Private and confidential . Do not share without permission .

2. CONFERENCE OF WESTERN AGs JULY 2016 Private andconfidential. Do notsharewithoutpermission.

3. EDDIE HARTMAN CO-FOUNDER, LEGALZOOM TWITTER: @EddieRHartman EMAIL: ehartman@legalzoom.com Private andconfidential. Do notsharewithoutpermission.

4. BEFORE LEGALZOOM, I STARTED A CHARITY 1 out of 7

5. TWO DIMENSIONS OF HARM

6. WHAT IF WE TOOK THE NON-DOCTORS OUT OF MEDICINE?

7. THESE ARE THE “HEALTHCARE ONLY” COMPANIES

8. MANY OTHERS HAVE A DEEP HEALTHCARE INVESTMENT

9. HEALTHCARE + DEEP HEALTHCARE INVESTMENT

10. THIS IS WHAT IT WOULD LOOK LIKE WITHOUT NON-DOCTORS Largest and Best-Known Hospital Organizations Largest Drug Companies Millions of lives lost or shortened through eliminating drugs, hospitals, medical devices, and means of payment $2.5T and 5MM jobs – 14% of GDP – from this set alone

11. THE REGULATIONS ARE INCOMPREHENSIBLE NEW HAMPSHIRE § 11-27-2  “Practice of law” defined. – “Practice law” as used in this chapter means the doing of any act for another person usually done by attorneysat law in the course of their profession, and, without limiting the generality of the definitions in this section, includes… [New Hampshire] GEORGIA §5-19-50. “Practice of law” defined. The practice of law in this state is defined as: (1) Representing litigants in court and preparing pleadings and other papers incident to any action or special proceedings in any court or other judicial body; (2) Conveyancing; (3) The preparation of legal instruments of all kinds whereby a legal right is secured; (4) The rendering of opinions as to the validity or invalidity of titles to real or personal property; (5) The giving of any legal advice; and (6) Any action taken for others in any matter connected with the law. MICHIGAN MCL 600.916. “Moreover, M.C.L. § 450.681 specifically enjoins corporations from practicing law without a license. . . . However, these statutes fail to define precisely what constitutes the ‘practice of law.’ Rather, such determinations have been left to the discretion of the courts.” NORTH CAROLINA NC 84-2.1 “The phrase ‘practice law’ as used in this Chapter is defined to be performing any legal service for any other person, firm or corporation, with or without compensation…" NEW HAMPSHIRE § 11-27-2  “Practice of law” defined. – “Practice law” as used in this chapter means the doing of any act for another person usually done by attorneys at law in the course of their profession, and, without limiting the generality of the definitions in this section, includes… [New Hampshire] GEORGIA §5-19-50. “Practice of law” defined. The practice of law in this state is defined as: (1) Representing litigants in court and preparing pleadings and other papers incident to any action or special proceedings in any court or other judicial body; (2) Conveyancing; (3) The preparation of legal instruments of all kinds whereby a legal right is secured; (4) The rendering of opinions as to the validity or invalidity of titles to real or personal property; (5) The giving of any legal advice; and (6) Any action taken for others in any matter connected with the law. MICHIGAN MCL 600.916. “Moreover, M.C.L. § 450.681 specifically enjoins corporations from practicing law without a license. . . . However, these statutes fail to define precisely what constitutes the ‘practice of law.’ Rather, such determinations have been left to the discretion of the courts.” NORTH CAROLINA NC 84-2.1 “The phrase ‘practice law’ as used in this Chapter is defined to be performing any legal service for any other person, firm or corporation, with or without compensation…" The definition of what constitutes "the practice of law" or "'the unauthorized practice of law" is by no means uniform, even within the same jurisdiction. - Denckla, D, Non-Lawyers and the Unauthorized Practice of Law, Fordham Law Review (1999)

12. I TRUST JUDY, BUT I HAVE TROUBLE TRUSTING MY GUILD GOAL I: SERVE OUR MEMBERS GOAL II: IMPROVE OUR PROFESSION GOAL III: ELIMINATE BIAS AND ENHANCE DIVERSITY GOAL IV: ADVANCE THE RULE OF LAW GOAL I: SERVE OUR MEMBERS GOAL II: IMPROVE OUR PROFESSION GOAL III: ELIMINATE BIAS AND ENHANCE DIVERSITY GOAL IV: ADVANCE THE RULE OF LAW “My leadership wants to withdraw from the ABA if we don’t have this program deep-sixed” - PA State Bar President Wm Pugh “It just flies in the face of what the ABA should be—promoting bread-and-butter mainstream lawyers across the country” – Pugh “Non-lawyer entrepreneurs seeking to make money on the backs of attorneys looking for work” – NY State Bar President David Miranda

13. CANNOT BUILD UBER FROM CURRENT PRACTICES • ($80K salary) / ($250 hourly fee) = ~20% billable utilization rate • Therefore, solos must be generalists, ready to take any work • This implies many matters are novel • Yet small firms lack tech, and have little ability to improve process • No support staff: #1 complaint: The client did not get called back

14. THE ANSWER CANNOT BE A LAWYER IN EVERY POT

15. WHAT WOULD GOOD LOOK LIKE?

16. RATINGS AND REVIEWS SPECIALIZATION ADVERTISING BRANDING WE MUST EMBRACE EXPERIENCE > license

17. WE MUST EVOLVE TO SERVE CONSUMERS

18. THE UNTAPPED LEGAL MARKET 200,000,000 AMERICANS

19. LEGALTECH ECOSYSTEM

20. OVER $1.4B invested since 2010 YOY FUNDING TRENDS (2010-2015) Source: Traxn Legal Tech Landscape Report (April 2016)

21. RISE IN LEGALTECH STARTUPS TOTAL LEGALTECH STARTUPS (2009-PRESENT) NEW LEGALTECH STARTUPS (2010-2015) 77 485+ 59 400 50 48 27 14 15 Source: Traxn Legal Tech Landscape Report (April 2016) Sources: AngelList.com, LawSitesBlog.com, Traxn

22. FUNDING & GEOGRAPHY FUNDING STAGE 1 GEOGRAPHY 2 Series C+ (6%) Acquired (11%) SF/SV (14%) NYC (9%) Other – Int’l (46%) Series A/B (13%) Seed (70%) Other - USA (31%) 1. CrunchBase (analysis of 117 legal tech startups) 2. Angel List (analysis of 305 legal tech startups)

23. CS Disco Bessemer Venture Partners * US LEGALTECH ECOSYSTEM Acquired Other Anaqua Clio Willing ROSS Intelligence Wevorce Fixed Khosla Ventures Google Ventures SimpleLegal Y Combinator Rocket Lawyer Teleborder* LawPivot* Judicata Law Dingo Clerky SV Angels CustomCounsel* Casetext FairDocument NextLaw Labs UpCounsel Legal.io Ironclad Apperio Occam (dead) CodeX Ross Stanford LEGALZOOM Stanford A&E Lex Machina* Quicklegal Hire an Esquire Xseed Capital Lawtrades Ulu Ventures Cellbreaker SIPX* 500 Startups Bridge US Ravel Everlaw VC Startup

24. COMPARISON METRICS LEGAL TECH STARTUPS (2009-present)… 1%< $1M 30% of seed-funded LT startups obtain Series A funding 2 LT exits (all acquisitions; no IPOs) 3 median seed funding1 …COMPARED TO ALL TECH STARTUPS 5 $500K 40% 22% median seed funding of seed-funded startups obtain Series A funding successfully exit (acquisition or IPO) 1-2. Crunchbase. 3. Estimate (LZ R&D). 5. CB Insights

25. CHALLENGES LEGALTECH STARTUPS FACE 1. VCs with law experience may over-emphasize legal tech’s challenges “There are very few lawyers who become startup investors, and those who do typically shun legal startups.” –KlintCorver, Ulu Ventures “[It’s] difficult to invest in … law … because [lawyers] don’t always act rationally when it comes to economics. [Most] legal startups [will] fail due to [this].” -Jason Mendelson, Foundry Group “Perhaps a knowledge of the law makes you aware of how conservative a profession it is and how slow to adapt, so it makes you more cautious [as an investor]. –Miriam Rivera, Ulu Ventures “The sales cycle for the legal industry is so long … and investors expect … traction [earlier] than we can [deliver].” –Jules Miller, Hire an Esquire “The lawyering business … resists efforts to move fast and break things.” –Wired.com 2. The complexities of the legal industry really do make execution difficult “[It’s] horribly difficult to monetize due to fee-splitting [regulations].” –Alex Halliday, LawPal

26. EDDIE HARTMAN CO-FOUNDER, LEGALZOOM TWITTER: @EddieRHartman EMAIL: ehartman@legalzoom.com Private andconfidential. Do notsharewithoutpermission.