Like Washington’s preeminent legal firms, the start-up Clearspire has a Pennsylvania Avenue address within a short walk of the White House.
Inside, however, there are only a few offices — a total of about 3,000 square feet — and even fewer lawyers. People wear jeans. Bryce Arrowood, Clearspire’s chief, isn’t even an attorney.
What Arrowood is, rather, is an entrepreneur who sees the legal industry as broken and has introduced a company that he thinks can turn it on its head. Clearspire, launched in October, promises top legal services without all the things both lawyers and legal clients often complain about. Instead of mind-numbing hours in downtown offices, most Clearspire attorneys work from home. Instead of legal bills based on steep rates charged by a list of faceless associates, Clearspire offers an up-front estimate of how much it might cost to handle a case or service and who exactly will work on it.
Arrowood previously founded LawCorps Corp., a contract legal staffing firm that he sold to MPS Group in 2003. After kicking through a few start-up ideas, he considered complaints about the legal business here and abroad and decided a firm that didn’t pay for expensive office space, didn’t overwork its attorneys and offered more reasonable rates could disrupt the industry.
Arrowood said legal clients are tired of receiving bills showing their money going to lower-level associates whom they’d never met. “These people are being billed at $400 at least per hour. And the clients are saying, ‘Why am I paying to train this guy?’”
To be sure, Clearspire is picking a fight with an entrenched industry built on deep relationships.
The firm’s managing director is Mark A. Cohen, who formerly was an assistant U.S. attorney, a partner at the former Finley Kumble firm and founder of his own boutique firm. He and Arrowood operate under two separate entities within Clearspire to comply with legal guidelines, and they have hired about 10 attorneys so far, many from the general counsel shop at corporations, including from Strayer University, one of the firm’s first clients. The hook is the opportunity to “liberate lawyers to practice law,” by freeing them from having to focus on the business side of things.
“We didn’t tell them they have to go and do rainmaking,” Arrowhead said.
Cohen and Arrowood are also investing heavily in software. The software allows Clearspire employees, most of whom work from home offices outfitted by the company, to meet in virtual rooms and work in collaboration, as well as view relevant documents and billing information. One of the first things new hires do on the job is pose for three photos that become their online avatars — one on the phone, one too busy to be interrupted and one available — which allow their colleagues to begin conversations only when appropriate.
In all, the two have plunged about $5 million into the company, Arrowood said, most of it their own money (he would not disclose revenue). Much of the spending has gone to the software and salaries; he says the company pays more for server space to house its online data than it does brick-and-mortar real estate. And if that works for the legal industry, Arrowood could see trying it again in other fields.
“I think this represents the next step in where we’re going as a society,” he said.