Chris DeConti, Global Head of Banking at Axiom, said: “Axiom is delighted to partner with Ashurst as the first partner in a new model of working with law firms to provide our clients with a comprehensive solution that includes world-class legal advice and legal enforcement capabilities. We look forward to announcing more partners in the future. When Axiom announced its intention to go public in February, it was a historic moment for New Law, as the revolutionary flexible law firm established itself as the industry`s largest global brand. In 2013, an enthusiastic commentator predicted that Axiom 2018 would be the year Axiom became the world`s largest legal provider (spoiler alert, it would still not be part of the Global 100). Today, Axiom has also established two of its companies, Knowable and Axiom Managed Solutions, which provide enterprise contract information and solutions for complex legal work. As part of its first partnership with a law firm by the legal technology provider, Axiom will use its technology to extract key data from documents and create new documents in accordance with changes to margin of variation rules and derivatives requirements set to take effect in 2017. It also follows a series of UK legal transactions in recent years, most recently with BRITISH law firm DWF, which plans to raise £75 million on the London Stock Exchange next month. Prepaid Legal Services, dba LegalShield, provides LegalShield members and their insured family members with access to legal services provided by a network of provider law firms through membership-based participation. It follows the restructuring of BT Retail last year, which split into two divisions, BT Consumer and BT Business, and the reorganisation of its legal teams.
The three simultaneous announcements of 19. February 2019 raised several questions about Axiom: (1) Why has the company derived its technology and managed services branches when the market is increasingly technology-ready and investments in legal technology are at an all-time high? (2) Why did Axiom hire Elena Donio, a technical executive with no experience in the legal industry, to divest itself of its core technology unit a few years later? (3) Why would Ms. Donio, a highly respected technology executive, choose to stay in Axiom`s talent company after the spin-off? and (4) What is Axiom`s business model that is about to be offered to the public? Chris DeConti, Chief Revenue Officer of AMS, commented: “Both Knowable and AMS demand and deserve the focus, capital and leadership energy that come with independent growth companies. Independence will also allow us to seize unique opportunities and better serve our clients, with effective guidance, dedicated management teams and tailor-made investment strategies. In 2014, BT selected Axiom for its global legal outsourcing and analysis for a three-year contract, with Axiom tasked with executing 30 to 50 instructions per day in Europe, the US/Canada and the APAC region, ranging from simple work such as non-disclosure agreements and initial contract mark-ups in tenders to more demanding work such as end-to-end negotiations of services and product and service agreements. A 2012 New York Times article covering the legal landscape after the financial crisis concluded that “a broader transformation may be imminent. And this can look a lot like the law axiom. Axiom had 900 lawyers, a number of impressive corporate clients, and a new organizational and economic model that fit well with the austerity policies of the time. Mark Harris, the founder of Axiom, noted that “the interests of law firms are shifting from client service to self-service.” Legal consumers didn`t care if Axiom was a law firm or a talented law firm. For Axiom, this was important because: (1) as a talent company, it was not subject to capital investment restrictions affecting law firms; (2) Management and high-performing lawyers/specialists could acquire (residual) equity in the company; and (3) the transfer of risk from Axiom to the customer provided an additional cost advantage over the companies that retain the risk. The benefits of traditional publicly traded law firms have long been debated, but new law firms like Axiom have generally been seen as more compelling investments, especially as technology and automation turn more institutional legal services into evolutionary processes. An innovator who has long been at the forefront of transforming the traditional in-house legal function, BT entered into a three-year agreement with Axiom in February to provide the telecom giant with legal outsourcing and analysis services in the UK, US, Africa, Middle East and Asia, replacing and renewing a contract previously held by legal process outsourcing (LPO) provider UnitedLex.
The service, dubbed “BrexitBridge,” has been designed specifically for in-house legal teams and will incorporate artificial intelligence (AI) to help companies update and rewrite their contracts, which they begin with one of the largest contract renewals ever undertaken. Eyebrows rose when Axiom invested in a managed legal services company in 2015. This raised questions about Axiom`s positioning in the market and whether the new business unit and subsequent digital contracting activities were related to the company`s core talent/resource model. The chatter intensified in November 2016 when longtime founder and CEO Mark Harris, the face of the Axiom brand, was replaced by Elena Donio, a seasoned tech executive but new to the legal industry. Questions about Axiom reached their climax on September 19. February 2019, when spin-offs of Axiom`s Enterprise Contracts Intelligence (Knowable) and Axiom Managed Solutions (AMS) divisions were announced. Axiom`s remaining legal talent business also announced plans to go public. It is now in a quiet period, an embargo on advertising ordered by the SEC. The imposed silence has fueled speculation – and doubts – about Axiom`s future. The conviction of buyers, especially the conservative attorney general, was a higher obstacle, especially when Axiom began at the turn of the millennium. The legal market was then very different from what it is today.
Law firms were the dominant supplier in the industry, and their hierarchical partnership structure, leveraged business model, and closed culture linked to precedents were major hurdles faced by Axiom or any other provider that introduced a new delivery model. Law firms had a virtual monopoly on the supply of the best legal talent, and they played the talent card to justify the ever-increasing rates. Axiom recognized this and mitigated the quality problem by hiring lawyers from large firms and removing escalators from the traditional model – partner tributes, lavish offices, overcrowded staff, etc.