This article first appeared in the June issue of the Orange Rag.

June saw the launch of US law firm Greenberg Traurig shared services subsidiary Recurve, which will be a launchpad for its innovations in technology, project management, alternative staffing and solutions for lawyers and clients that don’t involve the practice of law.

While many international law firms are looking at launching this kind of entirely separate venture – beating the alternative legal service providers at their own game, if you will – it’s still in its relative infancy, and one area where the United States leads the UK.

As far back as 2011 the ABA Journal began a series of reports looking at how the legal profession is responding to its “Kodak moment”: Seyfarth Shaw, Baker Donelson, Dentons and Akerman have all launched separate ventures in which to collaborate with clients outside of the constraints of the partnership, particularly around technology.

We speak to a lot of people behind the scenes and you should not underestimate what an achievement it is to get partner buy-in for the launch of a separate venture of this nature, with all of the cultural and financial ramifications that has.

In the UK, Magic Circle firm Allen & Overy’s subsidiary aosphere has long stood out and won awards for offering subscription-based online derivatives services but is has been something of a lone island.  More recently, Clifford Chance launched Applied Solutions, out of which it will sell white-labelled document automation services, client apps and more.

A separate subsidiary is a no-brainer if you want to sell subscription-based, tech-underpinned services.  Lawyers struggle to sell their own services at times, let alone products they don’t understand.  CC, which launched Applied Solutions in 2018, is finding that it is easy to attract good people to work within that type of organisation.

But Recurve is far wider in its ambitions than either of those two ventures and almost certainly than the pre-existing ventures in the US.  Speaking at the time of Recurve’s launch, Greenberg’s executive chairman Richard Rosenbaum said that the firm’s wholly-owned subsidiary will be “utilising investments by strategic partners involved in its core disciplines and other equity investors experienced in the space to fund its capital requirements and operational needs,” adding, “Recurve is intended to become the first law firm-founded, third-party financed global collaboration platform solely focused on creative innovation in the support of the delivery of legal services.”

He added: “Recurve will work outside the traditional legal model to provide previously unavailable tools and efficiencies in the legal ecosystem, bringing together diverse talents and resources across the globe in a collaborative platform aimed at industry-wide innovation to help attorneys and clients adapt to the rapidly changing legal landscape.”

Working outside of the traditional legal model – particularly for US firms, where a lack of deregulation means less flexibility in how you structure your own alternative legal offering – means that it won’t be burdened with the costs of the partnership and can be more flexible (aka attractive) in its fee structure.

Recurve will establish headquarters in Warsaw, Tel Aviv and Denver, with operations in strategically selected locations, including Austin, Berlin and South Florida.

It will, Greenberg says, be staffed by a lean and experienced team of innovation “architects”, well versed in client needs, the advantages of the traditional law firm model and the wide array of growing resources in the legal innovation marketplace.

In addition to Rosenbaum the initiative is being led by Denver-based lateral hire Tom Romer, head of innovative client strategies at Greenberg, and Jaroslaw Grzesiak, managing shareholder of the law firm’s Warsaw office.

The ambition is to help clients use advanced technology solutions, value-based budgeting and pricing and process innovation without themselves making significant investments in people, process and technology.

You could easily argue that Greenberg might be better off creating an integrated shared services offering such as Herbert Smith Freehills and Baker McKenzie have, led by their shared services centres in Belfast and internationally.  Clients benefit from a cost-competitive, tech-led approach to higher volume work that is fully integrated with its mainstream legal practice.

The advantage that law firms can offer over established ALSPs is a natural, integrated workflow that means all of a client’s work from low to high end is taken care of at the right price point.

There is a but: if Greenberg pulls this off, they could be in a much better position when the next recession bites and corporate legal teams downsize, and general counsel look to where to send the lower value work that is currently being handled in-house.  Spoiler alert: it’s unlikely to be law firms, although firms with built in alternative legal services will be at the front of the queue.

There are a few big questions about Recurve that we can’t yet answer that will help to decide success or failure.

1) Is it really, truly separate or is there a blurring of responsibility that mean senior personnel are selling Greenberg and Recurve.  As one legal tech vendor said to us, “If that’s the case, good luck with that.”  It must also not suffer from the early Seyfarth effect, where partners gave away services to their clients.

2) What is the workflow for clients between Recurve and Greenberg?

3) Are Greenberg lawyers being incentivised to refer work to Recurve?  Recurve may be a greenfield site, but it has the huge advantage of Greenberg’s thousands of clients.

We await with interest news of any third party/VC funding, as well as a few answers.