Having shaken up the world of bricks-and-mortar retailing, technology entrepreneurs use cut-price, online offerings to disrupt pricey professional services for example law and recruitment.
30 minutes using a city lawyer costs a minimum of $200, but clients from the newly launched LawPath website can consult a professional practitioner for only $29. On the opposite end in the spectrum, engaging legal recruitment may mean a placement and other hefty fees. But not in the event you engage them from the hour, online, on RecruitLoop.
Technology entrepreneurs are using cut-price, online offerings to disrupt professional services such as law.
Technology entrepreneurs are utilizing cut-price, online offerings to disrupt professional services such as law. Photo: JESSICA SHAPIRO
Paul Lupson is chief executive of Lawpath, a start-up financially backed by Ludson who recently successfully exited budgetplaces.com, technology lawyer Nick Abrahams, partner at Norton Rose Australia, and technologist Andy Rose.
Lupson says the site allows people who wouldn’t normally be capable of afford a lawyer to get an initial consultation for little outlay. Customers pay the low fee to inquire about a subject, LawPath pockets the charge and farms the enquiry in the market to a specialist lawyer who consults totally free. In exchange, lawyers may convert the session in a contract for further work, something Lupson says has happened in 50 % of cases.
Lupson insists the arrangement is win-win, with business and private individuals receiving professional advice and lawyers generating leads. Besides, lawyers’ modus operandi is overdue for a re-think, he says.
“The legal profession is amongst the last channels to be modernised. I truly do view it as a disruption but not inside a bad way – in an efficiency way. It’s about finding out how the internet can facilitate connecting with clients.”
The model has found favour using the technology sector, he says, along with it start-ups comprising 50 per cent of clientele currently.
“It’s not devaluing [lawyers’] work – they’re very happy to consider it,” Lupson says. “They’re up for that loss leader.”
The term disruptive innovation is used to explain change that improves a service or product in ways the market did not expect.
Since the development of the internet it’s become increasingly common and happens 1000s of times more frequently than 30 years ago, based on David Roberts, a vice-president of 77dexrpky Valley’s Singularity University.
“Disruption will be all that matters with a start-up,” Roberts told delegates in the Australia Association of Angel Investors conference on the Gold Coast last month.
RecruitLoop founder Michael Overell hopes his venture will provide the recruitment sector an identical jolt.
The web page allows companies to engage independent recruitment consultants by the hour, as opposed to paying commission to an agency in line with the candidate’s salary, each time a role is filled.
RecruitLoop enjoyed a low-key launch eighteen months ago and would be to present an impromptu showcase of its system at San Francisco’s Launch Festival for top-tech start-ups earlier this month.
The annual event includes competitions judged by IT and venture-capital heavyweights including Rackspace’s Robert Scoble and Google Ventures’ Wesley Chan.
The average spend by RecruitLoop customers is $1500 to $2000 per role, which buys 15 to 20 hours of any consultant’s time. RecruitLoop needs a commission as high as 30 %.
For clients, it’s a saving of 80-90 % on fees charged by recruitment agencies, Overell says.
Recruiters are screened prior to being allowed to offer their services using the site and only one in eight gets the guernsey.
“We’re being really tough about maintaining quality,” Overell says.
The company uses 50 recruiters across Australia, New Zealand, Dubai as well as the west coast in the US and wants to expand into other countries as demand builds.