all lawyers practice as solos. So it's a very, very SMB market. And the epiphany, the light bulb moment I would say was the cloud is a uniquely good fit for this solo small firm segment and they are dramatically underserved with the technologies of the day. And our thesis was really, lawyers have a reputation for not adopting technology. And the narrative at the time, and I think even the narrative to some extent today, is that's the lawyer's fault. Lawyers don't want to adopt technology. And when we looked at the products of the day, we felt, well, this is actually a problem with the technology. We used all the software out there and analyzed how it worked and it was awful software. You know, it was really hard to use. It was for the most part a thin layer of lipstick over a database interface, more or less. And lawyers were expected to use this. It was just way too hard. So we took a bit of a gamble in 2007 and said, lawyers will get comfortable with the idea of moving their practice to the cloud and storing their data in the cloud, which, which feels table stakes today. But it certainly wasn't in 2007, 2008. But that was the big gamble when we launched Clio as the very first cloud based practice management system. And the rest is history, I guess. But that's the short version of my entrepreneurial journey and the Clio origin story.

Yeah, I love that. And well thought out though, you know, because I feel like a lot of the success stories of startups do start from, you know, concept. Love the idea that you had the Silicon Valley sort of experience. It got everything, it got the blood flowing. But you guys definitely did some really incredible research at that time, even talking about a thesis, because I think when I started, I started in 2008, so it was also like a very complicated couple of years when you started too, with a recession and everything.

Yeah, for anyone that remembers that time period, not, not the most ideal time to be fundraising and. Yeah, you know, for any listeners that are maybe entrepreneurial and thinking about how do they get a venture off the ground. One of the really informative books and individuals that shaped my thinking in those early days is a guy named Stephen Blank that wrote a book called Four Steps to the Epiphany. And he really talks about this idea of customer development over product development and talks basically about how to be very human centered in your design process and work backwards from a problem. And it was Steve Blank's thinking that really, eventually ended up really influencing Eric Ries and the Lean Startup methodology. And we really applied that in the early days of Clio and felt like we identified a really clear pain point, a much larger market opportunity than we thought, and did as much as we could to validate the idea, including working with the Law Society of British Columbia, actually. And when we were talking to them about the idea, one of the things they really highlighted for us was we were talking with the Director of Practice Standards at the Law Society of British Columbia. And what he helped us understand is that the vast majority of his job is basically disciplining lawyers when they've broken kind of rule or run, run afoul of the ethics rules of some, some shape or variety. So that could be mishandling trust accounts, that could be failing to communicate with clients effectively. That could be missing a key limitation date. But, but his comment was the vast, vast majority of his work involves dealing with the solo small firm lawyers that run afoul of those rules. And, and that the large firm lawyers are good because they've got this huge human infrastructure set up around them where paralegals and support staff, if they drop a ball, somebody else catches it before it hits the ground. And solo small firms don't have that, that human infrastructure. So our question was, it seems like they need to counter that with some really strong technological infrastructure. And that's where the idea for Clio and the cloud opportunity really crystallized for us is saying we can really not just help these solo small firm lawyers run a more effective practice, but also a more compliant practice that helps them stay on the right side of their ethical obligations and their obligations to the, the rules of professional conduct.

Absolutely. And quick plug for Clio for any of the lawyers that are listening as well. One of the greatest challenges that lawyers have in practice, at least from my perspective, is managing your trust account. CLIO has a fantastic program that helps manage your trust account. So anyway, we work, we work within that environment. It's fantastic. If you don't have that and your trust account is stressful, make your life easier and jump in and work with Clio on that.

And the inspiration for that, Bob, by the way, was, was hearing from all sorts of law societies and bar association leaders that we interviewed saying trust account management or mismanagement is almost universally in the top three reasons lawyers get disbarred in their jurisdictions. And we felt, you know, we could design a system that made that virtually impossible to do. You can't overdraw a client balance. You can't overdraw a matter balance. We made it really watertight and we said we can, we can help lawyers save their jobs. You know, and these, these are the, the stakes are just way higher than they are even for the average professional. That the stakes are super high and the idea of losing the license that you've worked your entire life toward is just incredibly high stakes. And how could we wrap a really high level of protection around the way trust accounts are handled? Whereas as you know, standard off the shelf accounting software doesn't have any kind of protection or coverage on that front.

No, exactly. And so, and we deal with this all the time too, right, Jack, where it's like the people lose sleep at night worried about their taxes, their finances, and lawyers lose sleep at night worried about their trust account and going, oh man, what if we don't have this reconciled to the T, what if, what an easy solution to have in place to sleep better at night. You know, it's just a great outcome. The first time I heard about Clio, I was actually reading a book called Cultrepreneur and it was highlighting Clio in there as an organization that built this extraordinary culture, this very employee centered environment that everyone wanted to be part of. How important has culture been for the success of Clio?

I mean, I would say essential in the sense I would attribute all of our success to our culture. And I really think, you know, it's a bit trite to say, but, but without your people, you're, you're nothing. And Clio is, you know, not a company, but, but rather a, a network and, and a, a fabric of human beings that have locked arms together to go do something big and challenging. And without, you know, a culture that drives high performance, without a culture that drives people to pursue what sound like impossible and audacious goals. We couldn't have done anything of the scale of what we've accomplished over the last 16 years without that, without that culture. So without overstating it, I, I would say I would attribute all of our success to, to culture and, and from the very beginning of Clio. And one of the reasons Ryan and I founded Clio initially, and you might laugh at this, by the way, but our ambitions with Clio were initially really humble. We, we did not want to build or even think there was the opportunity to build a huge 1100 plus person company, which is what Clio is today. We, we thought we were building something that might grow to three or four people over time and that if Cleo threw off enough money to make a living for me and Ryan, that would be, that would be success. But our experience in working in other companies and other organizations in the first decade or so of our professional careers left us thinking we can build a better work culture. Like we want to build a great place to work that enables people to do the best work of their lives. And initially we thought that would be really a bit of a lifestyle business with a handful of employees. And obviously Clio ended up being a much, much bigger company and success than we ever thought possible back in 2008. But that same thinking about how we create a high performance organization and how we create the kind of company Ryan and I would want to work in ourselves is something that was always at the forefront of our minds and we've always been very deliberate in how we think about culture and how we, how we scale our culture. I would say our cultural North Star at Clio is building what we describe as a human and high performing culture. And what we mean by human and high performing is our expectations are everyone in the team is a high performer. You know it. If you're the kind of person that just wants to go to a job and coast Clio is not the company for you, like we want people that are thinking big, thinking about their careers, thinking about how they perform at the highest level possible. But unlike some organizations that are very high performance organizations and kind of leave it at that, we thought, let's wrap a very human and deliberately developmental layer around that high performance expectation where we realized not everyone walks in the door fully developed, fully, fully ready to be that high performance individual. And how can we create an organization that helps every person that joins Clio ramp really quickly and become high performing? And if they're already high performing, even more high performing. And so we invest a ton in learning and development. We have an entire team that is just focused on training and developing our employees. We have a dedicated performance coach on staff. So you're probably familiar with the concept of executive coaches, and that's usually something that's reserved for the C suite at a company. We've got a dedicated performance coach that's available to every single person at Clio, from a C level Exec to an IC1 contributor that just joined the company because we realize everybody needs that level of support. We have a dedicated leadership development program that we developed ourselves that again, most companies would bring in an external consultant to do this. But we have our own multi day leadership development program called Basecamp that we've now put over 20 cohorts of our staff through over, over the last five or six years. So we talk about this concept of being deliberately developmental and this goal of being a human and high performing organization. And when you interact with people from Clio, and I hear this all the time from folks on the ground at Clio Con or, or from partners like, like yourselves, they see that culture shine through. And it's always really terrific for me to hear that feedback because I do feel like it's our single biggest competitive advantage in the marketplace. And the thing that is, is setting us up to achieve our long term mission as well.

Yeah. And just before we hopped on, I said, jack, I got to let you know every single person that we worked with within Clio. And I was like, I have an exhaustive list. I started to create and I was like, oh, I'm going to just mention it, two or three people. But then I, my list became 10 plus people. And I was like, okay, well, they're all amazing. We, we know that. Right?

It's terrific. No, I appreciate that. And I hear that, that kind of feedback all the time. And it's just so rewarding to hear how, you know, the culture and the values shine through.

Yeah. And, you know, it's no Question that this focus has helped you guys become Canada, one of Canada's best managed companies. Over and over, you guys get recognition for growth and achieving success within your organization. It's interesting when we start talking about leadership and you go from. You and Ryan go from being, you know, two guys with a concept to 1100 employees, and last time I heard it was a thousand. So you guys have been growing at an exponential rate right now, which is amazing. Amazing. So what are maybe some of the challenges that you faced early on when you started building a team, even though you had the idea of, well, this is the culture created. Because I know for me, when we got up to, you know, 30 or 40 people, I started to not be able to see everything and have that visibility. So it was like, oh, man, we need more accountability that happens. We need more scheduled touch points, we need more direction and, and really, again, accountability with our team. What are some of the challenges that you had early on that you had to overcome?

Yeah, I would say there's been a few major chapters in Clio's growth journey, and I think, to the journey you're going through. Bob, what is tough, I think, for. For founders is, is letting go. And again, you know, in the, in the early days of Clio, you know, for the first year or so, Clio was literally just me and Ryan. So we were wearing every hat and both of us had technical backgrounds, so we coded the first version of Clio. We were then also technical support for Clio. We were wearing every hat, and you know what that's like. It's challenging, but you also have perfect visibility into everything that is going to. Going on in the.

In the company, which was wonderful back then, you know, as. It felt great.

And I, I felt like, you know, one of those early tipping points was hitting, you know, maybe about 50 people or so, where all of a sudden you don't know everything that's going on and you have other people in the company doing hiring, for example. And that scaling journey from 50 to 150, I found it was a really interesting part of the journey where we had. We had to deliberately start letting go of some things, but then also recognizing a few of the things we couldn't let go of because it was too high stakes. And I'll give you one example of that. One was, you know, I remember me and Ryan showed up to the office one day, and this was as we were approaching employee number 100, and for the first hundred hires or so, Ryan and I had been involved in every single hire. And then we hired a VP of sales and said, you can go do your own hiring. Then me and Ryan walked in the lunchroom one day and saw this one individual that we'd hired that, you know, just clearly was hungover. Like, not. Didn't seem professional. And Ryan and I were kind of like, did. Did you hire this person? No. Did. Did you hire them? No. And. And we realized that we'd hired somebody that just wasn't a good fit for the culture at all. But it wasn't us that had done it. It was one of our newer hires on the sales side. And we realized at that point that, hey, even though we want to delegate a large amount of the hiring decisions to our hiring managers, we still need to ensure there's cultural alignment and that this person is a fit for the kind of culture we want to create at Clio. And so we introduced a hiring screen, what we call the culture screen, where me or Ryan ended up being the final interview for every hire for our next 500 hires. And then we scaled it out from there. But we made sure that we've got that touch point. And most people would pass that culture screen, but some wouldn't. And that was well worth the investment that we made to introduce that culture screen. I would say another key tipping point in that cultural evolution was when we hit around 150 people. And I think this is around where your organization is today, right, Bob? We're.

We're at 105. So I'm. My awareness is very keen right now. I'm listening.

You're on that 105 to 150 journey. And, you know, 150 is a really important number because that's what's often described as the Dunbar number. And Dunbar was, was a social scientist. And he talked about this idea of basically the maximum number of relationships you can keep in your head at one time. And it's about 150 people. So if you look at all sorts of social constructs over the years, there's a lot of organizations that naturally orbit around this 150 number, because that's basically where the maximum size, you can have tight cohesion with a team, kind of know everybody's name, know the name of their kids and what sports they like and all that stuff. And beyond that, you start to lose the ability to even track who the people in your company are. So as we passed that 150 number, one of the things we had to, or bring in and codify really was our values. And we, we really wanted to. To instill a clear sense of what our values were. We knew we had something special in, in the company. We knew our values implicitly, but we did not know them explicitly. And, and so we, we did a bit of a grassroots exercise with our team and, and, and got all sorts of different groups together, focus groups essentially, and, and said what, what do you feel like Clio's values are? And, and we ended up writing down our initial set of seven values, values that you could actually check out@culture. Clio.com outlines our core values today. But values like customer success comes first and values like draw the fucking owl are values that came out of that exercise. And it was really instructive to have these values listed. And what they ended up becoming is something that people reference on a daily basis. At Clio, which is so great to see. We see people using these values in their daily language. They're used in our hiring rubric. So people get assessed in terms of how they demonstrate the ability to live our values through their past experience. Their values we use in our promotion framework when we're promoting employees and their values. We reference if we're terminating people because they're not a good fit for the culture. So that values framework is really important. Another really important evolutionary part of our journey was instituting OKRs and a system for scaling how we track goals and how we track what's important in the company. And again, you might be going through this journey right now, Bob, but when you, you have, I would say, you know, less than 50, you know, maybe even less than 100 employees, everybody kind of automatically knows what's important, right? There's just this, this organic understanding and this osmotic flow of information and priorities that people just kind of know what's going on, why it's important and what the different priority trade off decisions they should be making are. And as you scale past 100, that becomes a lot less clear. And, and we adopted about 10 years ago this framework called okrs or objectives and Key results. And, and what's really nice about this OKR framework is that you can set the highest level objectives and key results for the company. And the objective might be something big and audacious sounding like become the leader in legal practice, management in the cloud. And the key results could be very specific, measurable, quantifiable results like win 25% market share in new logos in 2024 or something like that. But what's nice is those objectives and key results can then ladder down to every department with their flavor of how they drive those company level. OKRs. And then ladder down to the team level and even ladder down potentially to the individual level. So you get this hierarchy of priorities across the organization and discussions around priorities and resource allocation become really as simple as saying is this an okr? And if so, how does it rank relative to my other priorities? And it helps drive these tough prioritization decisions in the company in a really clear way. So that was another part of our scaling journey that I found was really important. And both our values and this goals framework we instituted at around 100 employees as we crossed that Dunbar number of about 150 employees. And both of those frameworks have evolved and changed over the years of course, but they're still serving us really well at 1100 plus employees. So I would say one takeaway is, you know, around 100 people you want to be putting in the foundations of culture and goals and kind of your operating system as a company that will set you up to successfully scale and often if you do a good job of building that foundational framework, it will serve you for many years to come.

Completely agree and such great advice. Anybody who's at that stage, it's imperative. And I can tell you, for us, and the same with you, Jack. It was like there's this expectation that everybody knows what they're supposed to do, they're doing it until you start going they should know this, right? And you start questioning it. And I know I've had that self reflection where I go, they, they should know this, but maybe they're not doing it. Maybe I need to do a better job making sure that they do know what's, you know, responsible for them to take care of. And, and can we have a better, more clear, objective list so that they do know and that there is clarity instead of having any confusion. And for sure, setting up a system like that is 100% necessary for success.

And the amount you need to communicate goes up exponentially as the organization scales. And I think that's the other key learning for me is, you know, unless you are so sick of hearing yourself say the same thing over and over and over again to the organization, you probably haven't said it enough. And, and I'm, I'm guilty even of thinking, oh, I said this thing in a town hall a year ago. Doesn't everyone know that? Because I said it in a town hall a year ago. And then I realized we, we've hired 40% of the team in the last year. Right. And, and, and just you, you really have this bias as, as a founder and CEO kind of assuming everybody understands what's going on in your head and the more you can. A great book I read recently, actually. I, I don't know if you've read it, Bob, but I recommend it if you, if you haven't is Reed Hastings new book called no Rules Rules. And he talks about the culture he built at Netflix and they have this culture of doing what they describe as leading with context. And I just really love this idea because the idea is you need to spend a lot of time downloading with your team as a leader and giving them the context for what's going on in your head. If you've made key decisions, what informed that decision making process but giving them the context to make decisions with the overall idea being you want to push decision making as low into the organization as you can and you want to create as much autonomy for decision making as you can as low in the organization as possible to achieve velocity. And otherwise you end up being the choke point. Right? The trap a lot of companies fall into if they don't figure out how to do this well is I end up becoming the choke point. You end up becoming the choke points. The leader of the company ends up becoming the choke point and essentially the rate limiter for the organization's growth. And I think that's why you see so many companies kind of stall out at that Dunbar number. It's why you see so many companies stall out at $10 million of revenue. There's just this cap that unless you figure out how do I create a scalable organization where decision making, if you think about it as a tree, can be happening closer to the leaves rather than at the trunk, you're, you're going to effectively govern the, the rate of growth of, of the company and the organization. And, and the only way you can set up the, the leaves of that tree to, to make decisions is to create a lot of context for good decision making. And that's basically information. So how much information can you share with the team and specific groups to give them the maximum context to make great decisions? And I think what your job as a leader ends up evolving to over the course of many years is basically just one where you're delivering context to your team and helping them place their decision making in a maximum information environment that helps them make the best decision. And that might not always be the decision you agree with or think is the right decision, which is a deeply uncomfortable thing to, to, to embrace. But you really kind of need to get comfortable with the idea of sitting back and letting people Fail and then pick themselves back up with the benefit of the learning of that failure, better positioned to make the great next decision.

It's so funny that we're talking about this because this has been an area where I've been looking at a lot, you know, looking at the empowerment of team members and one of the greatest, at least my research is suggesting one of the greatest nemesis to this actually happening is that individuals keep coming back and asking, you know, opinions. And then because we as leaders tend to make decisions fast and we can analyze things very quickly, that we end up just going in, in the essence of saving time, we're just going to make this decision for you or just say, oh, I think you should do this. And it's, it defeats the idea of the empowerment so quickly and it's, it's amazing that we're actually chatting about this.

That's exactly it. That's exactly it.

And super frustrating because you as a leader, you think, okay, we're actually just helping them, aren't we? But no, we're actually hurting them drastically because now that we're making those decisions, even though they're asking for our advice, we're taking away their ability to make that decision on their own.

That's right, yeah. And the other thing about these decisions I would highlight is thinking about type 1 versus type 2 decisions and whether these are another way of talking about type one versus type two is, is this a one way door or a two way door? And, and there are certain decisions you might need to be engaged in as a leader because it's a one way door. And, and if you get that decision wrong, you're, you're stuck on a path that might be categorically the wrong path. But most decisions are type two decisions that, that you can revisit. And, and if you've made a wrong decision, an incorrect decision, a suboptimal decision, you can revisit it and, and make that a learning experience for the, the team. And I, I think that's another. It's a tough thing and sometimes it's hard to discern between the two. But to the degree you can, I think that's enormously impactful and helpful to your team if you can step back from some of those decisions for sure.

And selfishly, I want to maybe go one step back. When you're talking about as the leader reinforcing the message and the importance of that, what does that cadence look like for you now that you've got 1100 employees? How often are you getting in front of them? You've got employees all over, at least North America, if not around the world now. So what is maybe the form of getting in front of them and maybe the cadence of how you share that message?

Yeah, absolutely. So to the company as a whole, I do a monthly town hall and that's about an hour and 15 minute monthly presentation that the whole company tunes into. We actually just did our June town hall yesterday and we've got, you know, a live group of folks in front of me in our Vancouver office, which is great. And then all of our remote teams are, are dialed in. Remote of course. And then we've got groups of people tuning in for almost viewing parties that are different. What we call our hub offices in, in Calgary, Toronto and then we do have international offices in, in Dublin and Sydney, Australia that, that watch the town hall on a tape delay. And that town hall is really a bit of a state of the nation, like what's going on with Clio. We're a very transparent organization by the way. So we were very transparent about, you know, here's our financial goals, here's, here's where we wanted to be on, on our revenue plan. Here's where we're at. You know, we're either above plan, let's celebrate that or maybe we, we missed for some reason. And what are our learnings, what's our action plan, what's our, how are we going to inflect that as a team? We Talked about our OKRs on a regular cadence as well. And we have the annual OKRs that we break down into a quarterly basis. And that monthly town hall is a really essential touch point with the rest of the team. We then have a rotating set of executives that talk to the team on a weekly basis in what we call our all hands. And that's, that's a 30 minute session where we walk through what's going on with a specific department and maybe highlight some of the wins and learnings from that team over the course of the last month or two. And then we have a set of regular updates and announcements through Slack and so on that give people updates on key metrics and how we're progressing on key initiatives. We have an annual kickoff for our team that we call Team Day and we bring the entire company together for two days of planning and focused collaboration and basically announce our product roadmap for the year. We announce our revenue and sales plan for the year, we talk about our strategic objectives and that's a really powerful way to align the whole company around what we're doing. For the next 12 months. And then I personally try to get to our, each of our offices over the course of a year as well. So that's, that's visiting a different office maybe once or twice a quarter, depending on how the rest of my travel schedule looks as well. So connecting with people in person is, is really important for me as well.

Yeah, love that. So thinking of leadership, because I feel like this is, you know, becoming a leader of a team of a certain size is definitely not something that I anticipated that I was going to do either, Jack. So I can appreciate when you said, oh, we were just actually planning to build something that gave us enough income to live a nice life. And then all of a sudden the demand goes, your passion increases. Building a team all of a sudden becomes special. And I know for myself, I remember hitting a little bit of a plateau, going, oh man, I don't know that I'm the leader that this team is going to need, not in the state that I'm in. And it obviously sounds like you're well read, well educated in leadership. That's where I dove into as well. What has been some of the progression or path that you have taken to become that leader of an 1100 person organization? What did that look like? And what are maybe some insights that you would share with others?

Yeah, it's a great question. And I think concept I talk about a lot with the team is the idea that if the company is in hyper growth mode, and if you think about the growth rate for the company as, as being, you know, essentially an exponential curve, you need to make sure you're developing as an individual at the same rate. And if you're developing, for example, in a linear fashion, you're quickly going to get outstripped by the organization and its needs. Or maybe you're not growing at all and you're flattened. That's why we talk about high performers being essential at Clio, because if you're not in this hyper growth mode yourself, you're not going to be able to keep up with the organization. So, you know, something we talk a lot about at Clio is look like even, even if you might be the right person for this specific role today, you might not be the right person in a year or two if you don't keep up with the growing demands of this role. And you know, whether you're an IC1 or a VP or the CEO, that same filter applies. And, and, and so the commitment I've made to the organization is the, the minute I feel like there's A better leader for Clio than, than me. I'm going to bring that person in and it might be, you know, maybe it's scaling from a thousand people to 5,000 people or 5,000 to 10,000, that, that we're going to need a, a different leader that knows what that path looks like. But at least for the time being and for the run to this point, I've been able to keep up with the, the demands of the organization and, and been able to effectively lead it into its next chapter of growth. But what, what that's required of me is I would say, an appetite to learn. Like, I think as a leader, whether you're the CEO or a leader of a small team, like, I think you just need to be a learning machine. You want to read as much as you can, you want to listen to as many great leadership podcasts as you can. You've got to create a mentorship network and find other leaders you can connect with and learn from. And importantly, build a team around you that can help you navigate that next chapter of growth as well. So, you know, every single day I'm running the biggest organization of my life at Clio, and you know, that's, that's both exciting and terrifying at the same, the same time. And what I want to do is make sure I'm surrounded by leaders, at least some of my leaders that have seen what this next stage of growth looks like. You know, for example, my CEO Ronnie Gurion was at Uber and, and saw what billion dollar revenue and ten thousand plus person organizations looked like at Uber and knows what operating and executing at that scale looks like. My VP of Sales, Jenny Dingus, was at RingCentral, a publicly traded company with hundreds of millions of dollars of ARR, running a massive sales organization and knows what that next chapter of growth looks like. So I think a crucial thing to learn on, lean on as a leader is that you don't always need to be the most senior person in the room in terms of experience. You may be the CEO, but wrap yourself and surround yourself with people that have seen some stage of the next chapter of what your growth journey looks like and then you can fast forward through that beyond people that are on your team. Think about your mentorship network and the people you're learning from and again, try to surround yourself with people that have been in that next chapter of growth. And as I think about growing Clio eventually to a billion dollars of revenue, you know, I'm talking to CEOs that have achieved that kind of revenue scale and, and know can help me understand what that path looks like and how we need to be thinking about that strategically. I, I think it's also important, you know, to have the humility and the self awareness to know that I think the, the imposter syndrome that you may have felt some flavor of. Bob and I, I think all of us feel like I, you know, a team day. I looked around at a room of, you know, again, a thousand people attending in person and attending remotely and for was both excited and, and again a bit terrified. Like while I'm leading this enormous team, am I equipped to do that? And I think that existential question that many of us, you know, struggle with as, as leaders is something that is a very common feeling, if not a universal feeling. So just leaning into that knowing like we're all just doing the best job we can, we've got to lean on each other, we've got to be learning machines but, but also have the again, self awareness just to realize, you know, this is a very hard job, it's a very lonely job. And it's, it's one that everyone I think struggles with some of those dynamics. And finding a peer group that is also navigating that is, is something I think that's really essential for leaders of every level, but especially the, the CEO role.

Amazing. I love that. And so since we're talking about being well read and reading good books, I've got your book here, sir.

Thank you.

The Client Centered Law Firm, which is fantastic. How to Succeed in an Experience Driven World. If you guys have not checked this book out. Definitely check it out. Jack, do you want to give a summary of what you've included in this? Which is like a heart and soul sort of book as well, right?

Yeah. So I wrote this book about five years ago, about 10 years into my journey of building Clio and I, I realized what, you know, I had started to accumulate over a decade in the legal industry was a pretty deep level of knowledge around what the best law firms in the, in the world are doing in terms of how they operate, how they execute and how they think about their, the client experience. They want to deliver it. Also as a product person, what I saw as a huge opportunity was basically to bring some of the principles of human centered design that are pretty well understood in the product, in the design world to lawyering, which, you know, kind of shaping that concept in the context of lawyering is really what drove the idea of the client centered law firm, which is, hey, rather than being frankly pretty lawyer centric in how most Legal services are delivered. Let's be client centric. And even if you think about some really foundational aspects of legal, like the billable hour model, this is a model that is very lawyer centric, not client centric. And what if we went back to a blank sheet of paper and said, let's design legal services from the ground up? How can we do it in a way that is better servicing the needs of clients? And how do we wrap all of our thinking, putting the client at the center of that thinking, and wrap a really great support framework and a very client centered framework around that client? And that's at the heart of the client centered law firm. And I see the need to move to more client centered framework as really being existential for lawyers and the practice of law. If you look at the legal market today, it's broken, right? If there's 77% of legal demand that is not met by lawyers, today, 77% of consumers and businesses that have legal issues are not able to see those issues resolved with the help of a lawyer. And at the same time, you see most lawyers saying the number one thing they need is more clients. So an economist would look at this and say, this is just profoundly broken. How can you have so much on the demand side and so much supply side available and wanting this business and not able to connect? And I think that's because the business model of legal is broken. The modality of legal service delivery is still much too rooted in the bricks and mortar world. And, and the transition I want to see Clio help facilitate over the next decade or so is a transition from bricks and mortar and a very traditional lawyer centered design of legal services to a completely cloud and Internet based delivery model that is very client centered in how it's designed from the ground up. And I think that's a really exciting opportunity to unlock the latent legal market. When you look at that 77% of demand that is unmet, that is a multi trillion dollar opportunity to address that need. So for innovative lawyers that want to embrace technology and want to embrace a client centered mindset, there's an enormous opportunity to be unlocked that is sitting there for the taking and enabling. That is what gets me up in the morning every day and is really at the heart of clio's mission to transform the legal experience for all. It's really seeing that transformation as being part a shift in technology and part a shift in mindset. And that's what CLIO is all about. And that's what the client centered law firm is all About.

Love that. So if you're an innovative lawyer in a law firm or professional services, guys, I got to tell you, this applies essentially to everything. If you're a business owner, check this book out because it's going to show you not only how to be a better business owner and how to innovate, but how to focus on the client centered journey versus being a specific product or outcome. Let's focus on the experience. Last thing I want to talk to you about is this incredible event that you've created, Clio Con. What I had the experience, I've had the opportunity to be at Clio Con. The energy is unbelievable, unmatched. To get, you know, the world's greatest, most innovative lawyers, speakers, presenters, all in one space. It's definitely got to be something that you're super proud that you've been able to create. Can you tell us a little bit about Clio Con?

Yeah, absolutely. So Clio Con, we, we, we invented and it's in, in its 12th year this year, but we, we created Clio Con because we felt like there needed to be a forum for the pioneers of the legal space to get together and talk about what the future of legal looked like and to create a really high energy, exciting environment with great keynote speakers, great parties, thought leaders from across the industry all assembled in one place. And Clio Con has grown from, you know, a 200 person conference when we started it back in 2013 to 4,500 attendees at the last Clio Con. So it's just exploded in popularity and you know, it's called by, by people like Bob Ambrosi, the best conference in legal. And you know, we're really proud of what we've created with Clio Con. If you're an innovative lawyer and want to understand how you can better adopt technology, better adopt AI, better design your business to meet your clients needs, how to grow, how to scale, there isn't a better conference for you to attend. So it's October 7th and 8th this year in Austin, Texas. We're going to have a terrific time there. We've got all sorts of terrific events lined up. We've got a After Dark party at Austin City Limits. And Bob, I'll make sure we get you a discount code to share in the show notes as well for any of your listeners that want to sign up. But I guarantee if you attend, you will not regret it. It's, it's a terrific conference and a lot of fun.

Yeah. And as someone again who's been there was in Nashville last year, I Look forward to Austin this year. I can just imagine as it continues to grow and become better and better and better every time. But one of the things that I'll say is that it's bringing like minded people together with an opportunity to collaborate. Like I've seen so much collaboration in the last year with all the people that attended. So yes, we're coming to learn, we're coming to enjoy the experience. The events are incredible. Everything about it is, is amazing. But if you come in there with an open mind to learn, to innovate, to partner, it's really, it really is the best legal event in the world. So congratulations for that last piece, Jack. I will, I will ask you is if you had one piece of advice for, you know, a small law firm or a small business owner about how they can create some element of professional success or to grow, what would that maybe one piece of advice be?

Identify a unique brand that is oriented around yourself and your personality. I think there are so many lawyers that fall in the trap of being this Persona of, you know, the, the average lawyer, this like composite of the thousand lawyers they've seen on TV and movies and whatever else. And clients want to hire a human being. They want to hire a human being and they also want to hire somebody that is specialized in a specific area and they feel is the best person possible to help them with their specific need. So I, I think the combination of saying pick the thing you're going to be the best at, pick the thing you're going to be the world's best lawyer at this specific thing. Maybe in this specific geography, that focus is hugely beneficial. And then focus on being yourself and building a brand around your identity. Because people want to work with an individual, not a law firm, and they want to deal with an individual with real personality. So I think just, and that lead, that leads, I think just a lot more professional satisfaction as well and being great at something, being yourself, delivering a great client experience, embracing the principles in the client centered law firm. You'll see word of mouth, you'll see your referrals go up. You'll see that flywheel of growth really start to take hold. So that would be my, my one takeaway.

I love that. Guys, this is Jack Newton, founder and CEO of Clio. Wasn't he incredible? So many insights, pieces of wisdom. If you like this episode, make sure you give us a, like, if you know somebody, especially an aspiring lawyer or someone who's looking to grow, wants to be that innovative lawyer, make sure you share this episode with them. There's so many good tidbits in here about leadership and how to create that organization. Make sure you follow us. We will have another episode next week. Again, my name is Bob Goverow. This has been Jack Newton, our guest today. Thank you so much for watching this episode and look forward to seeing you next week. Thanks again.

Jack thanks Bob.