Talking with Erez Bustan, CEO of American LegalNet, a provider of “Desktop to Courthouse” workflow technologies, at ILTACON 2018.
Kevin O’Keefe: Who am I talking with?
Erez Bustan: You’re talking to Erez Bustan, president and CEO of American LegalNet,
Kevin O’Keefe: What does the company do?
Erez Bustan: The company’s in the risk management area. We take reduced risk for law firms. We have a suite of products that do that. We have a calendar and court roles-based system, forms and anything that associated with due dates, and content. That’s what we do.
Kevin O’Keefe: And you founded the company?
Erez Bustan: I founded the company.
Kevin O’Keefe: When did you found it?
Erez Bustan: I founded it in 1996.
Kevin O’Keefe: A long time ago. Relatively long time ago.
Erez Bustan: We came up with our first product really in 2000. But it was an involved process.
Kevin O’Keefe: What were you doing when you found it?
Erez Bustan: That’s an excellent question. I used to own an attorney service. So a lot of the ideas that I came up with was actually seeing the pain points that law firms were going through, from my attorney service business. And that was at a time when the Internet emerged and I looked at how we could take those processes and pain points and turn them to a digital solution for law firms.
Kevin O’Keefe: So when you say attorney service, what were the services that you were providing to attorneys then?
Erez Bustan: Filing ,service of process, research, investigative services, all those. I had about 70 guys working for me. Running to the courts, dealing with law firms, etc.
Kevin O’Keefe: Does that services still exist, or did you sell it?
Erez Bustan: I sold the business and I took that money and invested it in our company.
Kevin O’Keefe: I thought that would be the next step. So you had the luxury, if you will, over some people, of having nothing and figuring out how to live. So you took that thing. You looked at the Internet. How long did it take from the time you looked at the Internet, to go, wow, this is interesting, I can see how I can connect the dots here.
Erez Bustan: I’ll tell you an interesting story. I had a lawyer who, needed the form that day and took one of our guys to Santa Barbara back and forth, spent about 500 bucks on one form, just to get the right content in time to the courthouse. So it took us a couple of years taking it from ID to where it should be, and of course a number of tries, number of tries. A number of those tries have been very successful, but of course we had our failures too, like anything else. But yeah, it was a wonderful, wonderful ride, seeing that vision come through.
Kevin O’Keefe: So using that example of the form out to Santa Barbara and whatnot. Where did it click, as far as what the Internet could do. Tell me what that meant in your mind.
Erez Bustan: One is the pain point, right? Hey, I need it now. I need it digitally and I need to deliver that right away to the court system. So the urgency, the content, the accuracy, and of course the service, the delivery mechanism.
Kevin O’Keefe: How does it get from it’s being created here? You can’t just drop it in at the court house, somebody has to still bring it into the courthouse. Did you have a service that delivered it to someplace in Santa Barbara? So it could be brought to the courthouse?
Erez Bustan: At that time the content was an issue. How do you retrieve content from the court to be able to file it back with the courts? Forms were one of the things, right? So it’s meeting deadlines, meeting the timelines. And we managed to create a digital content of all those paper forms that existed at that time. So the delivery mechanism changed. We took paper forms-
Kevin O’Keefe: So the lawyer could have it right in their hands.
Erez Bustan: Right. I could have it delivered in real time now and be able to file it with the courts now. And there’s a lot of e-filings now and all that. But at those times you had to manually file it.
Kevin O’Keefe: What was your first access to the Internet? I mean, what was the window that got you to the internet. Mine was AOL.
Erez Bustan: Oh wow, that’s a good question.
Kevin O’Keefe: Do you even remember? All of a sudden “oh wow, this internet thing.”
Erez Bustan: Who was the service provider, right? I cannot recall any one was one of them.
Kevin O’Keefe: But it wasn’t like Google where you could still go in and retrieve.
Erez Bustan: No, no, no, no. It was pre-Google.
Kevin O’Keefe: Were there ever low points where you said, I don’t know if it’s gonna work or not?
Erez Bustan: Yes. We were a great believer in the concept, right? In 1998, believe it or not, I was one of the first few 50 people that were sitting in a downtown courthouse with a bunch of other people and trying to form the Legal XML practice. So the Legal XML standards for law firms to be able to file to the court house. A lot of us were visionaries in that field and thought, “hey, tomorrow it’s finally going to happen within them all coming together. Right? Apparently, we’re look at what, 20 years later and only 40% of the courts are filings. So it didn’t turn out to be the way we thought it was going to be, we thought it was going to be a huge market. Everybody was going to benefit, you know. It’s very political and very time consuming and it’s not a vendor friendly environment. We had our successes there too. Orange County was a beautiful success of ours and a finding field, but we had our failures too. A number of courts where we thought it was going to be terrific and going on…It took time.
Kevin O’Keefe: Do you focus on California?
Erez Bustan: No, no, we have a national solution and our vision is actually end to end litigation solutions from desktop to courthouse. We have a calendaring system, court room-driven, in which we calculate the dates for lawyers, have the forms that are associated with those embedded in the notifications that law firms or the lawyers are getting. We have also a pacer solution which is also helping the lawyers process all the receipts right away instead of waiting and also saved them a lot of money, and incurring cost with downloading multiple times the same documents. So we do that and we have also a feed from the court that helps the lawyers to see when and if things change by the court system. So we have it altogether when you as a flow.
Kevin O’Keefe: And you had a nice transition relative to some people that quit their job and whatnot, but was there a point where you really said, “this is really going to work?
Erez Bustan: I still have a frame of these two first checks that came in. So the first two checks that came into the company by two major firms were from Wilson Sonsini and there was from Gibson, Dunn & Crutcher, and I took these two checks, one for $50,000, one for $18,000, framed them and it’s still on my wall. Those were the first two big checks we got. Then I said if they were willing to pay for that concept, I know it’s going to work.
Kevin O’Keefe: Yeah, and that’s so right. I remember when my assistant, when I started my company, she goes, well, why can’t we have them direct deposit certain things? I said, because then I can’t see the check. She goes, why do you need to see the check? I said, I want to see the firm names. I want to see the firm checks, because it’s exactly the same thing, because I know if they will send us a check, other people will too. And there’s little things that are big in the founder’s part, because you need that. You’re walking home and you’re just wondering right until the checks come in and wondering what’s going to happen. What would you tell an entrepreneur that has got that idea for legal tech? We’re here at ILTA and there’s people walking all over the place who haven’t started anything yet – we got some who went to law school, some who just have a fascination with the law – but want to start a company. What do you tell them?
Erez Bustan: The biggest advice I can tell them is be patient. It takes time. You go after the big law firms, it’s going to take your time and so just be patient and be out there, communicate, build a good network – not just with the law firms, but also vendors around the law firms – because they can get you in the door much quicker and build your reputation. It’s all about the reputation. Our company holds 98 percent renewal rates with our products because we have good reputation. Because, especially with the larger law firms, we partner with them. It’s not just about vendor-client relationship. It’s really, really truly partnering with the law firms to understand the pain in order to be able to cater to their services well. So that’s my advice: to be patient, reach out, network and really take care of your clients.
Kevin O’Keefe: Because as a lawyer it was all your name and relationships. What you just said was network, and your name. So you’re talking about relationships and your name. It’s not about the stuff you’re going to hawk, it’s spending time meeting people
Erez Bustan: Absolutely. And earn their trust, right? And earning their trust is by being a great listener. You gotta listen to what the market tells you, you gotta listen to customers. That’s how it goes, that’s how you keep relationships going. be a good listener, you gotta What’s your name and relationship.
Kevin O’Keefe: I forgot to ask you, before you started the attorney services company, what gave you the idea to start that?
Erez Bustan: That’s a good question. It’s actually an opportunity of investment that I had with a good friend of mine who was in that business. So I was investing in different businesses and that was one of them and we, we came across that niche market which was wonderful. It was a good cash flow business. So we enjoyed it very well. And so we saw through one thing after another and that was the opportunity.
Kevin O’Keefe: You went through the side door of like, what’s here? Because you’ve stayed in legal now for over 20 years.
Erez Bustan: It’ll be 20, 25 years. It’s been a while.
Kevin O’Keefe: Thank you very much.
Erez Bustan: Thank you. It’s been a pleasure.