Alex Su (00:01):

Today is our first Meeting of the Minds LIVE. Some of you may know me, but my name is Alex Su. I'm the director of business Development at Evisort. And Evisort, as you know, is an AI-powered contract management system. We've been launching a series of content called The Meeting of the Minds Podcast for a few months, and what we decided to do is turn it into a live webinar, primarily to get interaction, to get your feedback. We're hoping this will be a little bit different in the sense that it's just not us talking at you. It'll be you being able to contribute through polls and questions.

(00:38):

So, what we're going to do is, we're going to get started by doing some introductions. Really excited, because we have Rudy DeFelice, the CEO of KP Labs, joining us here today to talk about the topic, which is transforming into business accelerators. What we really wanted to say, what I really wanted to say is, how do you turn legal from a department of no to a department of yes, which I know may be a slightly controversial topic. Some folks have strong feelings about that. We're going to dive right into it. But we wanted to get started here.

(01:08):

And before I introduce our speaker, Rudy, who's got a wealth of experience, wanted to share a couple of housekeeping items for you all as we get started here. The first is that we're going to launch a poll to understand who you all are. That'll help us direct the discussion. So, Neha, if you can, if you can go ahead and launch the poll. We'll run this for a little while as people trickle in, but we want to understand who the listeners are, what you do, and that'll help us shape the conversation, because we can see the poll results. And we'll also share this with you later so you can see which of your colleagues are here. But that's the poll.

(01:47):

And would love to hear from you all, both in the chat, which you can participate in. We have a chat enabled. And just to let you know, if you want to chat with everyone, there's the ability to do the drop-down. There's a way to send messages to all panelists, but also to all panelists and all attendees. So, if you want just Rudy and me to see your message, you can do that by clicking on all panelists. But if you want everyone to see it, you can do all panelists and attendees.

(02:17):

We also have the ability for you to put in your questions. There's a Q&A function. We'll be reviewing the Q&A and the chat every so often, because we don't want to just, again, talk at you. We want to incorporate your questions, your commentary, and your thoughts, as well. This is supposed to be interactive. That's why it's different than a typical recorded interview, something like that.

(02:43):

So, anyways, really excited to get started here. I'm seeing more people come in, so we're going to go ahead and get started. Really excited to bring Rudy DeFelice to the webinar today, to Meetings of the Minds LIVE today. As I mentioned, he's the CEO of KP Labs, and he started his career, early on, spent almost a decade in big law, then followed up with a wide range of entrepreneurial pursuits, and now is focused in legal operations. But Rudy, really excited to have you here today. Do you want to go ahead and introduce yourself and tell us a bit about the work you do at KP Labs?

Rudy DeFelice (03:19):

Yeah, it's a pleasure to join you, Alex, and to talk to everybody who's joined us. I think it's fitting that we started the hour talking about Alex's stylish haircut. One of the great things about our Zoom portal to the world is we get into each other's homes and maybe into each other's lives a little bit, and there's a little more humanity to business as a result of that. So, we notice these things about each other. Our company believes in digital transformation, and we serve corporate legal departments. The three areas we work specifically are business process management, bringing technology to processes to make them work better and remove some drudgery from people's lives. The second is contract intelligence, which I think we'll talk about a lot here. And the third is hard problems. We tend to ask our clients and friends, "What's hard? What shouldn't be?" And we build custom solutions or find things to solve some of those problems. So, that's what we're focused on.

Alex Su (04:09):

Absolutely, and I think Rudy brings a wealth of experience here in this space on today's topic, which is... There's twofold. There's a couple of topics as we... It looks like our poll results show that most of you are in corporate legal departments, so, in-house lawyers, it sounds like, some folks who are... I know there may be some paralegals, maybe some legal operations specialists.

(04:34):

So, what we want to talk about, the first topic is why is it important for legal to work cross-functionally with others? This is a topic that's kind of top of mind for a lot of in-house lawyers, what the career benefits there are to enabling your business, especially revenue teams. We'll talk more about that in a bit. But we're hoping to get some good discussion on your views and, Rudy, on how legal can support other departments.

(05:06):

And then, we also want to touch upon something that's very near and dear to Evisort's heart, which is the datafication of contracts, that is, are there patterns in your contracts, is there information in your contracts that can help you achieve that first goal, which is to work cross-functionally to bring value to other members of your team? So, Rudy and I have talked about this in the past, and we're eager to continue the conversation today, get your feedback, get your questions.

(05:31):

So, I'll add that, please, as you're going through this, submit questions. We've got a couple of more poll questions, really curious to hear your thoughts on a few things, but please do submit your thoughts on the topic, any feedback you have for anything we're saying or any questions you want us to address. That'll make sure that we stay on topics that you're interested in.

(05:55):

So, we'll kick it off with the main topic, which is why is it important, Rudy? And I'll throw this to you. Why is it important for legal to work cross-functionally? Why can't legal just be the department that focuses on risk, on the legal aspects of the business? Why do you need to work with others, and what benefits are there to doing that?

Rudy DeFelice (06:15):

Well, short answer is, just focusing on risk and what could go wrong is not an inspiring enough way to lead your life or your department, so, that's kind of boiling it down. But I think what's really going on that's underneath that answer is, we're in a transformational time for corporate legal departments, and it's a super exciting thing to be part of.And I think the agent of that transformation is information. And by that, I mean, we're in the information economy right now, and that's relatively new. Over the course of the arc of our careers, the information economy is a relatively new phenomenon, but in that economy, it's recognized that information is a strategic asset which has value. And as organizations look at how to optimize the value of that asset, they tend to look to legal, because we've been managing information in sophisticated ways for a long time. In terms of getting right information to the right place with security and governance and those kinds of things, legal departments tend to be really good at that. So when organizations are looking to leverage the asset they have and their information, corporate legal's one of the places they turn to.

(07:20):

So, there's a really transformational time from, as you said, going from the risk department, the department that says no to things. There's good reasons to put your seatbelt on, so it's really good that we're keeping our eye on that ball, but there's also really good reasons to figure out how to drive faster. So, I think corporate legal has the opportunity to step into that. And one of the things we try to do as a company is to enable people to do that with credibility. I mean, one, in many of my conversations, I empower people. I try to get them to think of themselves this way. Think of yourselves as a strategic asset, not just a place to go to take care of risk. That needs to be done too. But there's an openness to that and an opportunity, I think, for us in the corporate legal world to step into that role, and it's a really exciting place to be.

Alex Su (08:07):

Absolutely. And I think a lot of that, the strategic assets that we're talking about here, are buried in your contracts, which we'll touch upon in a second, but this might be a good time for us to kind of take a step back. And if we could just launch the second poll, Neha. There's 80% of you, by the way... 80% of the people on this live session are corporate legal departments. So, we'll make sure this is highly relevant to those folks.

(08:32):

But this is a question we wanted to ask. What's your top priority as an in-house legal department professional, whether you are in legal operations or whether you are an in-house lawyer? Is it to protect against risk, or to enable revenue? And it looks like as early results are coming into the poll, Rudy, it looks like it looks pretty evenly divided. There seems to be different views on this. What's your view, having worked with so many in-house legal departments and folks who have really moved up in the world? What's your thoughts on what the top priority of an in-house lawyer or a legal department person should be?

Rudy DeFelice (09:14):

Well, there's two questions packed in that, I think. What is it, and what do we want it to be? So, I think there's a point in time aspect to this poll response. If we'd asked this 10 years ago, almost everybody would've said protect against risk. And I wonder if we ask it 10 years from now, I think it will skew very highly towards enabling revenue, or enabling the business to move faster and better may be more broadly put. And it kind of depends on what you want out of your life, I suppose, and the impact you want to have. I think if you step back for a minute, you realize that the most important part of the company's operations is to grow, is to enable revenues to serve customers. Protecting against risk is a byproduct. It's not an end. It's a means to an end.

(09:57):

So, I think as corporate legal departments, we are absolutely counted on to deal with risk. We have not been counted on all that much to enable revenue, to enable the business to move faster and better. But I think we have that opportunity. So, to some extent, we need to teach the rest of the organization that we have this capability. I think there is this tendency to regard corporate legal departments with credibility when it comes to leveraging information assets. We're just the best at it. So, I think that that's kind of a lever to pull to make that transition.

(10:28):

I can tell you from... And I've been on both sides of this. I've been a lawyer, and then when I've been in a company where you're focused on revenue, there's a lot more attention given to those groups that are trying to generate revenue, try to make the business work better. So, when we think of where we want to be, we want to be regarded that way, I think.

Alex Su (10:49):

Absolutely. And it's funny you mention that, because as I look at my own career, having formally practiced law, I wanted to get on the revenue side for very similar reasons. And this brings me to our first comment from Brittany here, which is, for her, risk is obviously very important, but in today's world, revenue is super important. And Brittany and I have worked together, and I think she's right on the money, which is if you take it too far with assessing risk and you don't enable the revenue part of the team, you can be viewed as a blocker, which can really limit your career in many ways. And so I'm curious, Rudy. This is something you've probably seen with a lot of lawyers, especially lawyers who come from law firms, because law firms, assessing risk and protecting against risk goes hand-in-hand with enabling revenue, right? And I see you smiling. What's your thoughts on that? Why do lawyers focus so heavily on the risk part when they move in-house?

Rudy DeFelice (11:43):

Well, somebody needs to do that. And your sales group, that's just not in their DNA, right, and in many of the other production groups and other business units. So, they count on us for that, and we have to manage that part of the world too. I guess, so, my position is I would not abdicate that responsibility. I think we need to embrace that and continue to get great at it.

(12:06):

But I think that we need to expand our view of ourselves, for starters. And change comes from the inside, right? The company's not always going to come to us and say, "Boy, we'd like you to do this." But I think we need to lead in that area and say, "Hey, we have some great ideas. We have ways to leverage this asset in a way that could drive the business." And that's the exciting part of our work. We like to align with our clients and say, "We want to be behind you in transforming your career and your department to be seen this way." So, for people who have the vision and the courage, and we have clients who do that, and they're really seen in this regard, so this is a thesis that's been proven, as far as I'm concerned.

Alex Su (12:46):

That's right. That's right. And I think part of it is... I think you had mentioned something earlier that I want to kind of dig into a little deeper, which is how corporate legal departments view their job today may be very different than how they viewed it 10, 20, or even five years ago. In my conversations with in-house lawyers, there's a lot of work to be done, fewer head count to address it. And so, there's a lot of things that don't get brought out, things that can be assets to the revenue teams, like what's inside of your contracts. Where do you think there are opportunities, Rudy, for lawyers to enable their revenue teams, given what's on their plate right now of work to do?

Rudy DeFelice (13:30):

Well, you mentioned contracts, and we're both focused in kind of contract intelligent management. So, this is an area we've delved kind of deeply already. I think that that is a huge untapped resource. There's so much white space in the body of our contracts to help the business operate better. And it really manifests in two ways in my mind. I mean, we tend often to think about it somewhat transactionally, "Can I find a contract to answer a specific question?" And there's value in that. And I think getting better and better at that does serve the business.

(13:59):

But I think the really exciting opportunity, and the real unlock here, when I think of unlocking value, is in thinking about our portfolio of contracts and learning what can make the business run better? What has historically worked [inaudible 00:14:14], based on what we know about all our contracts? And you mentioned this term that we like to use a lot, the datafication of contracts. When we break our contracts down into data elements and can access them, just the way we've made huge advances in dealing with the market by getting data about our market, huge advances in our business operations by getting data about operations, we can make a tremendous amount of advancement in how we think about structuring deals and operating the company based on the data that's in our contracts.

Alex Su (14:41):

Yeah, absolutely. And I know we have a list of a whole bunch of different people on the call right now who have done this in their roles, I know personally. But would love to hear from you all. Chime in on the webinar chat or in the Q&A.

(14:55):

But we would love to hear more examples of how you've been able to empower your business teams, Rudy. One example I've heard is maybe it's just very contract-centric. I'm sure there are other ways. But I've seen companies be able to use technology and apply legal judgment to find out, "Well, in the past, which revenue generating agreements are less favorable? How do we generate more royalty and maybe renegotiate some contracts that we should, maybe something was signed a long time ago?" And that goes towards your point about datafication of contracts, because if you don't know what's in them, you can't really make that recommendation. But with technology, you can. And there's a lot of different ways you can do that.

(15:39):

And so, I'm curious if there are specific examples you've come across where someone has leveraged either an ALSP or a technology to outsource some of what has historically been legal department's function, and then, what exactly do you do on that second level, what examples of stories where people have actually been able to enable revenue teams or other business teams?

Rudy DeFelice (16:05):

Let me talk for a second about dealing with contracts on a portfolio basis.

Alex Su (16:11):

Sure.

Rudy DeFelice (16:11):

Because I hope this is responsive to your question, although I'm sure I'm exactly on it. So, a super fun example I talk about sometimes is there's this Chinese mobile lending company, and they've found there's a correlation between the battery level on your phone when you applied for your application and your likelihood to pay back the loan. And that's an interesting correlation humans would never think of. There's no logic behind it. I don't even know if a full battery makes you more or less likely. But they know. They've seen this correlation.

(16:40):

So, when you think about our whole portfolio of contracts, one example I could think of is maybe when a certain group of people work on a deal, it tends to have more efficiency, or when we deal with certain clauses in a certain contract with a certain class of partner, the deal tends to be more successful. So, there's all kinds of correlations that we might be able... to be drawn that are not obvious to humans, necessarily, might not have even asked the questions, that having the portfolio of your contracts datafied unlocks the creativity to go in and tap those things. So that's kind of on a portfolio basis. And I'm not sure if you are asking for examples on how we can use our portfolio to provide strategic insights, but that's what the answer was directed towards. If that's not it-

Alex Su (17:26):

Yeah, that is. And I love that example, because it's a different way of thinking about the data points you have, right? In the past, you're probably used to looking at... In your example, for money lending, you may want to look at income levels. You may want to look at all these other factors. But now, you're looking at a data point that historically, no one's been looking at.

Rudy DeFelice (17:43):

That's exactly right.

Alex Su (17:44):

And that's battery level, right? To draw that analogy out, now you're talking about, okay, well, maybe there's some opportunity, because maybe if this contract language was commonly used 10 years ago and is no longer being used because it's not as lucrative anymore, maybe it's related to a royalty payment. These are pieces of information. These are data points that legal owns and can provide to other departments to empower them. I've seen this happen with a couple of clients, when they're looking at royalty payments, for example. There's other examples, as well. But I think, in the past, people just haven't had the bandwidth to go through each one of their contracts to do that. That's what stopped legal in the past. And I think that's changing, right?

Rudy DeFelice (18:32):

I think it is. I mean, the tools are available. The technology's caught up, and then, there's this mindset that we talked about at the beginning of this call that we in legal could think of ourselves as a more valuable strategic asset. I think when those things come together, we're going to start seeing some pretty exciting things in this area together. We, together, our companies work with a streaming media company, very inventive, very forward-thinking, and they're starting to get the corpus datafied. And we're starting to ask some of these questions with their business units. What happens when you use a particular term? How does that affect how the rest of the deal flows? How does that affect how the rest of the production comes together? What does that mean for ultimate profitability? We can harness all this stuff in our organizations.

(19:14):

But the relationships start with contracts, and there's a certain amount of foundation-building that I think you need to do. At some point, someone said, "If we connect all these computers together, something cool might happen." We didn't know all the use cases for the internet at some point. Well, we're kind of there, I think, in the datafication of contracts. I think if we start at the end, and we say, "We've got to figure out all the ways we're going to use this," you'll miss the boat. Your competitors will go ahead and do this, and then you don't have the infrastructure built.

(19:40):

So, I think at some point, we need to embrace the fact that we're going to create these linkages, and we're going to build this infrastructure around the datafication of contracts, and that's going to unleash a whole lot of creativity that we can't tell at the front end. And I think we get in our own way a little bit sometimes if we say, "I need to know every way this is going to be used and know what the return on investment is on that." It's a very transactional way to think about it. It's not a visionary way to think of the world. So, if we do anything at KP Labs, we try to empower the clients we work with to think about things in a visionary way.

Alex Su (20:12):

I love that, because then, you're not just doing things for the sake of just generating work. You're really thinking about where you're moving the ball at a high level. And so for those of... I know there's some on the call who have contract management systems, technologies, processes, but what would you say to someone who would like to do that, who would like to enable revenue, who would like to help out the business teams, but doesn't know where to get started? What's the first step?

Rudy DeFelice (20:36):

Well, probably the more immediate stuff is to think about the more transactional use cases. I think that's kind of how you support a proposition internally. So, I think one, we embrace the fact that we want to be a strategic leader, two, that datafying our contracts is the way to get there, and three, some of the easy stories to tell that are more transactional in nature, for example, in procurement teams, there's often trouble with obligations management. Once contracts are signed, they kind of disappear into a repository, or there's some tribal knowledge about things like renewals and terminations. Having that datafied allows you to create alert systems, allows you to get in front of those problems so things don't get renewed automatically. You probably hate more than anything those auto-renew things that show up on your credit card, right?

Alex Su (21:27):

Yep.

Rudy DeFelice (21:27):

We have those in our enterprise too, right? So managing that is an easy area. Connecting alert systems to dashboards so that people can respond appropriately are easy things. On the revenue side, we had a client who had this idea that we might be able to bill earlier based on certain conditions in a contract than when the final product arises. So, if we could find all the contracts that have an allowance for early billing, we can drive revenue and accelerate the revenue curve. So, that was an amazingly responsive thing. So that's a specific question I think that you can add.

(22:09):

Also, force majeure has been very in the news after things like a pandemic. Well, this isn't the last phenomenon that's going to affect business. So, right after that, everyone was running to probably you and us and asking us, "Where can I find all my contracts with a force majeure clause?"

(22:25):

So, those are easy ways to think about it, and I think it can kind of support the proposition internally, because all these things, every visionary thing in an organization needs at some point to get started with somebody buying into the fact that there'll be a quick win, some return on investment early.

(22:41):

So, I think the way I'd talk about this proposition is I'd identify some of those more transactionally-oriented use cases that support the investment. But what I'd really be thinking of if I was in a corporate legal department, and what we try to get our clients to think of, is what's the visionary stuff that we can do once we get that? The beautiful thing is, if you datafy your contracts, you get them all at once.

Alex Su (23:02):

That's right. I love that term. I'm going to start stealing it. But Neha, if you can run the next poll. Datafication of contracts is a broader trend. I think it's happening across all organizations, because, historically, you have all these contracts. You're not sure what's in them. It's stored all over the place. There's a move to bringing on contract management, just because it's going to give you that insight into what's exactly in your contract. And as these poll results are coming in, it's about half-and-half. About half the folks on the call have a contract management solution. Half don't. It's obviously going to be something more and more legal departments are going to leverage in the coming future.

(23:42):

And I love the idea about getting the quick wins first. One thing we found is that we have different components of our technology. Some can be deployed very fast. Some take a while, just because you need to loop in other departments. But if you could show quick wins, it builds momentum, right? If you could say, "We can stop accidentally auto-renewing on contracts. Let's get that problem solved. But let's see what else we can do with all this contract data," right? That's a smoother way when it comes to change management.

Rudy DeFelice (24:17):

For sure. And a lot of these things, by the way, are risk aversion strategies, as well. So that's something where we're naturally expected to keep our eyes on stuff. So, I think, even to really fulfill your duty for risk aversion, I think datafying your contracts is something that's critical.

Alex Su (24:33):

Yeah, yeah, absolutely. I've heard also, in addition to extracting your contract information, there's also ways to leverage contract management to speed up the sales process, maybe reducing sales cycles, which... It's really interesting. I don't know if you've seen any cases like this, but there's also ways to bring value to revenue teams, not just by the amount of a deal, but how fast it can get signed. And that's something that legal departments can help with. And I know that there are folks who believe that, a lot of the times, that the hangup is because maybe there's miscommunications, or maybe there's contracts that are lost. But I do think contract managements and CLMs are an opportunity to speed up sales cycles, which is super important for earlier stage companies, for technology companies, and others, as well.

Rudy DeFelice (25:24):

Oh, for sure. We've had lots of revenue teams talk to us, and they'd say, "I'm in this position all the time where we're negotiating a deal, and someone will say, 'But you guys gave this term to me last time,' or, 'Whenever I deal with you, I get some kind of concession,' or, 'This is what market is.'" And people are not in a position, often, in the revenue side, to answer that with data. But when they've datafied their contracts, they can be like, "Really? Let's check that out," and pretty quickly figure out, "We've done six deals with you guys, and we've never offered that term," or, "Peers of yours have never gotten that term. And actually, that's not market. We have the data to support that market's a totally different thing." That's very empowering for a revenue team. So, those kinds of things can not only make deals faster, they can make deals better. And in the end, both those things are important.

Alex Su (26:11):

Absolutely. I have an example that I want to share of a story that I spoke with a legal department recently, but before I do, we're approaching about half an hour in, would love to hear what questions you all have. I see that there's no questions asked in the Q&A, but there's a wide range of topics we're open to talking about today related to our theme. We already had the question about my haircut, but anything is on the table, anything you want to talk-

Rudy DeFelice (26:39):

Tell us about your wardrobe, I guess, Alex. We haven't gotten there yet.

Alex Su (26:48):

Anything you want to talk...? But the story I wanted to share, but basically wanted to create a repository or stable of contract clauses to enable their sales team to quickly say, "Here's what we've accepted in the past in sales, and here's what we haven't." And so, I can think of several different ways how that could be important to sales teams, but what about other departments? Who else in an organization would care about what's inside of a contract, other than the sales team and in the revenue teams?

Rudy DeFelice (27:17):

Well, certainly, marketing departments I think is a good example. For example, there's a lot of non-publicity clauses in contracts. There's other things that affect our ability to talk about relationships and stuff. We have a media company client that I mentioned before. One of the things they're trying to do is figure out what latitude do they have in promotions of productions? Well, that's in individual contracts with 150 cast members. So, other than reading 150 contracts and figuring out what that is every time a promotion idea comes up, what you'd like to do is look... That's kind of serial access. That's like our old record players, right? Well, we now have CDs where we can go to minute 140 in every CD and see what's there. Same thing, we can now go into our contracts and find what's the publicity clauses that are in these 140 contracts and get a quick digest of what some of the areas are. So, I think across all business units, there's a reason to know what the restrictions and what the abilities and capabilities are in the obligations we've assumed in dealing with particular clients.

Alex Su (28:26):

Yeah, and-

Rudy DeFelice (28:27):

And then, what [inaudible 00:28:28] that is to datafy contracts or to have somebody to read every contract and digest it. But that's just not kind of a 2020 way to deal with things, right? We're in a digital world now where we can have random access to information, right? We don't have to pore through all the stuff that's not relevant. That's one of the things that I love about your tool, like the clause extraction capability allows you to think about things topically. And sometimes, we want to know what terms are... what particular issues affect without having to access an entire contract.

Alex Su (28:59):

Yeah, and the value of that goes up as you have more contracts. Earlier stage companies, maybe you have 50 contracts in total, probably not a huge lift to do it manually or hire an intern. But these are super important contracts. And so, the more they go up, and especially if your company's... is very acquisitive, or there may be a financing event down the road, we've seen a lot of interest from folks to make sure they get a handle on all their contracts to make it easier for potential acquisition or to do due diligence in a more streamlined way. And that all adds up to some real value. But I think that there's just so many different ways the contracts can be managed differently to streamline things. Neha, if you could, let's put out the last poll question. I believe it's a question about frequency of searching contracts, because I am curious to hear from the folks on the line here, how often are you doing this? Maybe it's often. Maybe it's not.

(29:56):

But let's turn to a... We've got a question here from someone, from Tom. "We have 3,000 contracts stored in Adobe Sign. What would the process look like to datafy these contracts?" And I'll let you take a first cut at this response, Rudy, but what I also would love to hear more from Tom is, what kind of contracts are they, and what would you be interested in looking at? And then, we can come up with some more ideas. But I guess the question, Rudy, is, you've got a whole bunch of contracts stored in some repository, what's the process of turning them into data?

Rudy DeFelice (30:38):

I think the easiest thing to do is to run them through an AI tool that structures them, breaks down into clauses, and provides a facile search engine across them. So, Evisort might have a connector to Adobe Sign, but I know there's a lot of ways to connect with those repositories. So, simple thing is to run it through an AI engine. Secondly, we believe in a human in the loop. So, somebody should look at the first couple as they go through and make whatever adjustments need to be made to the algorithm to make sure that it's working properly. And then I think you could kind of unleash that on the people that need it, and they'll probably come up with lots of reasons to access that that we can't even anticipate in advance. But that's not a hard problem, I don't think. That's the kind of thing we've done many times.

Alex Su (31:27):

Yeah, I'd echo that. I think that is the prime use case for Evisort in terms of how you can get fast wins, because as Tom is sharing more here, he's saying that they're sales contracts, and then, other types of contracts. And that goes towards why having software handle this part of the process is so advantageous. So the first step is to figure out where all your contracts are stored. We have integrations. We have ways to automate the process of bringing contracts in. And then automatically, they get categorized and indexed, "These are sales contracts. These are NDAs. These are..." whatever, what have you.

(32:03):

And looks like you have a follow-up question, Tom. Yes, PDFs work. This is a very common problem, and I'm going to use your question, Tom, to talk about a more broader point, which is... I think it's the getting started part that can be hard, because often, many legal departments, not all, many legal departments that I've spoken to, they may be used to asking for budget for outside counsel work, but they're less experienced with requesting for budget related to software, just because it's not been traditionally something that they need to do.

(32:39):

So, I think by, number one, figuring out where your problems are, if these are problems that technology can solve, figure that part out first, and then, demo these platforms. Evisort certainly isn't the only one out there. And so, if you're going through and you want to see if it could be a good fit, run some example contracts to see what gets picked up. And so, Rudy, when you're working with a client who's getting started on this process, what are some key things to keep in mind as a company is looking to bring on technology in the first place? It might be a legal department that historically has not brought on much technology. What advice would you have for them?

Rudy DeFelice (33:22):

Well, I think being sensitive to the fact that we need to socialize things internally and get support. I think the two things I would try to do is I would try to find an immediate use case where we know we can show value. Secondly, I would back that up with the broader vision, which is once we build this infrastructure, we'll also be able to leverage it for much more exciting and maybe unknown, but likely, strategic intelligence reasons down the road. So, I think both those things are an important thing in terms of getting support internally.

(33:56):

In terms of execution, the execution's not that hard on this. AI used to have the highest BS factor of any technology. But I think it's come around now. A good friend of mine at a law firm described an early proponent as the PT Barnum of AI. There was a lot of that going around. But it's proven now. I mean, we've had several installations that we can speak from experience that it's practical at this stage.

(34:29):

So, I think it's relatively easy to go through, categorize your contracts. And you can use it a couple of ways. You can clean up a system you already have. You essentially run them through the cleaner, so to speak, take your contracts, run them through, get all the data, and then put it back in an existing system, so if people are used to using that now, they'll just have a better experience. They'll have more data in there. But in a tool like Evisort, at least, you also have a really flexible interface to access things another way, and you kind of get those together. So, it's pretty easy to make a pretty significant difference these days.

Alex Su (35:04):

That's right. And I have a comment here from someone saying that typical e-signature tools out there probably shouldn't be used as a contract management system. I agree. And I also think that it's understandable why many legal departments that have limited resources may be using tools that they have access to, but might not be the best tool for the job.

(35:30):

And so that's why I think part of our job is to share how these tools are leveraged. I think it's easy to say, "This is a contract management system that will help me find my clauses to find areas of risk very quickly." But this takes us back to the theme of the topic today, which is, if you frame it that way, it's going to be very hard to bring on technology. But if you can frame it as, "This is going to enable revenue," something that's very near and dear to the company's heart, not only will it be more likely that you'll be able to bring that technology on, but you'll also be able to change your own reputation internally, which I think... It helps you develop a reputation that you're thinking about things more broadly, not just only for legal. That's just my two cents from my experience. I would love to hear more from the listeners out there. Obviously, I speak with a lot of in-house lawyers, but you all have your perspectives.

(36:30):

So, I think the process of bringing on new technology, then, if you're going through that process, once you've selected a vendor to solve a specific problem, what are some areas you got to watch out for, Rudy, since you've helped a lot of companies with this type of process? Whether it's a change management thing or if it's a technology implementation issue, what are some areas you've got to watch out for as you bring on new technology to get access to those insights?

Rudy DeFelice (36:57):

Well, I suppose it's contract intelligence, datafying of contracts. It's the same kind of technology adoption challenge you have with everything. It's to understand how it's going to impact people. It's to make sure it doesn't require a whole lot of change in people's behavior, and that, in the end, it's adding to the environment. It's making people's lives better. It's making revenue better. So, it's really the same story with any technology.

(37:24):

I think with respect to contract intelligence, one of the exciting things is, from the entity's point of view, this is relatively untapped value. Most people, even if they have contract management systems, they treat them as repositories more than anything else, and we need repositories, but they're not live. It's not a flexible tool that we're interacting with that's telling us things about the business. And I think that's the transition we could go through. So, getting good at telling that story about having some immediate use cases that our colleagues can see, we're going to solve these specific problems right away, but we're going to do this much broader thing through this technology. I think visionary storytelling is a big part of that.

Alex Su (38:05):

Well, yeah, and I love that, because that's a part of the process that... I've done a lot of demos, product demos, but I have not been a fly on the wall in those conversations where people are telling these stories and they are sharing use cases and trying to convince others internally to bring on the tools. So, what are some patterns of effective storytelling that can help convince others in your company?

Rudy DeFelice (38:31):

Are you offering that to the group, or you wanted my thoughts?

Alex Su (38:37):

I'm curious to hear your thoughts, Rudy.

Rudy DeFelice (38:40):

Well, I think all decisions are made with the heart and supported with the head, right? So, I think the head in this is, we've got a couple of specific use cases we're going to solve right away. 100% of the people answered your poll and said, "Of course we've had a search for..." I would've been surprised if we didn't get 100% people saying yes to that. Well, getting better at that and finding specific cases where existing tools aren't helpful, for example, this force majeure thing, everybody's kind of dealt with that to some extent. And we've had people talk to us, said, "We sent this out to an offshore team, and they look through all our contracts." That's a slow and an inconsistent process. It's not great work for whoever's doing it.

(39:21):

Examples like that where we had to solve a specific problem across a whole body of contracts, I think pointing to those and then getting into this broader story about the strategic intelligence that we're going to derive once our whole contract, the whole corpus is under control and datafied, in addition to the risk mitigation aspects that come out of that too in terms of notice and other kinds of things, things that would slip by us in the obligations management world. So I think we need to appeal to a big vision. We need to appeal to a series of quick wins and maybe cast it in our traditional role of there's risk aversion that comes with this too.

(39:58):

The other thing I would say is, everybody's doing this, right? We're a digital transformation company. We find that every company we talk to of size is on a digital transformation journey of one flavor or another. Same thing with getting our handle on contracts, all your peers are going to be doing this kind of thing, so you don't want to be the legal department that is kind of behind your peers and someone asks you a question, "Why can't we do this?" And they do this at these other entities. You'd rather be in front of that. We kind of know which way this is going. We know that, in a short period of time in the future, we are going to have our contracts datafied. It's a big untapped potential. We're now managing it, but not leveraging it.

Alex Su (40:46):

Yeah, yeah, well said.

Rudy DeFelice (40:47):

I'd recommend getting in front of it and being a leader in this area.

Alex Su (40:51):

And I think this is a nice way to focus on the theme of today's conversation. And we're going to wrap up shortly, just given the time, but obviously, I would love talking about this for hours. But what impact does that have on your career, thinking through things through this way? What have you seen happen to people who are willing to be that internal storyteller, that visionary, Rudy? What impact does that have on your career?

Rudy DeFelice (41:21):

Well, short term, anybody who's gone through the budgeting process in a cost center, like we are in legal most of the time, understands the challenges. Every dollar that's spent on service and support is a dollar that goes out of revenue generation. Your colleagues that are going in pitching on things to drive business have a much more charitable audience when they're in budgeting. So, internally, there's a status, I think, that's important. So making that transition for a traditional cost center department, I think is a super important thing to do. It's gratifying. It will open up more opportunities and, I think, affect your status in the organization.

(41:59):

But in terms of individual careers, think about how exciting this is because it's so early. If you're a general counsel or you're head of legal operations or involved in those organizations and you're counted on to manage risk only, and you do that, but you start opening up opportunities that are strategically important to me, I think that's a huge career enhancer. And I've seen that happen. I can't really name names here, but if people look around and they see other presentations that people from my company have done, you will see a few individuals who have had tremendous career advancement that now straddles legal, and they're doing legal ops work, but they're also doing work in other areas. And that's a result of having made this journey. And they've proven that, "I have a strategic vision and ways to help the company, because I have a really good insight on how to tap information."

(42:51):

And like I said right at the beginning of this thing, information is regarded as a strategic asset in an information economy. So, we're in a really good position in legal to make this transition. And I would endeavor to say it's a just more inspiring way to lead your career. Careers are short in the end. Life is short in the end, right, so do big, exciting things. And I think this is a big exciting thing. I don't know if we could throw a poll out to... on the fly like this, Alex, but we asked the question, "Do you look at your role as primarily about risk versus driving revenue?" I'd be curious to know, what do you want your vision to be? What do you want your expectation to be? I wonder if it's the same.

Alex Su (43:28):

Yeah.

Rudy DeFelice (43:29):

I have a feeling that more people would say, "I really want to be part of that exciting part of the business. I really want my career to be part of that impact." And I think grabbing... contract intelligence is one lever to get there.

Alex Su (43:45):

Yeah, yeah. No, that's well-said. And I think you're absolutely right. You want to take your career and take charge of it and maybe move things along in a way that you're not just the person who's just assessing risk. You become related to revenue.

(44:00):

And I'll kind of close off with this, this idea, which is, I spoke with, on the podcast, the head of legal operations for Intel recently. His name's Mike Haven. Some of you may know him. And he has a really great framework for thinking about legal, which is historically, it's a cost center, and it's always got to be absorbing new legal work, because we're living in an increasing regulatory complexity environment, and so, you have to deal with things like privacy and new regulations. If you could show that you manage your budget properly, or at least you're thinking about things the right way, that legal is not just a cost center that's assessing risk, but maybe there's some cost in assessing risk, but there's also some part with revenue, you could build a lot of credibility with finance departments to ask for more budget to do more things, and at the end, those will be career accelerators.

(44:52):

And related to that, if I can make a quick plug, Neha, if you could just share that next slide, the next webinar in our series, we're going to be talking about how you can leverage technology to get ahead of these regulatory changes. With lots of privacy changes coming out, these are going to impact your contracts that are going to require a lot of manual work. And if you can outsource that to technology, you can focus on the items that Rudy and I shared about today, which is relating to the core of the business and revenue. So for folks who are open to it, you should definitely register for the next webinar. We'll be having more of these conversations. Rudy, as we wrap up here today, any final parting words for our group here of corporate legal department folks, and I think a mix of others, as well?

Rudy DeFelice (45:38):

Yeah, I won't go too far down this road, given the time, but we neglected... I neglected to talk at all about cost containment with dealing with outside counsel, and I've talked to Mike about this before, who you mentioned, Mike now at Intel. [inaudible 00:45:49]-

Alex Su (45:49):

Let's talk about it, yeah.

Rudy DeFelice (45:50):

He's very sophisticated in this area, and one of the hard things is getting data that drives decisions, in this, as in most business decisions. And I think that's another area. If you have a series of relationships with outside counsel and certain... what are the correlations we can draw about how to manage that more effectively, that might not be obvious to users, like that AI example with the peer-to-peer lending company? Is there certain groups, certain law firms that are more efficient with certain conditions that might be hidden in our contracts that we wouldn't think of? I think once you datafy your contracts, you can start probing that and interrogating your data collection for those kinds of things, and then manage the relationship with outside counsel more effectively.

(46:35):

So, another story for us to tell internally is, we think there's an opportunity for cost containment, as well. And controlling cost is just as good as driving revenue in some ways. So, Mike's a great example for that. He's done really sophisticated work in this area, but I think kind of the next level in this world is to have the corpus of contracts to start informing this with correlations that might not be obvious.

Alex Su (47:01):

Yeah, that's such a great point. So much of legal work is done by outside counsel, so yeah, that's great that you brought that up, the cost entertainment aspect of it. But listen, we're about out of time, Rudy. Thank you so much for joining us today. I think we all learned a lot from your comments and your stories and your advice, and I hope that everyone will take those lessons away. So, thanks so much for joining.

Rudy DeFelice (47:27):

Well, it was really fun to do, and we're at a really transformational time as we started... And I hope everybody's energized to go out and build the career and the impact that we really want to have.

Alex Su (47:40):

Absolutely. For the attendees, thank you so much for joining. Rudy and I will hang out for a little while, but if you need to go, feel free to, and if you want to ask any questions, also feel free to, but we're going to wrap up here. And so, register for our next webinar if you're interested. And thanks again for coming.

(48:24):

Carol, I see your message. Thanks for coming. Tom and Kimberly, you too, really, really good to hear from you today. Rudy, it looks like we have a question here from Tobias, "Thank you for this. Do you have any suggestions for people who are inspired by this but aren't at companies who are willing or capable to embark on these types of transformations?" Any thoughts, Rudy?

Rudy DeFelice (49:20):

Yeah, I mean, that's a real challenge, right? And I think in the end, most companies would rather not invest in anything. So, it needs to be justified. And one thing might be to try a small proof of concept that solves a specific problem, and it could get more crystallized when people see it in action. So, it could be a toe in the water. That's probably not the environment to talk about the big visionary transformation, but potentially, to have a couple of small wins and build on that. What's interesting about the datafication of contracts is it can be sold as solving a specific little problem, but you kind of get for free the fact that now we've datafied this corpus, and we can start interrogating it for other reasons. So, this might be an interesting area where you can do something contained that people could buy into.

Alex Su (50:10):

Yeah. Yeah. No, that's totally true. I agree with everything Rudy said, and I'll add, part of this is education. We're all learning together on what technology can provide, and so, maybe that day will come when the company changes its mind about technology. I'll tell you, very often, when we do sales calls here at Evisort, it's because contracts were auto-renewed, vendor contracts were auto-renewed by accident, leading to a very high cost, and suddenly, overnight, the company's attitude changes. So coming to webinars like these, talking to folks who have done it before, speaking with people like Rudy, getting that, absorbing their experience, I think, is going to be really helpful and help you prepare for when the time is right. So that's what I would recommend. Keep educating yourself. It sounds like you already are, but it is a challenge, and I totally hear you. But thanks for the question, Tobias.

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