#57 - From Navy Pilot to General Counsel: IPOs and Legal Innovation with Phil Mazzara

Hello everybody and welcome to another episode of Pearls on Gloves Off. I'm your host and Chief Operating officer at Goodwin, Mary o'.

Carroll.

Today we come to you with an episode that we taped live in San Francisco at Goodwin's tech retreat where we brought our teams together and invited some of our clients on stage to share their stories, journeys and advice with us. I had the privilege of hosting today's guest, Phil Mazzara, General Counsel of Astera Labs. Prior to joining Astera Labs, Phil was general counsel and secretary at Innovium, a network switch silicon provider for the data center market. During his tenure there, Phil oversaw multiple venture financings, negotiated commercial agreements with the company's most important customers, favorably settled bet the company litigation, oversaw the creation of a robust IP portfolio, and ultimately led the company through its $1.1 billion acquisition by Marvell Technology. Prior to becoming an attorney, Phil spent more than 10 years on active duty as a Navy pilot. How cool is that? Phil earned a J.D. mBA from Stanford. He has such a unique background as a Navy pilot turned JD MBA who went straight in house and bypassed firm life. I love our talk and only regret that we didn't get enough time to dig into his very cool Navy pilot background because as my regular listeners know, I do love vets and all things military. Phil talks to us about his thoughts on the changing profession, gives his advice to our room full of lawyers, and gives us a great view of what is important to clients or in house teams today. I hope you enjoy our very first.

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So Phil, love to take the time to just have you introduce yourself. His background is incredible. It's amazing. And after I heard it I was like, oh my God, you must be so good at being a general counsel because you've got all these amazing things that would make you, in my opinion, very well suited to do the role very well.

So Phil, perfect. I'm the General Counsel of Astera Labs. I've been at this great company that just went public for about two and a half years now. But prior to that, and I think probably a little bit about why I'm here, I've been a user of Goodwin Services for almost a decade, so I've been at two chip companies. Both of them used Goodwin Proctor for outside counsel. Have a lot of experience working many of you in this room. And if anybody's been following the Astera IPO, our recent Q3 earnings, we've been sort of riding the AI wave. So we sit sort of right in the middle of AI infrastructure. So happy to talk about that as well. But before I became a lawyer, I feel like I sort of have had two different careers. I spent 10 years on active duty in the Navy as a carrier based jet pilot. So I was a pilot and then got to that point in my career where I had to decide do I want to do this for the rest of my life or do I want to get out and do something different? And decided for a lot of reasons, but one was just a more predictable lifestyle and not being away from family so much to go back to school, get trained to do something different. So I did that from 2011 to 2015 and have been a lawyer now for about 10 years.

So incredible background, Navy pilot, JD, MBA, which I don't think we touched on. Went to BGC, got that company acquired for more than a billion dollars, went to another company, bgc, and took that company public. Went public this year in 2024, in March, I think it was March.

March of 2024.

24, which is a year that the capital markets were not booming. But you guys went out at $36 a share. And the last time I checked it was almost 100. So someone's doing something right.

Yeah.

So really excited to see that. Tell me about your journey with the ipo, working with Goodwin. What role did the outside counsel play in that? How important was it to you to choose the right partner? Tell me about that journey for sure.

So I was hired, I was the company's first attorney. So they had not had a lawyer that was founded in 2017. And I came, came on board in February of 2022. So had been around for about five years. But really because the company at that point had raised through a Series C and I think thought that its next financing would be a public financing. As I joined in 2022, I think we saw the market start to close and so we sort of decided to shift gears a little bit and do a Series D and give ourselves a little more time to think about the public markets and the right time to go out. I think the difference about when I joined Astera from my previous company, which was called Innovium, I was at Innovium essentially from the beginning. I joined right after the Series A, also as their first attorney. But I was there as all of the dead bodies were created. So I knew where all the ghosts were. Joining Astera five years after it was founded, it took a little while to sort of figure out where everything was Very similar company. Right. We're in the chip space, data center and AI infrastructure, but had not been with the company for those first five years. So it took a little bit to sort of get up to speed. But then as we started to look out to the ipo, it really was assembling the right team. I was very fortunate to have a set of founders that were willing to place their trust in a second time gc, but somebody that had never worked at a public company and had never, never taken a company public and was forced enough to be partnered with a CFO who had been a public company CFO and was incredibly talented. But as I built out my own team, it was really important for me to have somebody that I could obviously work well with. Right. And that had had deep capital markets experience. We looked around a little bit and we do this for our sort of major projects, whether it's M. And a IPO litigation. Right. We, I think just for good diligence will consider other firms. But because we were a Goodwin corporate client, certainly they were invited to have a seat at the table and got introduced to Brad. We had some conversations along the way and it was a good fit and I knew that we were going to be able to work well together. And he assembled a great team. I see Julia here and Riley, and if I'm missing anybody else, I don't know if Nikki's here. But a really talented team that made me look good along the way and it was a great ride.

That's great. I probably should have mentioned we would love this to be a conversational session. So if anyone has comments, questions that they want to pepper in, feel free to raise your hand and we'll get to you. For those of us who aren't that familiar with Acera Labs, give us a little bit of a high level background about what you do as an organization. Sure.

So our founding team, we have three founders. They were all colleagues at Texas Instruments. They have deep semiconductor experience and background. 2017, when they founded the company, we were already fully in the shift to sort of cloud computing. And they saw the sort of next wave was going to be artificial intelligence. And so they decided in 2017 to take the leap and to work on a set of products which are essentially called connectivity products that were going to support AI infrastructure. So if you think about really large data centers, whether they support cloud computing or AI infrastructure, they're really Composed of three parts, right? There's the compute processors and servers, there's the storage memory products, and then there's the connectivity products, which is like the plumbing that connects all of these things together. And so we're in that connectivity space and we make modules and re timers and switches that allow these other components in the data center to communicate. And it's really critical for AI infrastructure because in order to do all of the machine learning and human speech recognition and all of these enormous data sets, you need products that are very customized to those types of applications. There have been retimers and connectivity modules around since data centers have been around, but none that were really built from the ground up for AI applications. The founders had the foresight to think about that, and so that's what they did in 2017. And we now have four product lines that are serving those markets. And yeah, I think we're at the forefront of this move into AI.

Yeah, it's a good market to be in right now. As a company that is focused on kind of the future of AI, how are you guys thinking about AI as it applies to what you do every day? And specifically, as a general counsel, are you thinking about it as an application actively looking at, like, the way you practice law?

Absolutely. So I kind of think about it in two ways. I think about as general counsel, how we're going to think about AI as a company and sort of put guardrails on how the company thinks about AI, our own internal use. I think I saw an article the CEO of Google the other day said 25% of their code is generated by AI.

Now.

So from the company perspective, and from the general counsel perspective, I think about it from, we are in the process now of writing sort of our company's AI guidelines and AI policies. And certainly I come at it from the IP protection, security and data privacy type thing, making sure the quality is there. That's one level that I think about it, then I think about it of how can the existing legal team use AI? The semiconductor industry is kind of a niche space. And so a lot of legal tech that I think has been useful to other companies has not been useful to me at chip companies, because I think the applications and the customer base is like, very specific. And so if you take an applicant like LexisNexis and Practical Law and some of these things that have very generic contracts that you can go in and sort of try to customize for yourself, it just never really worked for me as a general counsel. So I think the challenge on AI usage within my legal department is when can we find applications that go beyond the hey, can you please draft a letter to so and so about X? Right. These very sort of ChatGPT type applications, what are the applications? Where we can go very deep in a specific space would be extremely useful for us. Right. I mean, we are a heavily controlled industry with export regulations which are about as complicated as the IRS code. We're global now. Right. So we're subject tax regulations in all of these different countries. So applications that could solve or make work easier or more efficient in those deep applications, I think is really interesting. The challenge that I see in other applications, let's just take commercial agreements, for example. Difficult for me to see in the near term AI making a material or positive impact because I don't see the data set there that you could create a model that would be useful. Unlike the export regulations or the IRS code, it's all public. And you can get, you look at IRS opinion letters and Department of Commerce guidance on things. Right. You input your product specs and it says, we think this is the classification for something like a commercial agreement with one of our major hyperscale customers. Right. They're typically confidential. They're not always filed in S1. Right. So there's just not a lot of data. You still really need an attorney that has semiconductor experience that has sat across the table from one of those customers and knows where the pitfalls are. Yeah.

That's why I think AI for law firms is so interesting, because you think about how much knowledge and data sets that we're sitting on. We just haven't figured out if we can use it for training yet because of all the security things and who owns that data. So that needs to be all sorted out. I agree with you. So the way I kind of think about AI for legal is there's really three tranches of AI use cases right now. The first and most basic is what I would call like efficiency or productivity tools. We see a lot of Microsoft copilot, help me draft an email, help me summarize this document or this meeting notes or what have you. But that's kind of basic productivity. The next area as we go up the value chain, I would call legal adjacent work where you're like able to extract metadata from maybe a contract or you're able to do some research using AI tools. It's not truly practice of law yet, but it's stuff like kind of around the practice of law. Then you get to the stuff that you were talking about where the complexity it's like the actual work that lawyers are doing day in and day out. There's so much promise, so much potential there. I haven't seen it at the level that we need it to be yet to really change the game. Now I'm 100% certain that it's coming. And it's just so interesting. This evolution of AI and what it can do is not linear. It's like a step change that happens over time. So I think we're all kind of watching, waiting, getting ready for that step change to come where you wake up one day and it's a different game. But I agree with you kind of day to day, we're not quite there yet. The data sets exist. Can we train the model and can the models get good enough? I'm very excited about the potential, but not yet.

I think you guys are also sitting on another data set that could be interesting to clients. I mean, I think the, the emails that Brad and I least like trading are the hey, I'm working on the budget for 2025 or where are we on the IPO budgets? Right. Like obviously that's one of my jobs as the general counsel. Now that we're a public company, it's even more important and the spend can get quite expensive. So you have all of these different clients. You've taken lots of companies public, you've done lots of M and A deals, you've done lots of litigation deals. You probably have a lot of interesting data sets. When a client comes to you and says, we just got a lawsuit filed in the Northern District for trade secret misappropriation and violation of a non solicit clause and an employment contract, can I get a flat fee for this or what do you think it's going to cost? You probably have a lot of data where you can come up with either interesting budgets or maybe more accurate budgets or proposals or interesting flat fee models.

Absolutely. So that's a lot of the stuff that I'm doing focused on here is thinking about one of my biggest priorities is data. I actually think that we collect a lot of data. Can firms make use of that both for our own internal operations, but also to add value to the client experience? And you're right. If we've done something, if we've seen something a dozen times, a hundred times, what knowledge can we then impart to create a better experience for you? And so that we're selling more than just legal services. It's like this whole experience knowledge bank that we're able to share with you. Yeah, it's a really exciting feature. Okay, so that's AI as you're thinking about the role of general counsel, I think we just kind of touched on this where it's more than just legal services. Are you seeing a change in the role over time?

I mean, again, I only have a limited set. I have not been practicing law for 30 years or a general counsel for multiple decades. What I have seen is, is that you're being asked to do a broader set of things rather than what you would just consider sort of like strictly legal functions. So certainly compliance is legal adjacent, but not always necessarily legal. So I'm also the company's chief compliance officer. But there's compliance stuff that maybe falls in legal, like insider trading policies and whistleblower protection stuff. But. But the export controls, not always. Like we helped create the company's employee handbook, we just sort of HR adjacent. So I think what the general counsel has been asked to do is sort of getting broader. I don't know if it's necessarily more complex. I think you're asked to do things, at least in the companies that I've been in now, sort of at a faster pace.

Yeah.

And maybe certainly because we're in the sort of Silicon Valley startup tech industry initially with fewer resources. And so whether that fewer resources is limited team, limited budget, limited time, those are kind of some of the challenges that I face on a daily basis.

So I do think it's gotten more complex though. And your roles, as I observe from the outside, have gotten much broader in scope. So certainly compliance, regulatory work, you're I think much more in the ear of the CEO or the leadership team in seeing across the entire organization. But the world has become much more complex. I mean, environments that you are all operating and competing in have become much more complex. So I think your jobs have become much more complex. Do you think so?

Probably. I'm just probably parachuted into it while it was complex. But we're global now. I think when I started we had two foreign subs. We've got five or six now in countries with vastly different legal regimes. So keeping up with that, definitely a full time job.

And so how do you think about your limited resources? When do you want to use outside counsel? When do you want to just use your own team? Because you have a team of what, several people right now?

Yeah, so we're a team of six. So including myself, we're five attorneys and one paralegal. We rely on outside counsel a lot. And I sort of think of outside counsel in two ways. One is an Extension of my own team. One of the easiest ways to convince your CEO or your chief human resources officer that you need to add extra headcount is to show them your legal bill for the year. They really are an extension of the team and they're subject matter experts. Right. So I would say both myself and my deputy GC never worked at a law firm. We have deep semiconductor experience, we have subject matter expertise in lots of different areas, but we would never advertise ourselves as a capital markets attorney or IP litigate. Right. We don't have that deep subject matter expertise. So when we need that, always go to outside counsel. And then certainly because we're global, we do use various law firms in Israel and Taiwan and soon to be China. I don't know anything about what Chinese law are around equity plans. Right. So we need to have experts in those areas advise us on how to be compliant. Basically.

I, I think your background is also super interesting because you haven't worked at a law firm. What advice would you give to a room full of attorneys?

So the one thing, you know, because I did a jd, mba, I sort of considered myself a business minded attorney because I had that mba. It took me a long time to really think about what a business minded attorney really meant. The first piece of advice that I would give is to be that for your client. And the way that I'll explain it is, anybody heard of this rental car company called Sixt X I X T? So I don't know if they're new or they're just new to the United States, but I think they've got a location at SFO and at San Jose. But their marketing line is don't rent a car, rent the car. They will rent you like premium vehicles. Right. You know, it's not the Ford Taurus, it's the BMW X Series or whatever. So to me, a business minded attorney means you don't understand business. You understand the business and the business is my company, your business.

Yeah. Right.

And so, so what does that mean? So understanding Astera Labs means understanding, okay, the industry that we're in. The semiconductor space. There is some jargon that you would not know if you've been in this space. It means at a high level, sort of understanding the products that we have, the customers that we sell to. This was like one of the biggest discussions with the bankers in our S1 was how we define the word customer. Because the people that we generate revenue from or the people that write us checks when we're given products are not typically the people that are the end users of our products. Understanding these nuances, understanding who our competitors are in the industry. Right.

What they're doing.

It differs by product line, certainly in the semiconductor space. Understanding at a high level, our supply chain, because we are a established semiconductor company, even though we sit here in Silicon Valley, we don't actually fabricate and make our chips. So we have a supply chain that's typically located in Asia, actually makes the silicon wafers, and then package these chips into parts that we can then sell. Understanding what fabless means and how the supply chain works and what those risks are inherent in the supply chain. And then I think the other big piece is understanding or getting to know the management team and the board of directors. I see these discussions a lot with general counsels about, do you allow law firm partners in the boardroom? Right. And I think it's kind of a fool's errand to not do that, because I think it's one way that the firm can get to know the business.

Yeah.

Not just the things that are being talked about in board meetings, but getting to know the board members. We've got an incredible board. We brought on three independent directors in the lead up to our ipo, but they all come from different backgrounds, different perspectives. They have different concerns, different expectations. I'm general counsel. I'm also board secretary. And so you have to provide them the information that they need. Previously was gathering information to the board. Now it's not so much that we have to go find the information. There's too much information. And so you have to, like, screen the information and only give them what they need. But, you know, for the partner to be in the room and get to know these personalities. So then when something happens. Right. Or we're at the board meeting when we're approving a board book for the ipo, or we're discussing strategy for something that's happened with the company, it's not the first time that they're seeing this person or that the person has talked. That trust and relationship is there because I don't think anybody on the management team or the board expects me to be the subject matter expert in all of these things. Right. They'll look for me to quarterback things, but the expectation is that when needed, I'll bring in the right experts. Yeah.

I want to dive in on this a little bit, because what we've heard throughout the morning session here today, and what I've heard from clients over the last two decades is I want my firms to deeply understand my business inside, outside regulatory International customers, competitors. And in that session I think someone from my table asked, how do we practically do that as lawyers? As your outside counsel, how do we other than reading, getting Google alerts, reading the news, doing our own research, how do we get in deep with you? I have some thoughts, but would love to hear to. Your thoughts?

Yeah, sure. I mean like I said, I think if you have a good relationship with your general counsel, with your client, that more often than not you're going to be invited into that boardroom. Everybody always says one of the law firm's jobs is to make the internal legal department look good. Right. If you're doing that and you're generally on the same page, I think that you'll be welcome into those things. I think Lauren and Julia are both here, but they were at Astera Labs yesterday. Right. So they in person visit. Lauren works out of the Washington D.C. office and she's a new addition to the team post ipo. But you know, her first trip to the Valley, she came to stop by the company, see the headquarters. One of our founders was walking by, stopped get a face to face introduction, a chat. He comes from a sales background. There was a five minute conversation about the company and what we're doing and the exciting things that are happening. Right. You're going to learn something in that conversation. I think not being afraid to ask questions. I mean to be honest, like if I had more time in my day I go to outside counsel all the time and ask for advice. I typically I'm getting an answer back and then executing. But if I had more time, I would love to just have a beer and ask a little bit more about why was that? Right. How did you get that? Just so I can learn as an attorney. So no issues from me if end of a board meeting or at a lunch catch up. Hey, at this board meeting, VP of sales was talking about this thing and he kept using this weird thing, you know, attach rate. What does attach rate mean in a semiconductor? Like I didn't quite. Right. Like I would love to educate you on that. Right. Because it'll help you understand our business. So. So don't be afraid to ask questions to learn the business. Yeah, I think that those are probably some practical things you can do.

So you said it earlier, get to know you, the team, the business before you need to make the call, before you have that issue so that you have that comfort level and you don't have to start from scratch on the first conversation. Right. So that's one thing. So we think about like how do you get there? How do you develop that relationship? I was in a room full of general counsels and clos last week and we had this discussion and I wanted to share some of the tidbits they shared. One of the GC said, our law firm folks said, can we just come to your office and sit next to people for the day and just absorb what's going on and hear conversations. Oh, your team's having an all hands. I'd love to just sit and hear what's going on, even if it's not relevant. Just to absorb your culture, know how you guys communicate, know what's going on, what's top of mind for you. And again, the general counsels were ecstatic that the firm wanted to come and spend time and learn. Of course, it's not billable time, but it's like an investment in the relationship. So like your reaction to that? Would that be annoying? Would that be like, please don't call.

Me all the time, love it, 100%.

All about it and be proactive. Right. That's the other thing I hear from every client. Tell me that you hear something that's interesting to me. Tell me you worked on a different client that had a similar issue and I should be looking at that. I should be thinking about that. Like, here's a industry report you might want to look at, page 15, because there's something related to your business that you might want to look at. These are things that as I talk to clients, they say, if you spam me 50 times a day with useful information, I still want more. Right, so you're agreeing?

Yeah, I totally agree. We were talking about this backstage a little bit. I think it also helps you build sort of deeper relationship with the firm. I was thinking about this last night and we were talking about this a little earlier. So I see lots of these familiar faces. I don't want to brag on my resume, but I think I have a pretty remarkable Goodwin resume. So Craig Schmitz and Michelle Knuth were the relationship partners and did all of the financings at Innovium. Fred Streamman, litigation partner, led our bet the company litigation Innovium. Craig Blut on the employment team helped me exit founder. Justin Smith and James Ding helped us sell Innovium for $1.1 billion. Jake Osborne did all of our CFIUS filings at Enovium. When we took international investment. I did two tender offers with Jamie Hutchinson, Brad and Julia Riley. And Nikki took us public. Lauren Visick now helping us as a public company. I'm on The Phone all the Time with Monica Patel, both at enovium for 280g stuff and now for exec comp and CDNA stuff in our upcoming proxy. Nicole Cesari helped us with shareholder issues that we were having. I think Kevin is sitting over there. We have conversations about commercial agreements and licensing all the time. So if I have an issue that's not corporate related, it's good to know that other partner or associate that I can pick up the phone and call because it'll help me resolve this sort of issue quicker. I think to your point, it helps me be proactive rather than reactive if I have a relationship with these people already. I think the caveat to that is that I don't want to be sold unless I ask for it. Now I will ask for it. If we're considering doing an M and A, I may ask Brad and the team. Hey, come pitch. We want to hear what your pitch is for this. Because sometimes you're hiring the firm, sometimes you're hiring the partner. Sometimes you've got to make sure the partner and the firm match the matter that you're trying to solve for. And Goodwin is a great fit in many. In most cases, but not every case. There are some things that could be Internet and just doesn't work. So if I want to be sold, I'll ask for it. But if we're having lunch or you're thinking, hey, all of my public company clients at some point have needed X, this is probably coming. It may not be this year, but it'll be next year, I'm gonna do it. I'm gonna invite so and so to the next lunch just so you can meet. Right. There's no not selling anything, not pressure, just, hey, this is this guy. This is what he does. You may see this. I love that too.

So that's exactly it. And I think that's a great point because for partners, I think there's often a fear of feeling like you're selling. And so I hear all the time.

Look, the client knows I'm here.

They know what I can do. They know what we can do as a firm. They'll call me if they need me, but I don't want to bother them. But on the other hand, what I'm trying to encourage folks to do is be more proactive and picking up the phone or sending the email with that helpful information. Making the introduction to other folks on the team as a helpful introduction, does that feel like selling or does that actually feel proactive in a way that you encourage More of it.

I would encourage that in almost all cases, part of it is getting to know the business right. And so knowing those right introductions and things to make the thing that's most helpful for me and I mean, we talked about this yesterday when Julia and Lauren were at the office is helping me see a round corner. So that's. I would rather be proactive than reacting to an emergency.

Yeah.

We filed our S1 as an emerging growth company. I think assuming things continue in the same trajectory and sometime in 2025 when we have to measure it, we will no longer be an emerging growth company. We'll have to file as a large accelerated filer when we do proxy in 2026 for the calendar year 2025. And so some of the decisions that we're making now is we put compensation regimes into Place for 2025 will have an effect at the end of the year when we go start to write the proxy and the annual report and all of that. So better to sort of get ahead of it now and think about that before we're at the end of the year and it's a fire drill or an emergency. Meta and Google probably deal with like data privacy issues all the time. Like, data privacy is like not the number one concern that I have. Right. We're not collecting consumer data, customer data. We're not dealing in that. I don't need an email about. Let's review your data privacy policy. It's helping me see around corners. It's understanding the business. But I think the general counsel still is sort of pulling the trigger on what the priorities are.

How do you think about your relationship with a firm versus with a whole bunch of separate partners? And you rattled off like a laundry list. I mean, you're working across multiple parts of our firm. It's very deep relationships, as we can see. Talking to some other clients who have like big companies with hundreds of of firms that they work with, it feels like there's a shift towards building deeper relationships with individual firms so that they understand the business more. And a lot of them are focusing on, let me have less firms, but these deep relationships rather than a partner here, a partner there. And does that resonate? How are you thinking about that?

I do. I generally agree with that. I mean, there certainly are synergies. And so I think all of those things that I just rattled off emanate from this sort of like core corporate foundation. And so all of those other things. There is a synergy. If I can use the CFIUS team in Washington D.C. for a filing in conjunction with the series D where I'm also like, wouldn't make sense to go to somebody outside of Goodwin when Goodwin is then also doing like that financing if we get a shareholder derivative claim or whatever. Right. Goodwin was helping in the preparation of all of the corporate public filings. So probably makes sense to at least consider the Goodwin litigation team. Right. There's lots of synergies that I think make the work more efficient. I don't love the high rates, but you get more policies from your insurance company, you get that like multi policy discount. Right. I think that there's creative things that the firms will do when you're giving business across multiple matters, which is always great. Goodwin obviously has lots of firms here in the Valley have Tier 1 Premier name recognition. Obviously when you have especially early investors that are coming from these respected Silicon Valley VCs, demand that your counsel is of that caliber. But once you get beyond that, and this is why the relationships are so important, it really is the people and not so much the firm name. Right. So if there was an M and A or a litigation matter or something that I was bringing in, it's the CEO and the CFO and even my legal team. It's never like hire Goodwin the name. Right. It's we've brought this person in from Goodwin and this is the right person for that matter.

Yeah. Okay. You touched on the rates. I want to get in a little bit to the billable hour. AI technology. Thoughts on the future of what AI and tech and the model and all the disruption we're feeling and the ecosystem is going to do to the future of a law firm. Something I think about all day. Do we disrupt the billable hour? Are we there yet? How are clients thinking about this?

So caveat that you're coming from a guy that couldn't do the billable hour. I did actually do two law firm internships when I was in law school. And the other way it was not for me, I couldn't do it. So hats off to you. I have heard for a long time there's always these articles about sort of the death and the demise.

Like 20 years.

Yeah. Of the billable hour. So I don't know if I believe that it's quite there. I certainly think that AI has the potential of making things more efficient. So you're billing less time per matter, but now you're able to take more matters. We talked a little bit earlier too about the data sets you have and some creative flat fee models. I don't think it's any Secret like Goodwin has a public company flat fee model. That's great for us. We're using that. It gives our finance team predictability and what we're going to bill each quarter gives me predictability in creating the budget. It's very easy to do. I think the workload is predictable. So as a client, I love that.

Predictability is really important for a client. Even if you are using the billable hour. I can't emphasize enough how much communication on where you are against the budget and the bills is so important to a client.

Totally. The practical implication as a private company maybe not as important. But I've just seen it now in the shift to being a public company. It's if you're only billing 30 or $40,000 a month and it's like the last day of the quarter and there's only five days left and you're trying to get a sort of readout on what we need to accrue for so we can close the books and we're off by a couple thousand dollars at the end of the day. Like it's not that big of a deal. We like to be as close as we can. But I mean there were periods with goodwill when we were billing hundreds of thousands of DOL a month. And in the lead up, some of these filings, like a three or four day period could be a giant bill. Right. And so when we go to close the books on a matter like that, if I tell the finance team that it's going to be X and it comes out as X + $400,000, it's a conversation I have to have with the controller and the head of FP&A and the CSO about why there was a miss. So predictability is like hugely important. And yeah.

And you don't want to have that conversation. So everything that we can do to help you not have to deal with that is really helpful for sure. As we think about client value. So the rates and everything is one piece of it. The quality of work is another one. And this has kind of been like the age old question in the profession. How do you measure quality of legal work? I don't think anyone's cracked that nut yet. Do you think about that? How do you know that the work is good when you're comparing across either your internal team, your external team?

Yeah, so that's a very, really interesting question. I come at this from maybe a unique perspective. So I think I mentioned earlier that one of the jobs that I had, I was in the Navy was not just Being a Navy pilot. But I worked in a maintenance department. And so in that maintenance department, I was the quality assurance officer. The job of the quality assurance officer is reduction of the occurrence of defects. And so how do you measure that? You definitely don't want to take the reactive approach, right? Because for a long time there had been this sort of like, hand waving or throw your hands up approach to aviation mishaps where it was this Swiss cheese model of, oh, things just aligned and you put these things together and it slipped through the hole. But if that's your philosophy, then you're kind of like, always reactive. But there had been a lot of work. It was actually a guy that wrote a book called Industrial Accident Prevention. He worked at an insurance company in the 20s and 30s, and he went back and looked at, like, all of these claims this insurance company did. For every major accident, there were 29 minor accidents and 300 incidents that didn't result in damage but were quantifiable. And so you sort of chart that and it becomes this iceberg or this pyramid. And so in the aviation perspective, right before a wheel falls off of a United jet in the parking lot at sfo, I guarantee you there was several incidents of maintainers not returning their tools properly. There were probably several incidents of pilots not doing walkarounds of the jet. There were probably several Runway incursions, right? All of this stuff leads up to this incident that causes damage or loss of life. So the way that I think about now, quality of legal work is I need to get involved when I start seeing these minor defects, because in my mind, it could rise to the level of major defect. Let's take signature pagers in a series financing. If we update signature pages for the series C, and then we get signature pages for the series D and the updates didn't follow through, that's just like one piece of evidence of a little miss. But if there's a little miss there and then we ask for something by Thursday and we don't get it until Tuesday, then there's another little miss there, and then we get something. And a piece of feedback wasn't incorporated then. Now maybe it's a conversation with the senior associate or the junior partner about, hey, I've noticed a couple of these things. Everybody makes mistakes, but we've got to have open communication. The only way to get zero defects is to not do any work or not do any business. When you start aggregating a bunch of those little things, now it's time to have a conversation. So we don't Have a big thing.

Yeah. So many thoughts to react to. In our last session, one of the moderator had posed a question to the clients about what sort of destroys a relationship with your law firm. One of the responses was it's a slow erosion over time of the trust. Like the little things that add up. I'll share with you. We did an interesting study when I was at Google to see if we could figure out how do we measure quality in legal services. So anyway, I thought that was interesting. Other thread I wanted to pull on.

Can I just stop? Yeah, because I think that's really interesting. So I guess maybe table stakes is like quality of the legal work. Yeah, right. Like you can't be giving like wrong.

And I think that's exactly right. Yeah.

But a little bit of what you were talking about was like quality of the service. Yeah, it's a little bit of a nuanced difference. And so for sure I agree with that. Like responsiveness is important. Even with my own internal legal team. Shorter emails. So I don't necessarily have to go line by line of a nine page document or 30 page document. Like that's great. The other thing too is that sometimes if I'm asking things on email, it doesn't always, especially if it's like sort of complex, it doesn't always require an email response. So feel free to like pick up the phone and call. Sometimes that prevents follow up the back and forth on email. We can just have a 10 minute conversation and resolve something. So that's certainly important. It's gotta be a two way street. You've gotta be a good law firm, but then you also have to be a good client. Yeah, I'm sure that can probably be delicate feedback to give. But I liked the opportunity after the IPO to sit down with Brad and Julia and we had lunch and it was like what did we do good? Right. What did we learn if we could do it over again. Are there any things that you would like to see tweaked? Great. Because we have both positive and constructive feedback. But the flip side, and you hope that you work with clients that are doing this. What can we do to be better clients? So then you can give us better services. That's probably one of the things that maybe I have thicker skin from being in the Navy. Every time I got back from a flight, every landing was graded and every flight was debriefed. There were no perfect flights, there were no perfect landings. And so I try not to call at 9:00 clock at night or 6:00 clock in the morning. I know people have families. Unless somebody's calling me at six o' clock in the morning or nine o' clock at night.

Right.

And it is time sensitive and we need an answer. But I recognize my own limitations. Kudos to everybody that worked with me on the ipo. Right. This was my first time. I probably am a bit of an acquired taste of somebody to work with. So sometimes the tone doesn't match the appreciation that I have for all the work that people are doing. So any feedback that you can give your clients, to the extent that they're open to receiving it, I think is also great too. Yeah.

And to be real with your client and really transparent and honest about what could be better and what could the client do better? Clients want to know these things. They don't just want to be pandered to. We think about the lawyer of the future. Again, I'm going back to your background, which I love. What pieces of being a Navy pilot or having sort of a business mind do you bring to the role? And how do you think it helps you be a better lawyer?

Oh, so that's good. So there are days that I go to work as general counsel that I feel like I don't really do any legal work. It really is project management, dealing with people issues, interacting with a management team. I think the general counsel of today is, like, embedded within the management team and the C Suite. Certainly. I think the ability to project manage is a lot of what I do. And it's a lot of what I did in the Navy. I did a lot of leading diverse teams. The Navy is a pretty diverse organization. Our legal department's pretty diverse across multiple spectrums. So I did that. I think we were chatting backstage. Like, one very tactical thing that every pilot uses in the Navy is a checklist. And I draw on this checklist thing. And I think we've both read this book by the Stanford Dr. Atul Gwande called the Checklist Manifesto. And so I do. I have all of my old pilot checklists. And so I'll pull out this checklist. And I showed them that and then showed them this book. And then the next checklist that I pull out is the Goodwin IPO checklist of the things that you need to do 18 months prior 12 months prior 6 months prior who's responsible. It's like a great way to be organized and stay on your job.

Yeah, it's amazing. So when I was at Google, our general counsel, now clo, Kent Walker, we were in a leadership team meeting, and someone Asked him, if you had a book that you would recommend that all of us read, what would it be? And he said, the Checklist Manifesto. So I promptly ran out and read that book. And it's a great book. I recommend it to everyone. It really talks about how everything can be structured, even something that you think you couldn't possibly. It's different every single time I do this. To your point about how do you avoid errors? It's all the little things that add up. And if you have a checklist, even if flying a plane, you could have a checklist for surgery. The reason surgeries are like safe now and we don't all get infections is because there is a checklist. So as we go about our jobs as lawyers, are there things that can be checklisted? And that sounds really structured. And you know, everyone says, well, it's different every time and it's bespoke. It depends on the client and depends on, but there is, I bet, a bunch of things as I come at it from a legal operations perspective that can be standardized, that can be thought through and that will prevent errors, will create consistency, a better client experience. Yeah, I mean, I love that perspective.

Yeah, it's a good way to self impose discipline if you force yourself to go through a checklist. I mean, that was one of the pieces of really great positive feedback that my deputy GC and I gave to the Goodwin team of just how great we felt like the IPO checklist was and the way that they sort of managed it and kept us on track. Six months out, we sort of put this dart on the board of we want to IPO on this date. And I think we hit it within two or three days. So that was pretty amazing of staying on the checklist. And I've got a, a college age daughter that has to write English papers. And guess what? There's a checklist for how to write an essay and how to proofread. And you know, how many times did you do this and spellchat?

Right.

And so there's checklists that you can use all the time.

Makes you better. I'd love to open it up to questions. I mean, we were welcoming them. But does anyone have anything they'd like to ask or share?

This has been a fascinating conversation. So thanks very much, Phil for taking the time and Mary for leading us through it. Phil, you hit on one of the things that I always thought was really unique about Astera's culture, which is a commitment to younger folks getting opportunities. So you mentioned the college intern program, which I understand is really important to Jitendra and Sanjay, the two founders of the business is important culturally for that. Maybe you could tell the audience a little bit about what you did with our summer associates this year. We had some summer associates that came to Astera and did a project. And then maybe just there's a lot of junior associates in the room. Maybe some encouragement from you about why getting those opportunities to stand up in front of a client and be the one delivering the work product can be really important. And the importance of practice.

For sure. Yeah. I don't want to sound like I did this because I was so magnanimous and wanted to give Goodwin Summer Associates great projects. I also think I didn't get billed for it. So that's positive. Positive for me. But I mean, look, we are a new public company besides the cfo. Most people, I mean, CEO, coo, the key decision makers running Astera, have not been in those jobs before in a public company. And so I would say we have a junior but learning and growing public company reporting apparatus, both in the legal department and in the finance department. And so at the beginning of the summer, when I knew summers were going to come on board, I chatted with Julia and said, hey, are you open to any projects? And she said, sure, we've got bandwidth. What are you thinking? I said, hey, it would be great to just have somebody sort of go through the list of when an 8k is required. Just so legal department's on the same page of finance department. We've had a chance to sort of walk through it, maybe give us some examples. Right? Here's our peer companies. Go back and look at the last five or six years. Are there any outliers that they are filing that you're like, oh, we haven't seen this one before. And so maybe, you know, if Astera runs into the same situation, we may have to file this one and have them put something together. So when we're ready to file an 8K and we send you something to review, we have at least thought about it and have a good starting point. So the first call is not the good one to maybe help us create it. So they worked on it during the summer. We had some intermediate touch points. And then at the end of the summer, two summer associates and Julia and Riley, four people. And then. But then Julia and Riley just sort of like sat quietly in the corner while the two summers presented their project. And they presented it to me, the cfo, deputy GC controller, assistant controller. And then like our public reporting finance woman Definitely some senior people in there, and we got to ask questions, and then we were left with some work products. So it was great. But I think that's the first part of the question was just sort of what we did for the summer interns. And then the second part was what advice to junior associates. Any opportunity you have to get in front of the client, I think you should absolutely take. Nobody has all of the answers. I mean, I get asked questions all the time, and I just will look at the CEO or the CSO or the COO and say, yeah, that's really interesting. Like, let me think about that for a minute and I'll get back to you. So. So don't be scared of going in front of the client. You have to always have all of the answers. It's fine to sort of say that. I think if, you know, you do your preparation and work or whatever, you'll be able to answer 80 or 90% of whatever's thrown at you. But the ability to stand up and do that, to the extent that you're. Wherever you go in your legal career, whether you stay and become a partner, you're going to have to do that to pitch and win business, to build these trusted relationships. And to the extent that you move in house, you're going to have to get up in front of your legal team and do that. So highly encourage you to seize those opportunities whenever they present themselves.

So if we think about AI, how is AI changing the profession and what it means to be a lawyer of the future? We talked a lot about being subject matter experts, and that in my view, there's kind of been two parts of being a great lawyer to date. Being a deep subject matter expert and having really great judgment. AI is going to help you with being a subject matter expert. And in fact, that becomes less of a differentiator as an individual because we're all going to have access to that same amount of deep subject matter expert. The judgment can't be replaced by machines. And I think that becomes more and more important as we move on.

Yeah, look, I don't want to get phased out of either of these jobs, but just so you know, like, there are autonomous airplanes that are landing on aircraft carriers now. Right. So there's a big thing of like, are we going to phase out naval aviation? But. But there is like a judgment piece, and then there's this like, ground officer piece of you have to have a pilot be the quality assurance officer in the maintenance division, because they're the ones that are, like, ultimately accepting the the airplane for delivery. So I don't think that you'll ever see an aircraft carrier that's full of just autonomous aircraft, because you can do that stick and rudder stuff. That's subject matter stuff. But there is this judgment piece that you may never get. And I think it's the same on the lawyer side and maybe even more once you go in house that the judgment and the counselor piece, it's not more important, but it's maybe what you do more of. I definitely am a generalist. I'm not a subject matter expert by any means. So I feel like a jack of all trades and a master of none. Definitely. In the near term, I don't see how AI will replace the judgment or the counselor piece.

Right.

Yeah. And those. When you get to that management level, I think that's the piece that they. When you're asked a piece of advice they want, it's not always the right answer because a lot of times the black and white questions are easy. Yep. Right. It's the operating in the gray area, the creativity, and it's understanding the business and how much risk are we willing to accept and how far into the grade do we want to be? And that's where the judgment piece comes. Of the acceptable right answers. There are lots.

Yes.

Right.

And how to get there.

And you got to figure out how to get there. What's the acceptable right answer of the company? But in order to get that decision implemented, you have to have built trust that, though, and the CEO have to trust in that judgment and counseling that you're giving. And then maybe the next piece, and this is maybe one thing we didn't mention earlier of maybe the difference between working in a firm and working in house is that a lot of what I do, even when I go to outside counsel with a question for an answer, is that I get the answer, then it doesn't stop there for me. It's like, how are you going to execute and then implement that answer? Right. And so people nod in a room and say, okay, we agree with that. Go make it happen.

Yeah. So I think it's so interesting that, like the 20 years of experience that allows you to make that judgment or give that advice starts to become so much more important. And the groundwork and the research now maybe gets automated, AI'd, what have you. That last mile is so, so valuable. And when we think about the structure, the model, the pricing, it's no longer the one hour of advice. Given that all this happened in 20 seconds. That hour of advice has a whole different value now than one hour.

Totally.

So that's such an interesting thing that we start to deal with now with that. Thank you so much, Phil. I hope you guys all enjoyed that conversation. I know I learned a lot, so appreciate your time and for being here.