The Impact of ChatGPT on CLM - Zach Abramowitz

Made with speech-to-text software, so a few words may be off.

0:00You're listening to the Contract Heroes podcasts, your one-stop shop for all things contract management. And now here are your hosts, Marc and Pepe. Hello everyone, and welcome to another episode of Contract Heroes. Today on the show, joining us from Killer Whale Strategies, Zach Abramowitz. Zach is the founder at Killer Whale Strategies, and today we're gonna be discussing all things CLM, uh, with some predictions on what's to come in the new year. So without further ado, let's get into the episode. Zach, well, thanks so much for, for joining us. Really appreciate you taking a couple of minutes, uh, to chat. Uh, before I flip things over to Pepe to give, uh, us an understanding of, you know, what we're gonna be talking about, uh, would love to just get a little bit more, uh, of an understanding of your background, you know, how the hell did you get into the CLM space, uh, and where, where are you coming from? Yeah. Yeah. So I've, I've got a little of an eclectic background. So, um, uh, the, I guess the, the sort of unifying theme of everything that I do is, um, law, media, and technology.

1:08Those are my three sort of areas of background. So, um, you know, went to NYU Law, practiced for a, as an M&A attorney for a few years, um, at Schulte Roth & Zabel in New York City. So I have, you know, the, the legal background that's sort of straight, pretty straightforward, although it's probably, you know, the percentage-wise, if you look at my career as a pie chart, probably the, the, the, the smallest actual, uh, experience that I have. But before I was a lawyer, I was also a professional stand-up comedian in New York City. Oh, wow. And then I worked as a producer during law school on the Max Kellerman Show, uh, at ESPN New York. Now Max Kellerman is a big deal with his own ESPN show and on TV and has had a really great media career. But I had a, a lot of influence, uh, from the time that I spent around Max, uh, in terms of, like, my understanding of content. Uh, and then, uh, on the technology side, you know, after I...

2:04When I was at, uh, Schulte, I, I left Schulte to start, um, a startup in the conversation space that was like an early predecessor to Clubhouse. Um, but we were trying to create a kind of a different way to, to publish and consume conversations online. A lot of the websites we worked with at the time were legal publishers. So like my, one of the biggest sites we, you know, I started working with at Reply All was Above the Law. And we had created a kind of conversation widget that allowed you to interview someone over an extended period of time as if you were essentially having a dynamic email exchange with them. And at the ti- And really, the only re- reason I worked with Above the Law to start with was I figured, okay, I'm gonna get data from Above the Law, I'm gonna then show it to other publishers like Huffington Post, like Sports Illustrated, and, you know, both who we ended up working with as a company. But, uh, in order to make the Above the Law thing happen, you know, this is like classic startup wisdom, do things that don't scale in the beginning.

3:01I actually went to David Lat at Above the Law, who was the, he's the, the founder and was then the managing editor, and said, "Hey, listen, I'd like to publish conversations on your website. I think they're gonna do really, really well. And, um, you know, I, I'll publish them on things I think are in- interesting to your audience." And one of the topics that I started publishing about was legal technology, and this is in like 2015. So before the sort of craze of legal tech startups mostly started by, uh, big law or law firm associates who realized, "Hey, wait, Amazon Web Services has come out now. It's not so expensive to start a tech company anymore, and we think we have just as good a chance at hitting it big starting a contract review company as we do trying to make partner at this law firm." And so you got a lot of companies started around that time, and, um, that was when I was starting to write about legal technology.

4:00So what was sort of supposed to be a side gig and really just a go-to-market mechanism with Above the Law ended up turning into me being essentially like a columnist/interviewer on legal tech from about 2015 to 2018. Like, the first company that I interviewed, um... Well, the first person I interviewed on, on Above the Law on the legal tech space was a guy named Noah Waisberg, who was the founder of then Due Diligence Engine, which then became Kira Systems, which just sold to Mi- to, to Terra Micro Systems a couple of years ago. So, uh, you know, that was the first one. The, the found- the s- the CEO and founder of LawGeex was the second. So I, I was able to sort of identify which, uh, legal technology companies were interesting. And that, and around 2018, I decided, you know what? I think that what's happening in the legal technology space is actually a little bit more exciting than the startup that I set out to build.

4:58And so I made a hard pivot and I opened up a consulting company called Killer Whale Strategies, the purpose of which was going to be to help legal teams, law firms, legal departments, um, alternative legal service providers, everyone within the ecosystem who wanted to capitalize on the current disruption taking place in legal, which was something that I had great expertise in 'cause I did it myself. And, yeah, I sort of built a brand off of this, you know, the, the rising tides of disruption. So today, as a consulting company, we help companies very often partner with, um... Sorry for the background noise. We help companies partner with, um, technology companies that we think can give them a competitive edge. Um, we've been behind some of the biggest, you know, law firm technology partnerships out there. Um, we've advised public companies on, on certain legal technology that we think that they should acquire, um, or partner with because we thought there were massive opportunities there for them as well.

6:00Um, so w- we've taken that role of really like, you know, making matchmaking between big companies. The, the next sort of thing that we do is we publish quite a bit of content. So all the research that I'm doing into legal technology, I'm also constantly putting out content. I've got a very active newsletter, legallydisrupted.com. I've got a very active Twitter account. I publish webinars that are sponsored by Axiom that air every Wednes- uh, every other Wednesday at 1:00 PM Eastern. So I, I'm out there publishing quite a bit of content. We also publish some, or, or I would say we create quite a bit of internal content for companies to help drive adoption of legal technology within their business, right? So there's, you know, helping companies, um, either make the case that, hey, this legal disruption is something that we should be interested in. These new platforms are something that can give us an edge.

6:55You know, here's what we have to do. So I've, I've done quite a bit of that as well. Um, and you know, we also give like briefings to a number of law firms and legal departments over the course of the year about like, you know, here's everything you need to know about what's going on in legal technology right now, right? For, for law firms to have to, you know, pay attention to this and, and, and treat it with, um, you know, the seriousness that it requires is almost like hiring a full-time person. What we do as a company is try to understand everything that's going on in the legal technology space so that you as a big organization don't have to. Um, so that's a big part of our feature. And then, you know, the other thing that we do is we invest in companies. The same way that we help companies invest in, in those partnerships, we do it too, right? So if when we think that there are companies that are, that represent a really, really compelling opportunity, we try always to take, you know, take money out of our pockets and invest in, into disruption.

7:59And I think the, the idea there is by investing in startups, it gives us real skin in the game in what's going on in the industry. We're not just out saying, "Hey, we think these companies are great," or, "We think this trend is important," kind of as a clickbait way. Everything that we write about also informs our investing strategy. So that was a, a very long way of saying we do, we essentially three things. We scout companies, we write and talk about them, um, and then we invest in them, and then we help, you know, we help our clients do the same. Wow, that's an impressive background, Zach. And I would say now it makes a lot of sense, like, why are you so good on social media? You have a lot of content up there. Uh, I mean, I, I, I follow you on LinkedIn and Twitter, uh, and I, and I gotta say that your content, it's amazing. And that's why we, we were real excited to have this conversation with you. And, um, and well, there's a lot of tech out there, right? Like you said, between 2015, 2018, they, they just skyrocket all the legal tech industry. But for this conversation, we would like to focus on the CLM space.

9:04I mean- Yeah... there's a lot of, there's a lot of movement out there. There's a lot of vendors, of course. There are a couple of them who are, uh, the, the, the leaders on the market. So, uh, what, what would you say are the trends right now on the, on the CLM space? So I think that let's start with a couple of trends to follow. First of all, I wanna preface everything by saying that generative AI, and you know what most people know is ChatGPT, but this entire wave of companies like ChatGPT, I think they're gonna have massive impact on CLM. So everything that I say, I want you to know I'm gonna sort of give you like the pre-November 30th 2022 version, but then I'm gonna come back and say, "I think a lot of these things could drastically change." So if you'd asked me about this pre-November 30th 2022, I would've said CLM has an adoption problem. It does not have a marketing problem, right? Not always the case. Sometimes it's, it's, you know, it, it's reversed.

10:05It's very, very clear to organizations CLM is something that we should be looking at. Every single survey out there suggests it, but CLM does have an adoption problem. And the, the b- the, the sort of best anecdote I like was at last year's, um, corporate legal operations consortium, uh, event in Las Vegas. S- one of the speakers stood, uh, you know, when they were introducing, uh, the conference said, um, "Everyone here in the room whose organization has a CLM, please stand up." Like half the room stood up. They said, "Stay standing if it's working," and most of the room sat down. So I think that what that suggests to me is there's an adoption issue, um, i- inside of CLM. Why that is, I think is, is, is complicated. Um, there's not like one simple reason and sort of every case is different. Um, but I, I think that that's what I would've said.

11:08The, the, the other, I think part of that issue is that everyone wants to customize, and you guys are more, you know, in this than I am. Everyone wants to customize the CLM to do it, you know, their organization's way, and all of those customizations eventually requires some coding, um, to make it happen. And the, the more customizations you get, the more difficult it is to update the system, the more difficult it is for one central company to, um, to, to create the, the, uh, to, to ship, to ship the code required to make all of these updates while respecting each individual customization, right? So that is a, to me, a huge challenge, or has been to date a huge challenge in CLM, and it, it suggests to me that that's one of the, one of the key issues that's, that's harming adoption, is that everyone wants it their own way, but that ultimately it- Everyone wanting it their own way is, like, very, very difficult for one CLM company to provide for.

12:19Um, so I think the sort of s- the, the side point to that is I think that what we are going to see is the vertical specializ- specialization of CLM, right? Which will mean that, hey, if you want a CLM and you are such and such kind of company, you go to this provider. Meaning, o- one of the bits of advice that I've given companies already is look for CLM vendors and implementation specialists who can show you successful case studies of companies like you. They may not always have a direct match, but ideally you wanna find a company that's been able to cater to companies like you and have success with companies like you. So if you are a, um, fast food franchise, you don't necessarily wanna be using the same CLM as a big pharmaceutical company. You don't necessarily want the same implementation specialists for that CLM.

13:27Um, I, I think people need to get very, very specific because ultimately there's a, there's a, a lot of customization that goes on, so you kind of wanna start off as close as you can, um, sort of to your house before you have to make the trip home, if that makes sense. Yeah. And, and I would say that's a big, um... Well, that, that's the, the, the main issue, right? Because everything goes well once you have the implementation, but once it, it goes live, that's when all the issues start to happen, right? And especially we've, we, we, we've seen a lot with, with, uh, with leads or customers that, uh, a lot of the time they don't have, like, their processes in place. They have no idea. They, they, they think that the implementers would know what they need and how the processes might, uh, uh, might be working better, right? And, and we've, I've also seen a lot of, uh, consulting companies do- that are offering customers this, let, let's call it pre-implementation consulting services. So you can help them to, to i- identify those bottlenecks that are inside their organization, and they can give you, like, a diagnose on where do you need to work on, on how to become more efficient.

14:47Because once you have that information, it's gonna be a lot more eas- uh, uh, it's, it's gonna be way easier for the implementation, uh, the implementation group, uh, or team to know exactly what, what are you going to need. Because, like you said, all the different verticals are different. Of course, they have, like, a, it's, it's all about contract request and the negotiation pro- uh, process, signature and then post-signature. But there's a lot of pieces in, in the, the middle, and that's why I, I think, uh, this, let's call it legal managed services consulting firms are, uh, will be, like, a very, uh, helpful for this adoption to be successful. Yeah. So I, I think that it's a, it's a real, it's gotta be a real challenge for a consultant, because most companies that want to implement a contract life cycle management tool and are prepared to pay for it probably also need a little bit of assistance with their process, and they may not be ready to pay for that. Meaning they, they, they sort of walked into it assuming we need this, and you're telling them, "Yeah, you might need this, but you actually need this."

16:01And, you know, uh, I could imagine for a consulting company, who wants to turn down money? The customer's asking me to, to, to do something for them. I wanna do it. Which you've gotta sort of balance with, "Well, I know that this is what they really need." So I think that's, that's definitely a, a challenge that I've seen. And, and the worst thing you can do with a CLM technology is take a bad process and cement it by putting hardcore technology on top of it. And, and that's, I think, you know, we've seen that lead to a number of problems. I think the, the sort of already notorious case in this industry is Icertis', uh, i- Icertis and Change Healthcare, where health, uh, Change Healthcare is now suing Icertis for a botched implementation. Um, and y- you, you wa- you wonder, you, you kinda wonder what happened there, and if, if maybe process wasn't looked at before they, they, they layered on the technology. Yeah. I mean, I, I think we've...

16:59Well, you know, you live and you learn, right? I, I think when, even when we started doing implementations in this space, um, you know, there wasn't, uh, m- much understanding, especially from, I would say from both sides. But from the customer's side, not knowing, um, what they don't know and, and assuming that a piece of technology, you know, the first piece of technology that probably the legal team was implementing, um, was gonna solve all their issues. A- and, you know, now we, we obviously have to take a step back. You know, customers are, I think, more, um, more okay with, with slowing down. Some of them are at least. Uh, and if they're not, we kind of have to twist their arm a little bit and say, "Hey, you know, these, these first couple of weeks of the implementation, we're not gonna be, um, e- starting to configure anything. I mean, we really need to understand what your processes are so that we can give you feedback before we get halfway through the implementation and need to change everything," uh, you know, whi- which is what we had, had seen in the past. Um, so, you know, I think a lot of, um, organizations like ours have, have learned that we, you know, you need to, to hit the brakes before you can hit the gas.

17:57Um, a- and we're definitely seeing more success with customers because of that. Uh, a- and, and, you know, also, Zach, what you said before about this, this verticalization, you know, I think you're gonna start seeing more, um, more of the, the, you know, top- Five, 10 solutions out there on the market that are also gonna be putting solutions out there that are already pre-configured for- Yeah... for these verticals. Um, and, and we're already seeing that. We're already doing that. Uh, and, and that's been very successful to, to help streamline the, um, the implementation timelines as well as, as gain user adoption because folks are, are more excited to use it the faster that they can. Yeah. Listen, I, I... So one of the companies that I work with is, uh, Gravity Stack, and they're the wholly-owned subsidiary of law firm Reed Smith, and they do quite a bit of work in CLM implementation. And the... one of the interesting things that I, that I've sort of picked up from them is, number one, a huge portion of the CLM implementations that come to them are failed implementations that are trying to reboot, right?

19:01So which speaks to the, to the, to the, to the challenge of, of, of adoption and the challenge of implementing CLMs in general, right? So num- a huge portion of their deals are, are getting there already, you know, with, with some baggage. Um, but I think the, the other thing that I think is, is interesting, um, from a, from Gravity Stack's perspective is they actively pitch themselves as specialists dealing with life sciences, healthcare, and financial services. And it's not like they're gonna turn you down if you're a company looking to implement a CLM a- and, and you're in a different space. But they're gonna be honest with you and say, "Hey, listen, this is our bread and butter." So I think you're seeing it at the CLM vendor level, and I think you're also seeing it at the partner implementation level as w- as well, where companies are trying to do better and do more business by staying in their lane.

20:05Yeah. Yeah, definitely. I mean, that... Yeah. We're, we're... You know, after doing this a number of times, now we're starting to see trends in what type of customers, one, are, are working with us or gravitated towards us, which ones are we having the most success with, um, a- and, you know, we are trying to, to focus on those verticals as well. So I, I definitely agree with you there. Um, and I, I think that, I mean, that's... I think that's clear in any space. I, I think that, you know, we, we were in the help desk and service desk space, and I think we saw the same types of trends happening there, you know, 15 years ago. Right. Um, so I, I... It's just kinda crazy to see how this space continues to mature and that trends are repeating themselves like they always do in, in, you know, other- So, yeah... with other products. A- and I think, you know, what, what I, what I said, you know, I have sort of one pre-November 30th answer and one post-November 30th answer. So count me in the group of people who are blown away by ChatGPT, okay? I, I'm not fence sitting on this one. I'm not... You know, I, I, I think we need to take a moment to, like, just marvel at human accomplishment. This is amazing, right? What it is able to accomplish. Again, I'm, I'm...

21:17There's gonna be all kinds of ethical questions. There's gonna all... be all kinds of legal questions. There's gonna be all kinds of market questions. I, I just think, like, at some point, like, pause, take a deep breath, and just see what this thing is able to accomplish and what it can sort of teach us about ourselves. So I, I'm, I say all, all that by way of intro just to, like, so you know where I'm coming from on this topic because I've seen this looks like one of these issues where you're gonna have to, like, choose sides. So the side I'm on is blown away by, by ChatGPT. I have given some thought to this. I haven't written about this yet, but I'm going to. I think CLM could be one of the huge beneficiaries of ChatGPT. And by the way, I've written articles before. I think, you know, Marc, you know I spoke about one of these. Mm-hmm. I've written an article before on how I wasn't sure that CLM had really gotten to product market fit. It is entirely possible that generative AI could sort of push it over the tipping point.

22:18A- and the reason I say that is that some of the core features that have made it really difficult for CLMs to be implemented have to do with being able to get structured data out of unstructured data, like contracts, right? You want that co- con... And, and it's very, very difficult for the CLM to function well if you can't get that. But there, up to, you know, to this point, there's kind of been companies that are good at the workflow, and there's some companies that are better at the extracted data. But even that has proved to be a challenge. But where we're going with AI feels to me like it's going to be a lot easier and a lot more reliable getting data because the AI that we have right now can't just pick out words within proximity to other words to kind of feel like, "Oh, this is a clause." At a certain level that I haven't really even wrapped my mind around yet, this AI can read. It can read and it can understand, and that's a game changer- Right...

23:21because it, it just means you're gonna have a lot better confidence in what it's pulling from contracts than you would have otherwise, and I think we're seeing, like, tip of the iceberg with what we've seen so far. Um, I, I, I mean, yeah. So the de- the developments in AI, I think, are going to be absolutely huge for CLM. I also think that a huge portion of what makes CLM sort of tricky is drafting, and drafting contracts just looks like it became a lot more seamless. Now, is it, is that ready for live fire, ready to be put into an organization right now? Well, I- Ironclad is doing it, right? In other words, we've seen at least one. I assume we're gonna see others do the same. And I think this could be some of, like, that Product stuff that re- like, in other words, to, in order for product market fit to really take place, you need something to happen on the product side, you need something to happen on the market side.

24:24So I think number one, the market is going to be v- is very, very aware of what's going on with AI right now. It's going to boost the confidence. Like, you have, you know, executives at, at major corporations who are using the same technology that their fourth graders are to, you know, to write essays for, for school. So culturally, I think, like, the market is, is a lot closer. The other thing is, I think this, the, from a product perspective, ChatGPT and generative AI is going to fix some of the things that make CLMs most difficult. The drafting, the extraction of data, and then the last thing I wanted to mention is the coding, right? Because I mentioned before, every time you do these updates, it's just a lot. You got, you gotta write a lot of code. Right now we're seeing developers who are, who are able to find bugs with, with, with ChatGPT, who are able to write code with ChatGPT, and I, I think that what we're s- we're, we're going to see elimination of some of the barriers and obstacles that made these implementations challenging once upon a time. Yeah, that's exactly right.

25:39And so pre-November, of course, there was, there, there's still a lot of hype on the, on the AI. The thing is, like, a lot of vendors were selling it like it was, like, a magic button that just click it there and, and you can get all the data you want. But it doesn't work like that. At least it, it doesn't used to work like that. So let's see how about the generative AI it's going to work. Because a lot of, let's say, the heavy lifting during the implementation process, of course, is the legacy documents, and they don't have structured data there. They, they, they still have to do it, like, manually. A lot of the time they, they say it's an AI, but they have, like, a team in India with 300 people taking the data and putting it- Right... on, on Excel sheets. But this is going to be, like, a game changer, because this is, like, one of the most painful parts of the implementation. Because people want to have the data of their active contracts. They don't want to start working to, with just, like, the ones that they have from go live and, uh, and forward, you know?

26:37And, and also we've seen, like, how other vendors are, are starting to use this type of technology. Uh, we, we, we were in Vegas two, two weeks ago, and Agiloft also published a combo AI where people can start a chat with, uh, with the platform and asking just regular questions. Like, "Hey, uh, I, I want this type of information for all of, all of my contracts." And it can give you all that information, right? I mean, you can still do it with the platform, but you gotta know how to search for it, you know. You need, may- may- maybe you don't know, you don't need to know how to code, but you need to know some, uh, s- uh, strict, uh, logic rules, right? Like, if this happens, then you get this, this result. But now you, you can be just, like, texting- Yeah... the platform and, and do the edits.

27:29My, listen, my, my, my assumption is that you're gonna see basically every one of the CLM companies now try to create something like that, and, and maybe they're using some of the gen AI plat- uh, platforms to do it. Yeah, exactly. I mean, if they wanna keep up, right? You know, we're, we're already seeing, like you said, Ironclad's coming out with something. Agiloft's already come out with something. Uh, and obviously those are two of the bigger, bigger players in the space. Um, what do you, what do you think about, you know, as we talk about, hey, you know, the, as these systems get more complex, um, you, you need to... Well, currently, right? You need to have a better understanding of either highly being able to understand what, what the configuration process is in the back end or, or, you know, with some of the solutions you actually need to know how to code. Um, do you think we're gonna see a rise in more managed services from, from, um, more consulting firms to, to either, you know, these, these companies are just gonna be outsourcing the upkeep of, of their, their CLM tools or, or maybe just even their legal tools in general?

28:33You, you know, I, I've, I haven't paid close enough attention to it as a trend to make a hard prediction. I, I, I just know that that's seems to be what happened in the e-billing space, right? I, I think we, we may see something similar happen within CLM. Um, you know, s- it, it, I think it depends on the organizational design also. Like, some of these CLM implementations will involve a kind of creating a, what they call a contract center of excellence, which is like, you know, the contracting team inside the organization, which is sort of like already like an outsourced team. In, in, in instances where you have that, no, probably you're there, you, you, you keep most of it in-house. But I don't, I don't know how many companies do that. I would... My, my t- my, my sort of guess is the more that are creating those centers though are probably doing less outsourcing of the tools. But yeah, I, I would expect that companies that are putting in CLMs are going to continue having a fair amount of that upkeep, you know, provided as a managed service from a, from a consulting company. Yeah.

29:40Yeah, I, I think it's interesting. A- again, right, I mean, we've just seen it, like you said, e-billing. You know, we saw it in the, the service desk space. I, I, I think it's interesting. Um, and it's definitely something that, that we're, we're keeping an eye on. Um, but you know, I, I think these next couple of months, this next year is gonna be very, uh, very interesting, right? With all the- You know-... with all the changes we've seen in the past couple of months. Yeah. A- and listen, this CLM, I, I've, I, I joked my, I, our company and we invested in TermScout And we led a pretty significant round. And the, and, and TermScout is not a CLM, right? TermScout has built a, a badge that companies can put on their contract, a kind of digital badge, so that when someone goes to sign the contract, they have a very quick and easy way to see, like, "Am I signing a customer f- customer favorable contract or not?" And it allows companies with great terms to flex their contracts, right? So if you're Snowflake, which is a, a user of, of, of the TermScout badge, or IBM, you can essentially say, "Hey, we've got a great contract.

30:46There's no reason for us to have a big back and forth. We're already customer favorable, and you can see it because this third party, third, you know, third, this, uh, this, this third party vendor has given us a badge." Same way, you know, you, you look at Zagat's before you go to a restaurant, you would look at the TermScout badge before you sign a contract. And I, I think it's an absolutely phenomenal product. Part of why I like it is it involves zero implementation. It's literally just putting lines of code on your contract. No one needs to learn how to use anything new. But the reason I mention TermScout is part of the reason I liked making the investment in that company is I, I didn't feel like I could pick a CLM winner. We had multiple opportunities to invest in CLM companies. Some of it even gone through exits since, and we didn't do it because I just looked at the, the, the space and I said, "I, I'm not sure how to pick the winner here."

31:46Um, and what I think is so interesting is if I was right then, like I'm definitely right about it now, meaning it was hard to pick the winner then. Who knew that there was gonna be some technological trend that came around and effectively, I think, made a group of companies put them in a much better position, right? You mentioned Ironclad and Agiloft. I think of both of those companies, and maybe you guys disagree, but I think of them mostly as workflow companies that have had to sort of figure out, how do we, h- how do we get enough AI in here so that our, our workflow can be valuable? There are other CLM companies, by contrast, I think LinkSquares, Evasort, excuse me, which are primarily AI companies. Yep. They're primarily- Yep... data extraction companies that have built a little bit of workflow so that they, you know, so when their customers say, "Hey, listen, what we're looking for really is a workflow solution," th- they've got enough to provide there, right?

32:50Yeah. So dif- different strategies, and you can see that in their marketing. I'm not, like, spoiling any secrets. To me, it seems like if you've been focused on workflow up until now, and you kind of said, "I hope someone else solves for AI," th- that, that strategy is looking really, really good right now. And I think for the last couple of years, Ironclad kind of got hit hard because they were relying on Google, and Google's, Google's AI for contracts was coming in, like, at less than 90% accuracy. So I think up until now that that strategy didn't necessarily look the best. But if you've been building a company that's entirely based on data extraction, and that's the feature where you're the, the most robust and the strongest, I may- maybe they have a different view of this, but it seems to me like those companies are all of a sudden at a disadvantage because they've been investing in building a boat and someone just came out and open sourced airplanes.

34:01Oh, yeah, definitely. And yeah, I, I would say that they're really good, uh, as a workflow. They're like a VPN, they're business process managers. But now with the, all the AI, I mean, right, it's, it's gonna help them a lot more. And also looking for the i- implementation part. I, I, I never thought about it, but now that you mention it, like, using AI to identify bugs, that's amazing because it takes a lot of time. It takes a lot of time, and, and customers can get angry if, if, if you don't solve them. Most of the times it's, like, a very stupid bug or mistake that was part of a rule. But if you can have, have something like that who is not only going to help you to, uh, to just extract data or to build workflow, but to provide a better service, this is going to be amazing for the, for the li- for the CLM space. Yeah. And the other thing that I loved also f- about TermScout is that one of the main pain points of the companies looking for CLM is the negotiation process takes forever. But the thing is like- Yeah...

35:03there's no automation tool that is gonna help you with that. You gotta go in, into the, you know, like, the substance, the, you know, the, the core of the contract, the clauses. What are you putting in there? And if you're only using clauses on one side clause, nobody is going to agree with that, and the negotiation process is gonna take forever. So there's a lot of tool out there that if you know how to bring them together, that's the only way that a company is going to adopt a product like this. Yeah, I, I spoke to a general counsel, um, from one of the CLM companies actually, but they were, they had already put the, the TermScout badge on their contract, and they said, "Game changer. We're... It sped up our deal cycles." And he said, "The reason is, is I don't have to negotiate anymore. Anytime someone wants to negotiate on our terms, I simply point them to the badge. I say, 'Listen, there are...

36:03You, you don't, you don't have to wonder. We have the most customer favorable contract as opposed to all of the other CLM providers.'" And so th- that general counsel was unburdened from doing a lot of that work, but it actually had a business process output, which is that it sped up s- deal cycles at the company, and that wasn't a legal issue. That was, like, a core business issue. So yeah, I'm a big, I'm a big fan of the, of the product. I do think it solves for that stage of, of contracting, which is a huge pain, which a lot of the CLMs don't solve for, and it does it, I think, in a really unique way with, uh, with this badge. Yeah. Yeah. It's, it's, uh, it's, it's cool. I mean, you know, it's something that we've, we've talked in length about before and, and, um, you know, I'm ho- I hope more... I, I don't even know what types of products are gonna be coming out, but I, I think that we're gonna see more of those types of things here in the future, you know, just based on the, again, the changes that we've seen in the past couple of months.

37:04But, you know, I, I... We don't have a crystal ball, but I think we, we've covered some great topics today on, uh, on some trends that we think are, are gonna be impacting the space. Uh, I think it's gonna drastically speed up some of the, the product timelines. You're gonna see things mature a lot quicker. Um, and, and I think overall, obviously, I think that's gonna be great for the customers. Um, but again, you know, I, I don't think that even with this advancement, AI is, is not going to solve all, all, all of a company's issues. So, you know- Right... you do need to, as we always... Right? You gotta slow down before you can speed up. But, but, um, I do think it's, it's gonna help and it, it's gonna change the space, so I guess time will tell. Really fun conversation, guys. Yeah. Thanks, Zach. We appreciate you coming on. A little bit different than our normal conversations, but, uh, thanks everybody for listening to another episode of Contract Heroes, and we hope to have you back here real soon.