Innovation

Guest post – Must law lag behind in innovation? : The need to encourage legal entrepreneurship


Ramanuj Mukherjee is a fifth year student of NUJS, Kolkata. He is the founder of iPleaders Legal Risk Management Services which works with start-ups. He blogs at A First Taste of Law .

Start-ups are ventures that question the existing business wisdom. Most people create start-ups because of two reasons – they are insomniacs, and they can’t find a place or can’t fit into conventional businesses. Also, usually they are short on cash in the beginning at least. The last decade has been the decade of conspicuous start-ups – the technology companies established in rundown garages became giant corporations like Microsoft, Ebay and Google. However, start-ups have always been there – coming from no-where, engaging in trade that others would not touch or did not think of, minting money in the process. Let’s confess: we love start-ups because of the rags to riches stories.

India should have been a fertile place for start-ups that way – most of us are in rags, and we dream in copious amounts. However, apparently most of our dreams are about bagging the best jobs in the world rather than bootstrapping to start our own companies, so things have not really worked out on the entrepreneurial front until very recently. In the last decade, things have changed bit by bit – until the recession, which worked like a catalyst. Entrepreneurship suddenly seemed much more attractive than ever as job markets dried up. The most convincing evidence of changing entrepreneurial landscape in India can be found in the popular culture – movies like recent ‘Band Baaja Baarat’ (2010) (story of two college grads’ entrepreneurial venture in the marriage ceremony management market) or ‘Rocket Singh – Salesman of the Year’ (2009), books like Rashmi Bansal’s ‘Stay Hungry, Stay Foolish’ that made to bestseller lists and numerous TV programs on startups bear testimony to that. Starting up is on the top of ‘to-do’ lists of the brightest kids at the IITs and IIMs these days. Fests at these places are incomplete without a business planning competition.
Entrepreneurship has been the key to success for almost every lawyer – only the rules are different in case of litigators and law firms. The lawyers who don’t understand business require rehabilitation – generally available in academia and government jobs. Although often such entrepreneurship involves wrestling over clients, petty politics, paying bribes and everything dishonorable that one can imagine, but it’s business nonetheless. Clean business happens when the environment is right and forces of free market economics are allowed to play out under right sort of regulation, and the other type flourishes when license raj and intervention is rampant. In either case, a lawyer doesn’t get to escape entrepreneurship, unless he goes straight to a law firm/ family practice and settles down, and gets paid well for routine work from the very beginning.
There have been only a handful of people who have formally ‘started up’ – in the legal area itself (like Rainmaker, Akosha, various LPOs), or non legal ventures (Mooli’s, LST) and even social entrepreneurship (Inclusive Planet). Of course, there are the start-up law firms – in the last two years at least a hundred law firms must have emerged. Trilegal, which was a startup once, is fast catching up with the biggest firms now.
Still, from what I have seen, experienced and studied about the bigger startup scene in India, something is missing when it comes to legal entrepreneurship. And that is innovation. Not enough people are thinking of, let alone working to shower in innovation – there is too much premium on starting another conventional business – be it a law firm, or a coaching center. There is overinvestment in what ‘is’, rather than what ‘could be’. That is why, the legal industry today is a decade behind other professions in technology adaptation. Technology is not adopted for the sake of it, to increase coolness effect, but to increase efficiency and convenience. Increasing efficiency means saving money, creation of wealth. A little tweak here, another hack there can change user experience, client satisfaction, and can generate enormous wealth (if you are not with me yet, think Ebay, or Twitter). This is why the lack of approach of innovation is sad.
What is the true scope for innovation and entrepreneurship in the legal industry in India? The market is not just law firms and lawyers. Legal services are too costly, too inaccessible for the Indian masses. Making a will, for instance, is cheaper and easier in the UK than in India. Anyone can pick up a template from a supermarket in the UK to make his own will. Same for a host of other regularly needed legal documents. These templates are also available online, on CDs, and on do-it-yourself software. In India, the cheapest solution is to find a lawyer in the court area and pay a few hundred for having the document typed, and the lawyer charges usually according to what he thinks the client can pay, which often involves bargaining. After that, the quality of work is suspect, and I being in the legal field myself, find it extremely difficult to find a half decent lawyer at an affordable price for handling cases for my family. Access to quality lawyers and law firms is out of question for 95% of the population.
Services are always a costly model, especially when the service involves substantial skill. Therefore, the primary challenge of the emerging legal entrepreneurs will be to develop product models for providing legal solutions. Their challenge will be to reach the vast majority of Indian citizens who have no access to legal services (or solutions) in the current scenario, nor can they hope to have the same – no matter how grave or important the legal issues they face are – from divorce to succession to contract drafting, raising investment or just taking a loan.
Little of the entrepreneurship skills that a lawyer requires is taught in law school in any way whatsoever. I think that is not surprising, while one can learn business by observing, imbibing through a culture, or just by doing things hands on – teaching business is altogether a different ballgame, assuming it is possible at all. Still, IITs and the IIMs have been the most conspicuous sources of student innovation and entrepreneurship in India. The E-cells and Startup Clubs have helped to bring up a generation of entrepreneurs. Is it not time we think in the similar line for the law schools?

I suggest establishment of entrepreneurship cells in every law school, with enough funds to give seed funding to a few startups every year, from which the entrepreneurial law students can benefit. Basic ecosystem and services such as incorporation, account keeping help, initial training in running a business, access to VCs and showcasing opportunities should be created. This would go a really long way in fostering an effective culture of innovation and entrepreneurship in law schools.



Mathews P. George

Mathews is a graduate of National University of Juridical Sciences, Kolkata. His interest in intellectual property was kindled when he bagged the second position in his second year of Law School (in the prestigious Nani Palkhiwala Essay Competition on Intellectual Property). His stint as a student of Prof. Shamnad Basheer further accentuated his interest in intellectual property. Winner of almost a dozen essay competitions in his Law School days, he was involved in various research and policy initiatives relating to intellectual property. Mathews is, currently, based out of Munich, Germany. He had earlier done his LLM in 'IP and Competition Law' from Munich Intellectual Property Law Centre (jointly run by Max Plank Institute for Innovation and Competition, University of Augsburg, Technical University of Munich and George Washington University, Washington).

4 comments.

  1. Kshitij Malhotra

    Just wanted to highlight one point that you have not factored in.. The time it takes to get legal reliefs in the judicial process. People have inhibitions taking the legal recourse or getting into the process of ensuring legal rights. This in many ways effect the inherent advantages of availing “quality legal services”, and compels the people to look for cheap alternatives.

    Nice post. I see a lot of first generation legal entrepreneurs making a mark in recent times.

    Regards,
    Kshitij

    Reply
  2. Ramanuj Mukherjee

    yes, this is a very valid point – but i believe the bottleneck can create entrepreneurial opportunities too. For instance, there is a great market for affordable/cheaper institutional arbitration. in any case, there is a lot of opportunity to provide legal services even outside dispute resolution – many disputes would not even arise if timely legal service can be given at the right place.

    Reply
  3. i am confused

    I think one more point that most of us in law schools tend to ignore is that even smaller towns can serve as good markets for our services. Most law firms are located in Delhi, Bombay, bangalore and other big cities only. It makes sense to have them here as there is more commercial activity going on there and more prospective clients with heavier wallets. However, the smaller towns also have a lot to offer. Firstly, the same kind of legal services, whether for dispute resolution or not, are needed there as well. Secondly, I am sure the ones who start out there will have an enormous advantage and will surely rise faster because there being a dearth of quality legal services availble (the latter being my presumption, of course).

    Reply

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