As job opportunities in the legal tech markets in the U.S. and U.K. grow, some entrepreneurs are venturing into regions of the world with more nascent legal tech scenes to find new talent, lured by the prospect of “outside the box” thinkers.
To be sure, legal tech is no stranger to the idea of hiring from a homogenous pool of talent in established markets. The results are often polished products that are built by following a well-worn path, recruiters say.
However, when talent is mobilized from regions with a young legal tech market, and from a judicial system that is less mature, entrepreneurs are finding it may yield more innovative products than those developed by tried and true hires from areas like Silicon Valley. They warn, however, that the road is often risky, time-consuming, and uncertain.
Legaltech News reported last week on new startup Hence, for instance, which hires from an “underleveraged” legal tech talent market in Africa with a base in Kigali, Rwanda. Hence co-founder Arun Shanmuganathan said the decision to broaden its legal tech talent pool was an economical and creative one.
“We are hiring people across the continent [Africa] like from Uganda, Ethiopia, and of course Rwanda, perspectives that you don’t often see in the U.K. or U.S. legal tech worlds because hiring from the perspective of ‘I’ve worked with these people before, so I’ll work with them again,’ is an easy default to have,” Shanmuganathan said. “But when companies start exploring beyond that—maybe a candidate didn’t go to the right school, or hasn’t worked in the right company—you start seeing newer perspectives to solutions emerge, ones that are cheaper, better, and more efficient in the long run.”
Still, Shanmuganathan and Hence’s other co-founder, Steve Heitkamp, acknowledged that it can be difficult to not hire a “Stanford or MIT grad” and diverge from a successful model.
“Investors are used to the young dude wearing a hoodie who is going to be your next innovative disrupter,” Heitkamp, who used to work at Silicon Valley’s Palantir, said. “But we are trying to encourage them to look beyond those biases because you will find that when you involve people from different parts of the world and leverage that knowledge economy, you’re going to get a much richer set of answers to solve a complex problem.”
The decision to recruit from new legal markets is reminiscent of Big Tech outsourcing software to programmers in developing nations to cut costs and increase margins of profit more than a decade ago. Hence’s strategy is similar, but this time hiring is in more creative positions like sales and product development, along with software development.
Even so, how does a company know which region has the most potential for innovation?
While is not easy to quantify, Raymond Blijd, an Amsterdam-based attorney and owner of LegalComplex, is attempting to do so by mapping the number of legal tech companies, capital, and talent in different parts of the world.
“There are two factors that influence legal tech innovation in general, that is political culture and the faith a population has in its judicial system,” Blijd said. “In environments where entrepreneurs don’t trust their legal system, you typically see the most creativity. So in environments like Moscow, Bengaluru in India, Estonia, and Hangzhou in China, you see the coolest, weirdest legal technologies.”
Blijd believes that the more disorganized or difficult a judicial system is to navigate, the more interesting technological solutions people are forced to come up with in order to cope.
“We see Bengaluru as the largest legal tech talent pool outside of the west [Europe, North America] and Oceania,” he said. “But note, it is pretty challenging for us to get good population data on China.”
While he prefers to stick to the numbers, Blijd said there is good evidence that potentially overlooked legal tech markets produce innovative legal tech products largely because of the way their legal landscape is structured, forcing them to think “outside the box.”
The Hence co-founders echo similar sentiments as Blijd. Shanmuganathan notes that in Rwanda and throughout the Africa, because “the path to a legal tech career is not as clear as in the U.S. or U.K,” the talent is often able to come up with the most interesting solutions.
The Difficult Path to Innovation
To be sure, it can be difficult to recruit and hire from such a population. Jon Bartman, the leader of the tech team at international consultancy firm Jameson Legal, noted that such a strategy can be a double-edged sword.
“It’s so much easier as a solution provider to hire someone who has been doing it for X amount of years into the framework,” Bartman said. “What they don’t realize is that what this person brings with him is not going to change the game or bring too much innovation, but yes it will give a kickstart to introductions that this person likely has in the industry, and that your more innovative hire may not have. It’s not necessarily going to lead to more sales or more ideas, but it is a safe pair of hands.”
Bartman, who is based in London and works with recruiting legal talent around the world, thinks some of the biggest challenges to hiring outside of the traditional legal tech pool are logistical.
“In some emerging nations, you are going to have to look at things like internet and Wi-Fi access, or electricity access and to see if you are going to be in compatible time zones,” he said. “I get some of my best talent from South Africa, but during certain times of the year, they have load shedding where they cannot use their Wi-Fi for four or five hours. That suddenly starts becoming a problem. So the innovation is out there, but it is easiest to recruit from what you know and where you are.”
Shanmuganathan and Heitkamp don’t deny the singular struggles of their hiring venture, but they believe it is par for the course, and ultimately worth it.
“Finding ways to leverage talent from [underleveraged regions] is hard work, they might have weak English skills where you have to think about translation or other initial barriers,” Heitkamp said. He added, “But their potential can be worth it if you push through that initial hardness.”
Of course, the needs of each legal tech company differ, and the struggle to hire from a lesser-known pool of talent may not always be worth it.
Sang Lee, CEO and co-founder of Thine, a New York-based company that assesses legal hiring, points out that hiring is dependent on an entrepreneur’s needs and how much time they are willing to invest before hitting the ground running.
“Even though innovators and technologists are disrupters by nature, the global economy moves so quickly that time really does equal money,” Lee said. “From my perspective, the risk [to hire from nascent legal tech markets] is worth it. But it depends on the person’s appetite for change. If a legal tech company is bold enough to access talent outside the countries they usually go to, I think the innovation is there and is possible, but it really depends on your needs: speed or innovation.”
