On the Sofa with Mike Lynch, founder of Invoke Capital
Mike Lynch has been described as Britain’s Bill Gates, having in 1996 co-founded global software giant Autonomy, a spin off from computer finger print recognition firm Cambridge Neurodynamics.
Lynch served as Autonomy’s CEO for over fifteen years, during which time it became one of the UK’s most successful technology companies listed on the FTSE 100, acquiring companies including email archiving and litigation support company Zantaz for $375m, Interwoven (now iManage) for $606m and eDiscovery provider Iron Mountain Digital for $380m.
With the dispute over Autonomy’s $11.7bn sale to HP rumbling through the courts, Lynch has gone on to found and lead Invoke Capital Partners, a machine learning and artificial intelligence investment and advisory company, which helps entrepreneurs develop their ideas and bring them to market.
Invoke Capital’s early investments include Luminance; a machine learning based due diligence tool launched after a collaboration with elite City law firm Slaughter and May; and Darktrace, a next gen cybersecurity tool being used by firms including Irwin Mitchell.
Legal IT Insider caught up with Lynch, a keynote speaker at Legal Leaders IT Forum in Gleneagles in March 2017, to find out his views on what changes are coming down the track for legal and how firms should be preparing.
“I have a lot of experience in the legal sector because in a past life Autonomy owned iManage and Iron Mountain Digital, one of the largest eDiscovery players, so I’m very familiar with what is coming into legal.
Machine learning takes it up a level. At the moment, systems spot key words or match exact clauses but they can’t understand meaning or look for clauses you didn’t know you wanted to look for. The big issue in due diligence is that you don’t always start out knowing what’s strange.
In the same way that driverless cars have the ability to learn from the world, once you have that intelligence, you can apply it to a very large amount of documents.
The thing to understand is that this is just the beginning. These new level technologies will move on to negotiating contracts. We’re seeing the beginning of a new discipline and lawyers are still very important but for the creative input not the slogging.
Banks do large volumes of very standard derivatives work where it is already moving away from a lawyer-led operation. You can now use machine intelligence to pick the clauses and optimise the negotiating process.
In the same way as mathematics now maximises website sales and Tesco knows what you need to see on the screen to get you to buy their products, mathematics can be used to draft a standard contract.
What you see of machine learning now will soon be like seeing a television from the 1950s.
The most important thing to remember with technology like this is that there will always be people who prophesise doom, but while it was obvious that purchase ledgers would be replaced, people could never envisage that new jobs would be created.
It’s certainly true that the two professions that are the most cautious are legal and medicine, where the value is in the practitioner. But the reality is that the legal profession needs to understand where it adds value and you can’t avoid any more the idea that having very highly paid lawyers reading millions of unremarkable documents is a very bad idea.
The sector is seeing changes in pricing that are driving efficiency, which also means that new technology has to be adopted.
Law firms have been reticent in the past to adopt technology partly because of the law firm culture but partly because the technology needed to be good enough.
What’s exciting is that, not that long ago, a case was about going to a filing cabinet and putting the correspondence on the table. Now we’re in the age of terabytes of data and contracts that have to be created in real time. If you put it all together, we are seeing huge change. The business model is definitely changing and the successful firms are embracing change.
Firms just need to focus on where they add value, not the handle turning bit. The drivers are now very strong; the clients want to see efficient, rapid handling of these large amounts of information.
I would learn the lesson from the industries gone before – music, media and retail. The first thing to understand (good law firms do already) is that the world tomorrow is different from the world today. Second, is to work out what those differences are and where you want to be, and map that onto your own roadmap. Don’t put your head in the sand, there is great excitement to be had if you embrace change. It is the people who are thinking about the future, about what legal services will look like, who will be the ones that do well.“
This article was first published in the November Legal IT Insider newsletter