Rebels with a clause – a new kind of group for a new kind of client

Tech-savvy, dynamic and fast-growing – the Disruptive GC group is on every law firm’s radar. Legal Business meets the hustling new kids on the block

For classists, the word ‘disruptive’ still carries negative connotations of damage, chaos and disarray. But these days in corporate circles it has become the phrase of the day – a complimentary shorthand to describe tech-driven innovators remaking all manner of industries. But the cult of disruption – birthed in Clayton Christensen’s hugely influential 1997 book The Innovator’s Dilemma – has truly come of age when it has reached not only the legal profession, but its in-house branch.

Yet meeting the Disruptive GC network of UK-based general counsel (GCs) or heads of legal working in companies intent on reshaping their respective industries, it soon becomes apparent that this 44-member club means to live up to the aspirational, Palo Alto-infused rhetoric.

‘The thing that ties us together is that we all work in very high-growth, very agile, very demanding and very commercial environments,’ says Neil Murrin, GC and director of regulatory affairs of online train ticket retailer Trainline. ‘There is not much in the way of bureaucracy or hierarchy. The majority of us will day-to-day be talking to the chief executive officer or members of the board, or senior managers. Expectations are very high.’

A wide range of industries are represented in the group, including retail, transportation, tech, travel, food, financial services and well-known entrepreneurial brand names such as globe-trotting taxi-platform Uber, online fashion and beauty store ASOS and food delivery service Just Eat.

And like the companies it represents, the group is growing fast. Established a year ago, with the first informal drinks event in June 2016, the group now has an executive committee that meets once a month and plans to branch out into formal, sponsored events with law firms and third parties.

‘When I joined Made as the first and the sole GC I thought: “This is a lonely existence,”‘ recalls Lisa Gan Tomlins, GC of UK-based furniture retailer Made.com and co-founder of the Disruptive GC group along with Matthew Wilson, interim associate general counsel for EMEA at Uber.

‘When I went to conferences there were particular types of lawyers that I found particularly helpful to speak to – people in very similar situations as me working in disruptive environments – generally very young, fast-growing and backed by venture capitalists. I thought it would be great to create a network and I met Matt, who was very supportive. I co-opted people in as and when.’

The four-person executive committee is rounded out by Christine Cordon, GC of British travel business Secret Escapes, and Karen Kerrigan, chief legal officer of European crowdfunding outfit Seedrs. ‘Lisa was looking for people who were prepared to put in the time and support her personally but who were also representative of different sectors,’ observes Kerrigan. ‘The executive committee has been running for about three or four months and in that time we have launched a mandate, a website and organised a load of events.’

The current executive line-up is in place for the next year, but Kerrigan insists this is a trial run and, if it is successful, others can put themselves forward for the roles on revolving terms. ‘If we want to continue the executive after the year then we can run hustings and people can put themselves forward to be the next members, and we can pass it on and consider the next stage of our growth.’

The executive committee is also responsible for deciding which new members come into the group. Potential new joiners need to apply using a standard Google document on the Disruptive GC website (www.disruptivegc.com).

Compared to the bumbling logistics of the typical in-house counsel group, the slick website has borrowed some lessons from consumer websites, while the process of adding new GCs has a dash of the private member club about it. As in-house talking shops go, this is very much the 2.0 version.

‘When I first joined I introduced people to Lisa by email,’ says Kerrigan. ‘It became more formalised late last year. We need to make sure the types of people that are applying are from the types of businesses that are helpful to keep the spirit of the network. When we do reject people, there has to be an objective reason why and doing it through a form where everyone submits the same information is the fairest way.’ (See ‘In the club’, below.)

 

‘Trying to find advisers – you can share the benefit. It’s like TripAdvisor for lawyers.’
Neil Murrin, Trainline

 

 

TripAdvisor for lawyers

The digitally-literate vibe is carried on through the group’s activities. Communication between members is carried out on Slack – a secure cloud-based team collaboration tool. Within that, members can have individual conversations with other members of the group, share documents or contribute to different ‘streams’. There is currently a range of streams, one covering general issues, a dedicated fintech industry stream, referrals for job vacancies and/or law firm recommendations and a stream for useful events and seminars.

The approach allows the group to easily tap into tailored and responsive note-swapping. Ruth Pearson, GC at property finance marketplace LendInvest, describes the communication style: ‘In the fintech stream there is a lot more discussion around the compliance function, anti-money laundering – the sort of things that wouldn’t be relevant to someone in fashion or travel. A couple of new members joined recently and everyone gets notified. You know who is joining.’

‘Slack allows you to set up notifications on specific words and works across all platforms – for example, both mobile and desktop,’ notes Simon Coles, GC and company secretary at cashflow finance provider MarketInvoice. ‘There is a full list available with everyone’s contact details.’

Pearson maintains that the messaging service is secure and there is no risk of conflict or privilege issues, despite the fact that some members are competitors. ‘Everybody in the group is a lawyer so we know what the lines are in terms of what we can discuss and how far we are willing to go with confidentiality. There is no real difference with having an offline networking system. It has just moved online so it is more convenient.’

Of the GC members canvassed for this piece, a majority use the group at least once a week, with some using Slack on a daily basis. Additionally, most GCs are engaged in all of the different streams and use the group for general questions as well as specific-sector questions, both legal and non-legal.

‘I use the general stream,’ says Wilson. ‘It has helped me think about how I build my team and the skillsets required for young, growing teams. I haven’t hired anyone through the group, but I have made a number of referrals to other GCs in the group.’

‘I have found the adviser referral bit very helpful,’ notes Ahmed Badr, head of legal at online payment service GoCardless. ‘It is hard to find someone you get along with and who provides correct, concise advice that a lot of people in the group are looking for.’

One non-sector-specifc issue often flagged up within the group is the upcoming General Data Protection Regulation (GDPR), the EU’s new data protection regime. Murrin says the group has helped him and other members find the best external specialists in this rapidly emerging field, which has a huge impact on tech-driven businesses.

‘No-one is an expert in GDPR no matter what they say,’ says Murrin. ‘Trying to find external advisers on it – you can share the benefit. You have your own filter or it’s like TripAdvisor for lawyers – who is good, who is not so good. From people you know and judgement you trust.’

With members of fast-growing companies at widely varying stages of development, but still part of the Disruptive GC group – Uber, for example, generated global booking revenues of nearly $11bn in 2015 – a useful part of the conversation concerns the challenges for a previously UK-based company which is expanding into Europe or has plans to go global.

 

‘It doesn’t have to be legal. A lot of the conversations are on operational issues.’
Ahmed Badr, GoCardless

 

 

‘We are starting to do a lot more work in Europe and further afield,’ says GoCardless’ Badr. ‘That is something I asked these guys the other day: “Does anyone have any experience of a firm that is good at co-ordinating that type of international work, such as translation work?” It doesn’t have to be pure legal. There are a lot of conversations that are focused more on operational issues.’

And sometimes the group is useful for offering the kind of support that GCs struggle to find internally, with many the sole GC in a company which lacks any sort of formal infrastructure or defined role for its lawyers.

‘I find it helpful in the softer area of being able to talk to others about some of the challenges of working in a disruptive environment,’ says Gan Tomlins. ‘To share experiences of what it is like to work with entrepreneurs and deal with a business that is growing at double or triple rates without having a team growing anywhere along the same lines. I have had chats with members of the group who have managed to grow their team to three, four lawyers. And it is about understanding what kind of business case you put forward [to hire more lawyers].’

Additionally, often being the sole lawyer in a fast-growth company means many of the Disruptive GCs are dealing with a host of general enquiries or operational issues outside their core remit or skillset.

‘My primary focus is obviously legal and regulatory affairs, but we don’t have the infrastructure of a large company,’ says Martin Cook, GC at peer-to-peer lender Funding Circle. ‘That means you have to take roles in other parts of the business. Recently, I’ve taken a role in government and corporate affairs looking at Brexit. In a large business you’d most likely have a full-time person dedicated to that role, whereas here it was a case of asking: “Who can do this?” Because we have fewer staff and end up interacting with a lot of people, we as lawyers understand the whole business and can take advisory roles on different parts of it.’

‘And then there are the day-to-day queries that people in businesses like this will get coming across their desk all the time,’ adds Coles. ‘Most people in your business assume that because you are a lawyer you know everything about all laws that could possibly apply to any situation. We all have our contacts at law firms who we can phone up and get a quick view on something at no cost, but sometimes they will give you a strict legal answer when you want a business slant.’

Although five broad sectors are represented in the group, fintech companies make up half the membership. It is also the only subdivision to have its own industry stream. E-commerce, covering roughly a quarter of the membership, is the next largest industry sector.

According to Kerrigan, who set up the group’s fintech stream, GCs are generally more prevalent in fintech because the regulatory demands mean there is a responsibility for companies to hire a lawyer earlier on. ‘You will find there are more really early stage businesses in fintech that have lawyers.’

‘The likes of Uber and Just Eat – there are regulations that affect them and will affect their everyday business, but there is that one extra layer in finance because it involves credit, it involves finance, it involves trusting other people with your money,’ adds Coles.

 

Developing disruptively

Unsurprisingly, a group of agile, fast-growth companies has attracted the attention of law firms, with Gan Tomlins and the other Disruptive GCs moving to harness that interest to drive the group’s development.

The group currently meets informally every quarter, but interest from law firms and others is handled by the executive committee, who plan to change the schedule to monthly formal, sponsored events with law firms. The group has tendered these out to a pre-selected list of around 15 to 20 advisers so far.

Turning the traditional concept of tendering on its head – where candidates pitch to sell their services – to get law firms to pitch for the privilege of paying to produce the entire event is a statement of confidence. It also reflects the entrepreneurial hustle in the group that is absent from most in-house talking shops.

 

‘Being a GC at one of these businesses isn’t about law. It is about understanding how management decisions are made.’
Karen Kerrigan, Seedrs

 

 

‘We have specifically asked for proposals from law firms for the subjects that we think are particularly useful and are collating them right now,’ says Gan Tomlins. ‘We have given them a little bit of guidance but at the same time said: “You impress us!” We have had some more creative suggestions than others. We have seen some law firms that have come back and haven’t just said: “We’ll do a talk followed by drinks.”‘

Each of the four executive members has taken a particular area – one legal and one business – for the sponsored events. ‘Being a GC at one of these businesses isn’t just about learning data protection law or the requirements for listing in the UK,’ says Kerrigan, who drafted the request for proposals (RFP). ‘It is also about understanding how management decisions are made. Or learning how to be a leader of a business that comes with founders that are ambitious and want to move very quickly. It is a lot about expectation management as well. This isn’t your average in-house role.’

The executive committee took feedback from members and put together a shortlist of law firms for each future event. Kerrigan’s RFP for all events stated the group ‘did not want drinks and PowerPoints’, leaving requirements deliberately vague to ensure law firms come up with eye-catching ideas.

The first event was organised by Wilson with Baker McKenzie to address ‘international consumer terms across borders’. Described as a ‘breakfast huddle’, it took a debate format with a mixture of Baker McKenzie lawyers and some members of the Disruptive GC group debating two sides of a question.

Notes Wilson: ‘We have done four or five tenders now and the response has been overwhelming. We had four really strong proposals for the consumer event. And all of the firms that responded are interested in maybe two or three other events.’ Other recent topics include ‘Initial Public Offering (IPO) readiness’ and ‘Doing business in the USA’.

Relying on law firm sponsors who are only too happy to provide events free of charge in order to gain access to the group has allowed the Disruptive GC group to remain self-funded, with members only required to pay limited costs. However, according to Wilson, changing the funding structure and making the group into more of an official operation is something that is now being discussed by the executive committee.

‘We tentatively decided that for the first year we will keep things relatively informal on the funding side and we won’t charge subscriptions or anything like that, but we will keep an open mind for the future.’

Such an attitude would be unlikely in law firms, or even in larger, more bureaucratic in-house organisations focused on areas like banking and insurance. However, this flexibility and commercial drive is an indication that the Disruptive GC tag is not entirely marketing – these lawyers are marching to a different tune to their equivalents in plc land. As Gan Tomlins concludes: ‘The events are the main focus. We are talking one step at a time. But we are a group of Disruptive GCs so we will continue evolving.’ LB

kathryn.mccann@legalease.co.uk

Additional reporting by James Wood.