Kevin O’Keefe: I’m here at Legal Geek and I’m talking with Catherine Krow of Digitory Legal. What is Digitory Legal?
Catherine Krow: Digitory Legal is a cost prediction and management platform for complex litigation. We transform and analyze billing data and use that data to create predictive pricing models and then customers can leverage our platform to manage costs over the life of a matter.
Kevin O’Keefe: So it’s looking at the data from history?
Catherine Krow: Historical data, yes.
Kevin O’Keefe: And you’re sitting there as an outside company and you have to get that data from somewhere, or you’re a licensing solution to the firms so they can do it on their own, or you’re getting a pool of data from multiple firms?
Catherine Krow: We’re getting a pool of data that we can use from the firm, and then we will do the analytics for them and give it back to them in a way that actually tells them what happened, and they can use to cost out cases for their next engagements.
Kevin O’Keefe: How’d you get into this? You’re a lawyer?
Catherine Krow: Yes
Kevin O’Keefe: How long did you practice?
Catherine Krow: Seventeen years.
Kevin O’Keefe: Me, too. Seventeen years. I could have done it the rest of my life I actually, I enjoyed it. I was having fun. When was the moment you said, I think I got this idea?
Catherine Krow: So like a lot of legal tech founders, I started Digitory Legal to solve my own problem. But when you’re a partner, your problem isn’t so much about the practice of law. That’s kind of the easy part. It’s really about the business of law. And ironically, the moment that set me thinking about this path was from the practice of law perspective, probably my biggest success. I tried a case that had huge potential liability or downside and not very many people thought we could win it and we completely defensed it, it was a great victory, and a month later the client pushed back on the bill and I realized at that moment that the market had changed. I saw the rise of legal operations and legal procurement before they even had a name. And I realized that there were so many different ways we could have done better with more cost transparency, better technology, better processes, so I built Digitory Legal to provide that cost transparency.
Kevin O’Keefe: You’re saying you built it, but you’re not a coder.
Catherine Krow: I am not, I am not.
Kevin O’Keefe: And I understand what you mean – you built the concept ant the company – but as you had to get into the development where’d you get that from?
Catherine Krow: So I’m fortunate enough to live in Silicon Valley, and have been there for a very long time, so I tapped into the network. And so my CTO has a lot of successful startup experience. He was the CTO of a company called flutter.com, which was, was bought by Betfair, the world’s first and largest online gaming system. So access to talent like that was something that I had based on time and location.
Kevin O’Keefe: What firm were you with?
Catherine Krow: I was a partner at Orrick for many years.
Kevin O’Keefe: And Orrick was a reasonably progressive firm, it still is. So you maybe didn’t have the hurdles that other people did. Why you, though? To go from a practicing lawyer, doing great work, to having a legal technology company. You weren’t working for 17 years to groom yourself to be a founder and run a company.
Catherine Krow: That is true. And I did really like practicing law. But I realized that there was a moment that the entire industry was changing and I had a choice, I could take that moment and that opportunity to be part of that historical change or I could put my head back down and try cases for bigger companies and harder cases for the next twenty years. I’m more of a risk taker probably than most. I’ve always followed my own path and I wanted to take that moment – it was now or never.
Kevin O’Keefe: What did your partners think of it?
Catherine Krow: I will remember that one person when I told him that I was leaving, said, “well, either you’re going to be calling us up and asking for a job in two years or we’re going to be working for you.” And I decided right then which side of that equation I wanted it to be on. It was very motivating. So I think there was some “how on earth is she going to do it?” But that just drives me harder.
Kevin O’Keefe: Every company that you start from scratch, there are highs and lows. Are there moments where you remember thinking, “oh my god, does it have to be this hard? Am I going to make it through this?”
Catherine Krow: Yes. There have been moments when I’ve thought to myself “oh my goodness, what am I doing?” Part of it is that I am a mother of two, and I’ve found that the only thing harder than trying cases is starting your own company. I moved to London for a large part of this summer and was away from my family to participate in the fantastic MDR Lab program, and that was, personally, very difficult, but professionally great. So there have been challenges, but we’ve overcome them.
Kevin O’Keefe: What was the moment when you thought “this is going to work?” I remember for me it was when the first check came. And I’d ask them to send a check, because I wanted to hold a check from a major law firm in my hands.
Catherine Krow: I can neither confirm nor deny that there is a picture of that somewhere on a wall somewhere. I mean, signing the first enterprise customer was a huge moment, but some of it was, I was fortunate enough, perhaps just the curiosity factor, to get connected to and time with some very high level players in the industry. And having access to those folks and showing them a Beta and having them go, “I need that.” That was an injection of adrenaline that no verdict could give me. So there have been moments like that.
Kevin O’Keefe: Have you self-funded the company, or did you get investors? What did you do?
Catherine Krow: A combination of bootstrapping and angel investors?
Kevin O’Keefe: And how long did you bootstrap it, or did you go out and get capital right away?
Catherine Krow: It was a combination right from the get-go. I had a number for bootstrapping we were willing to do, and then we needed to know that there was flow coming in from angels and particularly people who knew the space. So both.
Kevin O’Keefe: There’s other people here today, like you were before you started the company, who have an idea like you did. What would you be telling them? Or what feedback would you give them?
Catherine Krow: Understand that this is the hardest thing you’ll ever do in your life and it is not for the faint of heart, so you gotta want it and know what you’re getting into. You’re gonna work hard, you’re gonna have highs and lows. There are some stats out there, the sales cycle is tough, so you really need to believe deeply in what you’re doing and have a plan. And don’t just look at the Silicon Valley startup stories like it’s just some overnight success. There are blood, sweat and tears in this before you break through.
Kevin O’Keefe: But it becomes the new normal when you’re in it, because it’s totally different than when you’re practicing law.
Catherine Krow: It is very different from practicing law, but like I said, I found the only thing harder than trying cases is starting my own company.