What I'll be Looking For at CLOC
What I'll be Looking For at CLOC
The state of corporate legal AI adoption and is CLM a wilting flower?
Hey there, I’m Zach Abramowitz and I’m Legally Disrupted! Today’s dose of disruption is being mixed inside my hotel room at the Aria Resort and Casino in Las Vegas, home of this year’s CLOC Global Institute (CGI, but most people I know still call it CLOC).
I’ve got a few things I’m looking for at this year’s conference:
How are legal departments (and legal ops folks in particular) using GenAI tools in their departments?
If legal departments are indeed using AI, who/what is the AI replacing?
Has CLM essentially become legacy tech? (This one is not going to make me any friends)
But first, some of you may not be familiar with CLOC and why it matters. CLOC was, at its inception, a gathering of a pioneering group of legal operations professionals, predominantly in the West Coast. Eventually the group started an annual conference that appeared on my radar for the first time in 2016. I attended the conference for the first time in 2017, introduced the concept of the “sponsored” poolside cabana in 2018 (if you were there, you know that it was legend) and returned every year until 2020. I returned for the first time post pandemic in 2022 and had to sit out last year because of prior personal commitments. Today, CGI’s 2000+ attendees include legal ops, in-house attorneys, law firm folks, tech companies and other vendors/service providers.
There are a lot of reasons to go to CLOC — I go because a good number of #legaltech companies (especially those that market to legal departments, rather than law firms) invest the lion's share of their annual conference budgets to exhibit there. It’s not just about the money either. In-house departments and their tech partners alike will use CLOC to flex on some of their most compelling case studies. All in all, it’s not a bad spot to get a snapshot of legal department tech adoption. So what I’m looking to see in this year’s snapshot?
GenAI in Legal Departments
I already know that legal departments are using GenAI tools, but I’m looking for a little more specificity — things like…
Are they using basic tools like ChatGPT or Office365 or are they purchasing legal specific tools?
Are they focused on solving for specific use cases or are they trying to increase the number of team members who use GenAI regularly?
How are different in house positions making use of the tools differently?
If Legal Departments Are using AI, Who’s Being Replaced?
Last week during my keynote roundtable with Cat Casey and Kristen Sonday at the EVOLVE conference in Charlotte, we put up the following slide that shows a side-by-side comparison of Klarna’s tweet about using for customer support (saving the company $40M) and the crash of Teleperformance’s stock (a French call center company that could be impacted by AI).
I don’t think it’s a zero sum game, but let’s be real: there are plenty of instances of AI genuinely replacing current labor. I keep talking about the story Josh Kubicki recently told in his newsletter Brainyacts and on Twitter. 1
And my question is, if legal departments are using AI, who’s getting left out in the cold? Is it outside counsel? staffing agencies? human labor heavy ALSPs? Legacy software providers? Which brings me to my last comment.
Is CLM a Legacy Tech Vertical?
Last time I was at CLOC, I wrote an article titled “Was CLOC 22 CLM’s First and Last Hurrah,” in which I predicted that CLM had reached its peak and would show a steady decline. I don’t have great data on this, and I’m sure CLM companies are continuing to sell, but I wonder if perhaps CLM as a vertical is a wilting flower, plucked from the ground — it still has the look and smell of the original flower, but not for long.
I saw earlier that Docusign announced its acquisition of Lexion for $165M. I don’t know what they were valued at back in 2022 when they raised $20M, but it sure as heck was more than $165M, when CLM companies were getting valued at 50x revenue. I also noticed that Ironclad was the only company that was a Diamond Elite sponsor at the conference. Another Diamond Elite sponsor is Robin AI, an AI first contract company that eschews the title CLM. Is AI eating CLM? Am I reading too much into this? Almost certainly.
In other things that probably mean nothing, I couldn’t help notice that one of Ironclad’s digital billboards at the Vegas airport (nice touch btw Ironclad marketing!) was “Ironclad: the last CLM you will ever need.” I know what they meant, but I couldn’t help but chuckle at the implication that people organizations might stop buying expensive CLMs.
Hey, if you liked this content and you’re trying to get prepared for CLOC, can I also suggest LegalMation founder Thomas Suh’s guest post last week, which you can read here. Stay disrupted!
Embed code was glitching on me, and I’m already late for dinner!