Will Law Firms of the Future Be Run Like Tech Companies

Can You Run a Law Firm Like a Tech Company?

Introduction

Law firms and tech companies operate on fundamentally different business models. Traditional law firms are built on billable hours and incremental, linear growth, whereas tech companies scale products to a broad market with exponential potential. This disparity raises a provocative question: can a law firm be run like a tech company?

In an era of rapid innovation and AI-driven change, law firm leaders and LegalTech entrepreneurs are re-imagining what a “law firm” could be by borrowing the playbook of Silicon Valley.

This article explores how tech-company practices - from investment and revenue models to talent strategy and marketing - might be applied to the legal sector. The findings point to a future (by 2030 and beyond) where the most advanced legal service providers look less like traditional partnerships and more like technology-driven, productised services companies.

Investment Models: Venture Funding vs. Partnership Capital

How Tech Does It: Tech companies fuel growth through aggressive investment and long-term capital. Venture capital and public markets pour enormous funds into promising tech ventures - for example, global venture investment hit a record $621 billion in 2021. This capital is used to hire engineers, develop products, and capture market share before turning a profit.

Top tech firms also relentlessly reinvest earnings into R&D; the five biggest Nasdaq tech companies together spent over $229 billion on R&D in one recent 12-month period. Amazon famously didn’t turn a profit for years, instead plowing cash into innovation and customer experience - a philosophy of “focusing on customers, not short-term profitability” as Jeff Bezos put it.

This long-term ownership mindset (often encouraged by venture investors and equity-holding founders) tolerates short-term losses for future upside.

Reimagining a Law Firm: Traditional law firms, by contrast, have relied on partner capital and yearly profits. Under the typical partnership model, growth funds come from the partners themselves or bank loans, creating a bias toward withdrawing profits annually rather than investing in the business. This can foster a short-term outlook, since senior partners nearing retirement have little incentive to invest in initiatives whose payoff extends beyond their tenure.

To run like a tech company, a law firm would need to embrace outside equity and long-term investment. Notably, this is already happening in some jurisdictions: in the UK, firms have been allowed external shareholders since 2011, and over 1,300 law firms have adopted Alternative Business Structure models to take on non-lawyer investment. A handful have even IPO’d on the London Stock Exchange (e.g. Gateley in 2015 with a £140 million valuation).

With patient outside capital, a law firm could invest in scalable infrastructure - for example, funding new technology platforms, automation tools, or acquisitions - without starving the partners’ wallets. Access to permanent equity shifts the dynamic: the firm can pursue multi-year growth strategies, hire non-lawyer technologists, and develop new services, instead of focusing solely on immediate billable work. The result is a more corporate, long-horizon business model.

Once a firm goes down this path, it starts to resemble a LegalTech startup or “law company” more than a traditional partnership. The infusion of venture-style capital essentially transforms the firm’s DNA, requiring governance that balances investor expectations with professional standards.

Commercial Models: Recurring Revenue vs. Billable Hours

How Tech Does It: One of the crown jewels of tech business models is recurring revenue. Software-as-a-Service (SaaS) companies like Salesforce and Spotify thrive on subscription fees, turning one-time sales into steady monthly income. This provides predictability and scale: a great product can be duplicated for each new customer at low marginal cost, allowing revenue to snowball. Investors greatly value this stability - recurring revenue is considered “higher quality” income, often earning SaaS firms valuation multiples many times their annual revenue.

Salesforce derives virtually all of its $32 billion+ revenue from subscriptions. Adobe moved from selling boxed software to cloud subscriptions, vastly increasing its lifetime customer value and stock performance. In short, tech companies focus on productising services and locking in long-term customer relationships.

Reimagining a Law Firm: The traditional law firm revenue model is transactional and human-labor-intensive. About 80% of large law firm fees still come from billable hours, meaning income is tied to time spent. This model inherently caps scalability: a lawyer’s day has only so many hours to sell, and efficiency can perversely hurt revenue if you bill by the hour.

To adopt a tech-like commercial model, a law firm must decouple revenue from hours. This could mean offering subscription-based legal services or fixed-fee packages that resemble SaaS contracts. Forward-thinking firms are already experimenting here - for instance, some boutiques offer unlimited legal consultations and document reviews for a flat monthly fee. In such a model, clients “subscribe” to the firm’s services like they would to a software product, gaining ongoing value while the firm gains predictable income.

Productisation of legal services is another avenue. Rather than reinventing the wheel for each client, a tech-driven firm might develop standardised solutions (e.g. an automated contract review platform or an AI-driven compliance tool) that can be sold to many clients. The lawyers then act more like product managers and advisors, maintaining the solution and handling complex exceptions. This turns legal know-how into a repeatable asset.

Harvard Business Review has noted that high-end services firms can break out of linear growth by packaging their expertise into products - exactly what a “law firm run like a tech company” would do. By 2030, we may see hybrid law firms that derive substantial revenue from subscription plans, legal tech apps, and other recurring sources, alongside traditional legal advisories.

Crucially, moving to recurring or value-based fees also aligns with the impact of AI: if software dramatically boosts lawyer productivity, firms will need alternative revenue models (subscriptions, success fees, etc.) to avoid shrinking their top line when hours fall. In sum, the law firm becomes a legal solutions provider with income streams more akin to a software company than a billing bureau.

Capital Allocation: Product Development, Talent & Marketing vs. “Service Delivery” Costs

How Tech Does It: Tech companies allocate resources with a heavy bias toward building and selling the product. This means lavish spending on R&D and marketing relative to revenue. Major tech firms routinely devote 10-20% (or more) of revenues to research and product development - collectively, Big Tech’s R&D budgets have grown ~22% annually in recent years. At the extreme, Amazon’s R&D and infrastructure investments led all U.S. companies, topping $80 billion in 2023. In parallel, tech firms invest in growth through sales and marketing. It’s not uncommon for a cloud software company in growth mode to spend 40-50% of its revenue on sales and marketing efforts. (Salesforce, for example, spent 45% of its revenue on sales and marketing in 2021, building a global salesforce to push its SaaS product.)

The philosophy is clear: invest aggressively in acquiring customers and improving the product, even if it means lower short-term profits. Tech leaders also invest in top talent (engineers, designers, data scientists) and often in employee equity to motivate innovation. Every dollar is judged by its impact on product-market fit or scalable growth, rather than immediate profit margin.

Reimagining a Law Firm: Historically, law firms have allocated capital in almost the reverse manner - minimal spending on R&D or proactive marketing, and the bulk of expenses going to salaries, rent, and other service delivery costs. The average law firm spends only about 1-2% of revenue on marketing and at most 1% on true R&D projects, figures that lag far behind tech-sector norms. Running a law firm like a tech company would entail dramatically rethinking this budget mix. More funds would be channeled into building digital infrastructure, developing proprietary technology, training staff in new tools, and creating client-facing products. In practice, this might look like setting up an internal R&D team (something a few big firms have started to do - e.g. Clifford Chance established a dedicated R&D function to drive digital product development ). It could also mean hiring software developers, UX designers, and data analysts onto the team - roles rarely found at traditional firms - to work alongside lawyers in innovating services. Such investment in product development could eventually yield new revenue lines (for instance, a workflow automation tool the firm can license to clients).

Another critical shift would be elevating marketing and scalable business development to a strategic priority. Instead of relying only on partners’ personal networks and reputation, a tech-oriented firm might invest in content marketing, search engine optimisation for online legal services, data-driven advertising, and even a sales team to target enterprise clients for managed legal services. While most law firms today devote a token amount to marketing, a tech-run firm might treat it as an engine of growth, much like a SaaS company would. The firm’s brand might be promoted via webinars, thought leadership whitepapers, or even free tools that attract potential clients (analogous to freemium models in tech).

Additionally, capital allocation would favor talent and culture initiatives that mirror tech companies - for example, offering equity-like incentives to top-performing lawyers or investing in cross-functional teams to improve service “product” quality.

All of this requires a mentality of reinvesting profits for future gains. It implies partners accept a lower profit-per-partner today to grow the overall pie for tomorrow, a trade-off familiar to startup founders but foreign to many law firm partners. The reward, if executed well, is a more efficient, innovative operation that can capture market share while competitors stick to the old low-investment, high-distribution model. As one Thomson Reuters report put it, “flexible, efficient, low-cost and high-value operations will be the hallmarks of the law firm of the future” - which “will require innovating the current equation of people + place + technology”. In other words, future-ready firms must spend differently to work differently.

Go-to-Market Strategies: Scalable Reach vs. Personal Networks

How Tech Does It: When it comes to acquiring customers, tech companies don’t wait for business to walk in the door - they go out and get it in a systematic way. This includes demand generation marketing, inside sales, partnerships, and product-led growth strategies. A company like Google or Facebook leverages digital channels and network effects to reach billions of users with relatively low marginal cost. Enterprise tech firms hire teams of salespeople and employ data-driven funnels to convert leads into paying customers around the globe. Even consumer tech and fintech startups use tactics like viral referral programs (e.g. PayPal’s famous sign-up incentives) or content marketing (blogs, webinars, social media) to build a user base.

The key is that tech firms seek scalable customer acquisition - they build a machine that can deliver steady growth in users or clients, often powered by marketing automation and analytics. Also, branding plays a huge role: top tech companies cultivate strong brands (think Apple’s identity or Salesforce’s thought leadership in CRM) to differentiate themselves in a crowded market. Go-to-market strategy in tech is usually formalised and budgeted - there’s a clear plan for how to capture market share, whether via direct sales, channel partnerships, freemium models, or platform ecosystems. Crucially, many of these tactics can be ramped up without linear increases in cost, especially when a product can be distributed online.

Reimagining a Law Firm: By contrast, traditional law firms have historically grown through reputation, referrals, and the personal hustle of partners (the classic “rainmaker” model). Marketing was often an afterthought - in fact, legal advertising was once restricted by ethics rules in many countries. Today, while law firm marketing is more accepted, it remains conservative: websites, sponsorships, events and occasional thought leadership papers. A law firm that runs like a tech company would approach growth very differently. It would craft scalable go-to-market strategies for legal services.

For instance, the firm might identify a niche (say, crypto law) and provide upfront value through the creation of online assets and tools to attract that audience at scale - much like a tech vendor may offer a trial. A law firm following that lead could develop an online self-service portal for certain services to capture small-business clients, using digital marketing strategies to reel them in.

Another adaptation is the introduction of a sales function - something almost unheard of in old law firms. A tech-influenced legal service company might employ business development managers who actively pitch solutions to corporate clients, akin to SaaS sales reps demonstrating a product. 

Go-to-market could also involve partnerships: for example, partnering with a tech company to provide integrated legal-compliance services on their platform, reaching more customers through someone else’s distribution channel.

Additionally, branding and user experience would become paramount. A firm might invest in a polished digital presence and even customer success teams to ensure clients are happy.

All these tactics represent a shift from a law firm as a collection of individual practices to a law firm as a unified service enterprise with a clear market strategy. It’s the difference between waiting for a referral versus running campaigns to generate demand. If done well, this can significantly expand a firm’s reach beyond the limitations of geography and personal networks. A potential client in London or Singapore could become aware of a NewLaw firm via a compelling online offering just as easily as they might discover a new app - something unthinkable in the old model.

Of course, this approach requires funding and a mindset for experimentation (tying back to investment and capital allocation). It also demands that legal services be sufficiently standardised or packaged so that they can be marketed at scale - which reinforces the need for productisation mentioned above. In summary, a tech-driven law firm would market and sell proactively, using data and digital channels to grow, rather than relying solely on reputation and relationships.

Long-Term Upside: Equity Value vs. Yearly Profits

How Tech Does It: Perhaps the most striking difference is how success is measured in the long term. Tech companies and their founders aspire to create equity value - building an enterprise that can be sold or listed at a high multiple of its revenues or earnings. The tech world is replete with stories of explosive value creation: Amazon’s stock rose nearly 500-fold from its 1997 IPO to 2020, and today Amazon’s market capitalisation hovers around $1 trillion. Facebook (Meta) went from a dorm-room project to a $100+ billion IPO in eight years.

These huge upsides come from the scaling and network effects inherent in tech models, and from investors’ willingness to pay for future growth. Early employees and founders often profit via stock options or share sales when these events occur. In other words, tech companies offer a long-term exit or wealth-creation event that far surpasses the annual salary or dividend payouts.

Even smaller-scale, many tech startups target becoming “unicorns” (valued > $1 billion) as a sign of success. This equity-driven mindset incentivises management to prioritise strategies that increase the overall enterprise value, even if it means sacrificing this year’s profit. It’s a fundamentally growth-oriented outlook: the pot of gold is at the end of the rainbow (IPO, acquisition), not in quarterly distributions.

Reimagining a Law Firm: Traditional law firms have not been built for this kind of wealth creation. Partners derive their returns largely through yearly profit shares (drawings) rather than capital gains on equity. In fact, in many jurisdictions law firm equity wasn’t tradable or open to outsiders at all until recently, which made the concept of a law firm “valuation” mostly theoretical. When valuations are done (e.g., for a merger or sale of a small firm), they tend to be modest - often on the order of one times annual revenue or a few times earnings. For example, when UK firm Gateley listed, its initial market value was around £140 million (roughly 1.2× its revenue).

Compare that to a high-growth tech company which might be valued at 10× or 20× its revenue due to anticipated growth. To run a law firm like a tech company is to prioritise equity value and long-term upside. Practically, this could mean restructuring the firm to allow equity sharing beyond the partner group - issuing shares to employees, taking on private equity investors, or even planning for an IPO or acquisition down the line. The firm’s leadership would then focus on strategies that increase the firm’s overall market worth: for instance, creating proprietary technology (intellectual property can boost value), building a strong brand, and accumulating a broad client base or user base that could command a premium in a sale. It might also involve geographic expansion or mergers to increase scale, aiming to be an attractive acquisition target for larger players (perhaps even one of the Big Four professional services firms or a well-funded legal services company).

The long-term upside for individuals in a tech-run law firm also changes. Instead of just yearly bonuses, lawyers might receive stock options or equity that could be worth much more if the firm grows rapidly. This could help attract entrepreneurial-minded talent to the firm (similar to how startups lure employees with stock options and the dream of a big exit). It does, however, fundamentally change the nature of the firm. Pursuing an exit or high valuation might conflict with the professional ethos if not carefully balanced - regulators and clients will want to be sure that quality and ethics aren’t sacrificed for growth.

But if done responsibly, the law firm transforms into a legal enterprise with shareholders, akin to a publicly traded company in the legal industry.

By 2030, it’s conceivable that the market will see numerous "digital first law firms" - firms that by virtue of their tech-driven models have achieved billion-dollar valuations. But at that stage, can we even call them “law firms”? Or are they legal technology companies that deliver legal outcomes? This blurring of definition is exactly the point: the more a firm gears itself toward long-term equity growth, the more it behaves like a company rather than a partnership of lawyers.

Conclusion

Attempting to run a law firm like a tech company ultimately means reinventing what a law firm is. From how it raises capital and generates revenue, to how it allocates resources and pursues growth, every facet begins to mirror a high-growth tech enterprise rather than a traditional partnership. The thought experiment “can you run a law firm like a tech company?” leads to an intriguing answer: yes, but if you do so successfully, you may no longer be running a conventional law firm at all.

You would be at the helm of a technology-driven, productised legal services company - a hybrid entity that combines legal expertise with the operating model of a Silicon Valley startup. Such a firm would likely have external investors, offer subscription-based or platform-based services, employ engineers and data scientists alongside lawyers, and seek scalability and innovation in delivering legal solutions. Its success would be measured not just by this year’s profits per partner, but by the growth and equity value created over time. Crucially, this tech-oriented model is not about flashy jargon; it responds to real pressures and opportunities in the legal market.

Clients are demanding more efficient, cost-predictable services, especially as economic uncertainty looms. Emerging technologies like AI are automating routine legal work, which rewards those firms that can leverage tech to deliver more value for less time. By 2030, in the age of AI-assisted lawyering, the firms that thrive may be those that have broken the traditional mold - firms that can integrate AI tools into a productised workflow, charge on outcomes or subscriptions, and scale their services globally. In effect, they become legal tech companies by another name. Thought leaders at Thomson Reuters and law firm consultants have predicted that the law firm of the future must be “flexible, efficient, low-cost and high value”, which echoes the operating principles of leading tech firms.

Of course, transforming a partnership into a high-growth enterprise is challenging. It demands visionary leadership, cultural change, and navigating regulatory boundaries (not to mention learning from past failures - the demise of some early “law firm startups” shows it’s not an easy road).

Yet, the opportunity is clear: the legal profession is on the cusp of a new era where traditional and tech models converge. Law firm leaders and aspiring founders (Managing Partners?) of digital first firms should take inspiration from how tech companies invest, innovate, and scale - not to discard the profession’s core values, but to amplify them through better business design.

The endgame might be that what we call a “law firm” in 2030 looks radically different from today’s norms. It might look more like a legal services platform - part law firm, part software company - delivering legal advice not as hours of work, but as outcomes supported by technology and data. That vision represents not the end of lawyers, but the evolution of legal services. As with any industry disruption, those who embrace the future early will shape it.

And in summary, you can run a law firm like a tech company, and if you do, you’ll have created something hugely transformative: a future-proof legal enterprise for the AI era, where law is practiced as both a profession and a scalable product.

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