Auxana – Bringing the Gig Economy to the Law Industry

Many fast growing companies in the start-up and scale-up phase have a myriad of legal needs and questions. However, many of them don’t have the budget to take on a full time legal counsel in-house. Other companies in this phase may have only sporadic needs, and require ad hoc legal advice. Plus, all of these companies need to access solid legal advice quickly and cost efficiently. 

Given these factors, engaging traditional law firms just doesn’t make sense for these companies. On noticing a need for transparent, on-demand legal services, Auxana entered the scene in 2019 to fill the market gap. Auxana is a digital marketplace that connects independent attorneys with fast-growing clients across the United States. The platform aims to utilize mechanics of the gig industry to serve customers on both sides of the marketplace. 

“It’s great for attorneys who want to help each other out and build their entrepreneurial practice,” said Valerie Spengler, co-founder of Auxana. 

According to Spengler, in a traditional law-firm, attorneys struggle with both massive overhead costs baked into their rates as well as heavy pressures to constantly increase billable hours to clients.

“Of an attorney’s billable hours, typically they are only taking home around 50 or 60 percent,” Spengler said. The rest of the fees charged to clients cover various overhead costs such as associates, paralegals, office expenses, etc.” 

Gig Economy for Independent Attorneys

By removing the overhead structure, attorneys working through the Auxana platform can take home 100 percent of their billable hours while reducing overall costs to the client. Spengler explains that this is achieved by serving as a marketplace rather than a law firm. 

“We’re not a law firm,” she said. “So, member attorneys are responsible for their own insurance, taxes and such.” 

Think of it as the gig economy for independent attorneys. This affords attorneys the benefit of work flexibility, taking time off as they need it. With the power to manage their own schedule, they have access to a better work life balance that some of their colleagues at traditional law firms can only dream of. 

“Unfortunately, young attorneys have become one of the highest suicide rates – at least in the U.S.,” she explains. Much of this is due to the pressure to pay off massive student loan debt, as well as meeting challenging revenue and billable hour requirements from the firm. This leads many young attorneys to pour more time into their work, with 12-hour work days during the week and weekend hours fairly commonplace in large firms.

The team at Auxana is highly sensitive to the dynamic. To incentivize good mental health, they offer a range of support for their member attorneys. This includes quarterly collaboration sessions where attorneys can connect to solve problems together as a team. The team also held its first annual retreat in October of 2020. While it had to be digital due to Covid-19, they were able to shake things up with virtual meet-and-greets and even trivia games to keep the mood light. Their goal is to create a collaborative environment that helps independent attorneys grow. 

Meanwhile, for clients seeking legal counsel, Auxana is upending the traditional business model by promoting a transparent flat-fee subscription. This helps clients gain access to the counsel they need, when they need it, at a cost-effective price point.

All of this comes at an interesting inflection point for the law industry. According to Spengler, there is a growing trend of non-attorney ownership at law firms. In these situations, venture capital and other finance groups purchase firms with high growth or revenue potential as portfolio investments. The trouble is, this can often exacerbate the pressures to meet profitability goals and further erode work-life balance for attorneys at those firms. 

Post Covid-19 for Auxana

Additionally, much like every other industry, Covid-19 is having an interesting impact on the lawyer-client dynamic. With an increase in work from home arrangements, and outsourcing of work to freelancers or continent labor pools, many companies are beginning to rethink their in-house legal counsel needs. As Spengler explained, some of their client members are large companies who find that the on-demand, flat-fee model better suits their needs in the current marketplace. 

Accounting for these shifts, the team at Auxana are planning interesting developments for year two. In addition to a continuous improvement of their consumer experience and the creation of new channels for customer engagement, they are also building more support tools for both sides of the marketplace. This will mean more marketing support and mental health support for lawyers on the platform, as well as best practice resources for clients.