Home » Business » Big Data » Will DIY legal tech replace lawyers?
We’ve all seen the LegalZoom commercials offering an alternative way to start a business, write a will and even create a trademark. This could mark the beginning of an exciting time for do-it-yourself (DIY) legal technology and new alternatives for those looking for legal advice.
Legal services have long been an attorney’s game, played in offices with handshakes and pen-to-paper contracts. These low-tech traditions have kept many in the dark about important laws governing contracts, loans and businesses.
Startups are taking aim at an industry valued at $400 billion in the United States alone. The numbers stack up pretty well for DIY startups to be a disruptive force in law: In fact, 50 percent of American consumers have at least one legal event per year, but only 20 percent actually get a lawyer, according to the Legal Transformation Institute (LTI).
In addition, about 23 million small businesses operate in the United States, with 7 million not seeking a lawyer when presented with a significant legal event. Those who received legal help say that they spend on average $7,600 per year, LTI reported.
These costs can be quite prohibitive for small businesses struggling to make ends meet or early-stage startups just taking off the ground. Sites such as LegalZoom and RocketLawyer offer the same services as a law office but at much lower costs. RocketLawyer offers free legal advice with the touch of a smartphone screen, doing away with lengthy appointments and $250-per-hour fees that some law offices charge.
With the rising popularity of these sites, many other startups have begun offering niche products for people looking for legal help. Iubenda, for example, offers companies generated privacy policies, doing away with lawyer charges. Other apps such as Shake help users create, sign and send legally binding agreements without the need for a lawyer.
This is a trend for the DIY legal space, offering consumers legal advice without actually needing to know anything about the law. Herein lies the problem for the DIY legal system: Can we replace lawyers if consumers aren’t learning the law?
One of the biggest draws in the DIY legal app world can actually be quite problematic. The freedom to create and customize wills through LegalZoom and RocketLawyer, for example, can help lower overall legal costs, but there is a chance that a user can create contradictory clauses, which would require the use of lawyers and paying legal fees down the road.
Another issue is that these websites and apps offer the most basic services for consumers and businesses, but any kind of complicated legal question will still require deferring to the experts. Some of the more nuanced issues in fields such as intellectual property or contract law could require thousands of dollars and numerous lawyers.
How can DIY legal services work around this while still disrupting the legal field? Many new websites are marrying technological advancement with the legal know-how of a trained lawyer. SvPerbar is a website that incorporates legal advice into a product. Need a consultation for U.S. immigration options? That’ll be $150. Need to file for Chapter 7 bankruptcy? You can do it now for $1,200. The website connects consumers to legal services from licensed lawyers by state at flat rates.
Consumers will have the peace of mind provided by flat rates while getting advice from educated lawyers.
Other startups such as Hire an Esquire and PrioriLegal are helping consumers find lawyers at off-market prices.
We may not be seeing an end to traditional lawyers and legal services, but we will be seeing new ways for consumers to leverage technology and get the most value for their money when navigating legal questions and creating legal documents.