Beyond Billable Hours: Flatiron's Conrad Everhard on a Fixed-Fee and Tech Based Approach to M&A
Nov 20, 2024
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Conrad Everhart, founder of Flatiron Law Group, shares his journey from Georgetown grad to partner at major law firms like Jones Day. He left BigLaw to offer a cost-effective, tech-driven model for M&A services. The firm utilizes flat fees, low overhead, and custom software like Deal Driver to enhance client insights. Conrad also discusses his work with Stanford’s Codex project, where he's developing an AI negotiation simulator to train future lawyers, emphasizing the crucial blend of AI and human judgment in legal negotiations.
Conrad Everhard's Flatiron Law Group revolutionizes M&A legal services by offering flat fees and leveraging custom technology to reduce costs.
The collaboration with Stanford's Codex Project aims to create an AI-based simulator for training young lawyers in complex negotiation scenarios.
Deep dives
Innovative M&A Legal Services
The Flatiron Law Group offers a novel approach to mergers and acquisitions (M&A) by prioritizing cost-effectiveness and efficiency. Founded by Conrad Everhart and his partners, the firm differentiates itself from traditional law firms by leveraging technology to streamline the M&A process. Their model includes low overhead, the use of general contract labor for labor-intensive tasks, and proprietary technology such as their custom-built deal driver software. This innovative framework aims to provide clients with a more accessible and straightforward alternative to the high fees typically associated with M&A attorneys.
The High Costs in Big Law
The podcast discusses the alarming increase in billable rates within the traditional legal sector, particularly in M&A roles, where rates often exceed $1,000 per hour. A report suggests a 12% increase in fees in 2024 compared to the previous year, raising questions about the true value and necessity of such high costs unless hiring elite litigators or dealmakers. Everhart critiques this trend, suggesting much of the legal work in M&A is commoditized and, in many cases, does not justify the exorbitant billing practices. He highlights the importance of alternative models, like Flatiron's, which can deliver high-quality legal services without the traditional overhead.
AI in M&A Negotiations
Conrad Everhart's engagement with Stanford's Codex Project focuses on creating an AI-based negotiation simulator designed to train future lawyers in M&A negotiations. This project emphasizes the need to extract decision-making processes from experienced senior lawyers rather than merely relying on existing legal documents, which reflects the final outcomes of negotiations. The simulator aims to allow users to experience real-time negotiations and refine their strategic responses based on market standards. This highlights how AI can enhance legal training by simulating complex negotiation dynamics that are difficult to capture entirely through documentation.
Flatiron's Operational Model
The operational model of Flatiron Law Group centers on a three-pronged approach that enhances service delivery while maintaining efficiency. First, it employs a low-overhead virtual work environment that facilitates remote operations and reduces costs. Second, the firm adopts a general contractor labor model, utilizing highly skilled legal professionals without the burden of fixed salaries. Lastly, advanced technology plays a crucial role, as the firm utilizes platforms like Airtable to manage data collaboratively and automate aspects of due diligence, significantly expediting the M&A process.
Conrad Everhard, founder of Flatiron Law Group discusses his career trajectory from Georgetown University to becoming a partner at Big Law firms Jones Day and Brian Cave. He explains why he left BigLaw to found Flatiron Law Group, to provide a more cost effective and efficient way to offer legal services to clients involved in mergers and acquisitions.
To do so, the firm leverages a multi-pronged model: flat fees, low overhead, general contract labor to assist with the more labor intensive parts of an M&A deal, and advanced technology, including the firm's own custom build Deal Driver software that provides the clients with data and other insight about the deals they are working on.
Conrad also talks about his work with Stanford’s Codex project, where he is helping develop an AI based negotiation simulator to train young lawyers in M&A deals. He highlights the importance of capturing the decision-making process of senior lawyers to effectively guide the AI model.
Key Discussion Points & Timestamps:
Transition from Big Law to Entrepreneurship: [0:40 - 13:03]
The Flatiron Model: [14:16 - 26:48]
Work with Codex and AI in Legal Training: [26:48 - 33:00]
Resources & Links:
Flatiron Law website: flatiron.legal
Episode Credits
Production: Grant Blackstock
Theme Music: Home Base (Instrumental Version) by TA2MI