Scaling Legal AI and Building Next-Generation Law Firms with Harvey Co-Founder and President Gabe Pereyra

In just over three years, Harvey has not only scaled to nearly one thousand customers, including Walmart, PwC, and other giants of the Fortune 500, but fundamentally transformed how legal work is delivered. Sarah Guo and Elad Gil are joined by Harvey’s co-founder and president Gabe Pereyra to discuss why the future of legal AI isn’t only about individual productivity, but also about putting together complex client matters to make law firms more profitable. They also talk about how Harvey analyzes complex tasks like fund formation or M&A and deploys agents to handle research and drafting, the strategic reasoning behind enabling law firms rather than competing with them, and why AI won’t replace partners but will change law firm leverage models and training for associates. Sign up for new podcasts every week. Email feedback to [email protected] Follow us on Twitter: @NoPriorsPod | @Saranormous | @EladGil | @gabepereyra | @Harvey Chapters: 00:00 – Gabe Pereyra Introduction 00:09 – Introduction to Harvey 02:04 – Expanding Harvey’s Reach 03:22 – Understanding Legal Workflows 06:20 – Agentic AI Applications in Law 09:06 – The Future Evolution of Law Firms 13:36 – RL in Law 19:46 – Deploying Harvey and Customization 23:46 – Adoption and Customer Success 25:28– Why Harvey Isn’t Building a Law Firm 27:25 – Challenges and Opportunities in Legal Tech 29:26 – Building a Company During the Rise of Gen AI 37:24 – Hiring at Harvey 40:19 – Future Predictions 44:17 – Conclusion

• 0:05Speaker 00

  Gabe, thanks for doing this.

• 0:07Speaker 01

  Of course.

• 0:08Speaker 02

  Yeah, thanks for coming.

• 0:09Speaker 00

  Maybe we can just start with, like, for anyone who hasn't heard of Harvey, what is the company? Can you talk about the scale and who you serve today?

• 0:16Speaker 01

  At Harvey, we're building AI for law firms and large in-house teams. We're almost at 1,000 customers, 500 employees. Started about just over three and a half years ago. And so been kind of scaling quickly since then. And kind of you guys were some of our boogie seed investors. So yeah, good to be here.

• 0:36Speaker 00

  Maybe from a most basic perspective on the product, why is it not just, you know, Copilot or TouchPT or Claude?

• 0:43Speaker 01

  Yeah, I think that's how the product started. So when we first raised from OpenAI, we got access to GPT-4. And I think GPT-3 to GPT-4 was such a big model jump that the intuition at the time was just give the model to lawyers and have them play with it. And I think that industry was so text heavy that you got so much value from just interacting with the models. And then I think as soon as you gave it to lawyers, you also ran into all of the sharp edges of the models of they hallucinate, they're not connected to a bunch of our context. And so I would say the past, the kind of first two years of the company were how do we build essentially the IDE for lawyers

• 1:26Speaker 01

  around these models that connect it to all of the contexts you need to be productive as an individual lawyer. But I would say in the past year and going forward, the big problem we're solving is not how do you make individual lawyers more productive? It's how do you make a team of lawyers working on a client matter more productive? And more importantly, how do you make an entire law firm working on thousands of these client matters more productive and more profitable? And so I think when you get to that scale, a lot of the problems you're solving are not just model intelligence problems. They are these orchestration, governance, and kind of all of the enterprise product problems that you run into at at scale.

• 2:03Speaker 02

  You've also been broadening from just law firms into enterprises, into big companies using you in concert with both their in-house legal teams and external counsel. Can you talk more about that and how that's been evolving as well?

• 2:14Speaker 01

  Yeah, so we started selling to the largest law firms. And something that started happening about a year and a half ago was these law firms started showing Harvey to their clients. And their clients both wanted to collaborate more effectively with their law firms. And they also wanted to use this directly in their in-house department. So we recently announced we've signed Walmart, we're working with AT&T, a bunch of these Fortune 500, large private equity firms, Global 2000, kind of the largest consumers of legal services. And what we're starting to build is a platform for the in-house teams to do the work that they do internally. So things like contracting and this long tail

• 2:57Speaker 01

  of all of the legal operations you need to do that you typically don't send out to law firms, but also the collaborative tissue of I'm working on a large transaction, a litigation, I need outside expertise, I want to securely share this data with my law firm. And there's a lot of technical problems there around security, data privacy, that we want to solve so these law firms and their clients can collaborate effectively.

• 3:21Speaker 00

  I think for, you know, we have a largely technical audience, but also, most people don't know exactly what legal workflow looks like.

• 3:29Speaker 01

  Yeah.

• 3:30Speaker 00

  I think before we really started working together, I imagined it as just like, well, what do you mean? I like email my lawyer and he thinks about it and reads a document and then sends something back, right? And there's like redlining involved somewhere, maybe there's negotiation.

• 3:43Speaker 01

  Yeah.

• 3:44Speaker 00

  Can you paint a picture of just what workflow means to you guys?

• 3:48Speaker 01

  Yeah, yeah. And I think a lot of people, when they think about legal, they think of consumer legal. And so I have a lease and I need to get, you know, input on that. That's completely different than what these massive law firms are doing. And so I think a really good example of what these firms are doing that, I mean, you guys will be familiar with. And I think a lot of people in the startup space will be familiar with is what law firms do for venture capital firms or private equity firms. And so VCs, PE firms, they do two main things. You raise money and you invest it. And so the main

• 4:23Speaker 00

  And we do podcasts.

• 4:23Speaker 01

  And podcasts, which is actually important, but there's less legal work there. And the important things you need to do there are fund formation. So how do I structure the entity that is going to hold all that money? And it sounds easy, but if you're a large private equity firm, you have a sovereign wealth fund that comes in. And they say, we need to structure it in this way because of tax implications. Then you have a pension fund that has these other requirements. And so it ends up being this incredibly complex process of how do you draft the limited partnership agreement, which can be 100 pages? Every investor that's investing, you can have 100 and they all have side letters that modify that. And you need to understand if I modify it this way, it's going to have these implications. And a lot of it is the project management that also goes around coordinating all of these products.

• 5:07Speaker 01

  If you're raising, you know, a billion dollar fund. And then, once you've created that fund, there's all the investments you do out of that fund. And so, for example, when we did, you know, any of our series, you need to get a data room. We share a bunch of data. You look at that. You need to understand the contracts we have to make sure that the revenue we say we have is actually structured in the way we've claimed. And, you know, are there litigation, all these things? And so it's this massively complex process of understanding. And I think one analogy, you can think of like, understanding a codebase. But the codebase is all of these contracts and all this legal work. And I think the reason Legal is so difficult is the workflows aren't structured.

• 5:49Speaker 01

  So the same way with programming, it's really hard until these models to build tools for programmers. You basically just had an IDE and then programmers did stuff in all the different languages, but you didn't have like, oh, here's a tool for Python, here's a tool for C++. Legal is kind of the same way. And so I think a lot of why you're seeing traction in programming and legal is I think there's a lot of analogies of these workflows of they're so text heavy. And the workflows until you had these models, you couldn't structure them in the way I think you can now.

• 6:20Speaker 02

  So one of the directions that people are going on the coding side is to build things that are being called like agentic and it's very early on in terms of what agentic means, but basically being able to deconstruct a logic tree in terms of what are the set of actions that you need to take in a certain situation.

• 6:33Speaker 01

  Yeah.

• 6:33Speaker 02

  And then having the AI agent go back and sort of check each one of those items, do it, go on to the next item, double check it against the prior one.

• 6:41Speaker 01

  Yep.

• 6:41Speaker 02

  Do you do that from a legal perspective or is that something that's a little bit more in the future relative to where code is today?

• 6:46Speaker 01

  Yeah, we're starting to do this now and actually like when I was at DeepMind, a lot of the RL research I did was that. And so when we first got access to GPT-4, we had the very strong intuition of, okay, you're going to be able to, you know, string a bunch of these model calls or eventually do things like reasoning models where the full agent is differentiable. And even the first day we got access to GPT-4, Winston went in his room for 14 hours and just redid a bunch of his associate tasks. And when I looked at the work he was doing, it was essentially like this hacky agentic where he said, okay, I would need to go look up this case law, summarize it, take that summary, use it to draft.

• 7:28Speaker 01

  And so seeing him do that gave us the intuition very early on of that's the direction this is going. And you can kind of think of associates as agents. They get this task from a partner that's, hey, I have this high level case strategy. I want to see if I can find a bunch of case law that supports it. Can you go research that, look it up, cite it, write me a memo? And so a lot of the systems we're starting to build look a lot like that. And I think one interesting direction that the code Labs, the research labs are going is building these RL environments where you deploy these agents and they can interact with a code base and see if they can pass unit tests. And in legal, that RL environment is a client matter.

• 8:08Speaker 01

  So you have all of the context of a fund formation, an acquisition, a litigation, and the models are starting to learn, let me go in the document management system and see if I can find this, go in the data room or do case law research, get feedback from your partner. And so I think that research direction is is super, super interesting.

• 8:28Speaker 02

  It's it's really interesting you make this associate analogy because I remember when I led your guys's series B, which I think was maybe two years ago now, it was a while ago. I called a lot of your big customers and talked to the head of the law firm or talked to the head of, you know, some of these institutions. And one of the things that I thought was really striking is number one, they were adopting legal software, which before was really hard to sell into them. And because of what you were doing, being so striking and important, they were adopting you really fast. The second is they weren't threatened by it. And I thought, oh, they'd be threatened because it may augment or eventually replace certain aspects of law, et cetera, or, you know, help sort of change that dramatically. And one of the insights they kept bringing up that I thought was really interesting is they said, as we think ahead, as this sort of AI tooling and agentic workflow spread through Harvey

• 9:13Speaker 02

  and companies like you, how do you think about the future of a law firm? Because instead of hiring 100 associates, of which you assume 10 will be partners eventually, maybe you only need 50, maybe you only need 20. And so are you even hiring enough people to know who'd be a great partner?

• 9:28Speaker 01

  Yeah.

• 9:28Speaker 02

  Because you're you're going to shrink the set of people that are needed to do certain tasks over time. Right? Right now, that isn't true. It's augmentation, it's expanding business, but that could happen in the long run. How do you think about the future of law or what law firms will look like or, you know, the evolution of all that?

• 9:41Speaker 01

  Yeah, this is a great question. I think it's changed a lot in the past couple of years. I think something we are starting to talk with law firms a lot is, how do we think of training the future generation of partners? Where to your point, these law firms have these leverage ratios where you have a lot of associates, but much less partners. And there is value to that because not everyone is going to become a partner. And part of going through that process is how you find, oh, this is the person that I would trust to do this very complex acquisition because they've gone through that experience. And so I think the part I'm optimistic about is if I think about. Over 10 years ago, when I learned to program, it was super painful, right? Like you had to go on Stack Overflow.

• 10:24Speaker 01

  It was hard to learn multiple languages because you're like, okay, I'm just gonna like learn Python. I'm gonna learn TensorFlow or something. It was just like hard to even learn that. It was hard to ask questions. When I was at Google, you don't want to ask a bunch of questions because people be like, oh, you don't know that.

• 10:37Speaker 00

  You get stuck all the time.

• 10:38Speaker 01

  Yeah, exactly. And now with the models, it's like programming is so fun to learn because you can just be like, here's how to write this in Python, translate it, why is it written this way? And you can learn this so much more quickly. And we see lawyers doing that with Harvey, where they'll say, generate this merger agreement, why did we structure it that way? And so we're already starting to see some of that. But I think the really big opportunity for law firms is how do they take all of the internal partner feedback and data that they've created and use that to start training? I think that's one big piece. I think another conversation we're having is, to your point, how do you just generally start restructuring firms?

• 11:18Speaker 01

  I think this is one where we have some intuitions, but a lot of it is going to depend on the firm, the region, the size, their specialty, the types of clients they serve. I think one of the things that's very challenging with law firms is they are really a collection of all these practice areas. And so the firms that specialize in litigation look different than the firms that specialize in large transactions versus like midsize transactions. And usually the big firms do a collection of these. And so a lot of what we're spending time is practice area by practice area. Can we go and sit with, here's the fund formation group and their private equity clients and start thinking about what that would look like in terms of the workflows, the staffing, the pricing? And I think it is a really interesting problem where

• 12:03Speaker 01

  a lot of the value in the product and the platform is not just the product itself, but how do we help enable these firms to transform? And so when you think about it from that perspective, like our goal is how do we make these law firms more profitable? And it's not just a product problem, it's thinking about their holistic business and where do we fit in in kind of that bigger picture.

• 12:26Speaker 02

  Yeah, it's really interesting because when you look at The set of functions that a partner fills, and I'm thinking in particular of consulting firms and less about law firms, simply because I'm a little bit more familiar with consultancies. Some of it's the pattern recognition, the high level thinking, the strategy, and then part of it is like the sales.

• 12:41Speaker 01

  Yeah.

• 12:42Speaker 02

  And really being able to make that client connection. And so it's interesting to, to your point, think about more broadly, how can AI augment all parts of their business versus just the legal workflows?

• 12:50Speaker 01

  Yeah. And to your point, I don't think that part changes where it's like, when we think of the like, we're now larger consumers of legal services. And when we think of the best partners we've worked with, I don't think the models are doing

• 13:03Speaker 02

  Yeah.

• 13:03Speaker 01

  what they do anytime soon. And I think what's interesting is I think the role of law firm partners actually doesn't change that much. In the same way, I don't think the role of very senior engineers changes with this because you're largely delegating work and what you're getting paid to do is here's the high level strategy, here's the right abstractions, go write the code or write, do the legal research to help me do it and I will interface with the client. And so I think that my guess is that doesn't change too much, but some of the like lower level functions do change because of this technology.

• 13:34Speaker 00

  One of the things that you said that I thought was interesting, like in another conversation that we were having was that there's an analogy that you could make between like a great senior partner, like a Gordon Moody type.

• 13:45Speaker 01

  Yeah.

• 13:45Speaker 00

  And it's like a distinguished engineer working on systems at Google. Right? I think for a more technical audience or just general business audience that doesn't really know what Gordon Moody does, they might assume what a lot of said, or just like, isn't like 50% of that like his network.

• 13:59Speaker 01

  Yeah.

• 13:59Speaker 00

  Or his reputation. But you know, what you were pointing out is like, there's expertise and the ability to predict like a sequence of arguments that is going to like, get you to the answer you want or manage risk.

• 14:11Speaker 01

  Exactly.

• 14:12Speaker 00

  How does that, how does that translate to an RL environment or a task for you?

• 14:16Speaker 01

  Yeah, this is a good question. So for, maybe for background context for the audience, Gordon Moody was a partner at Wachtel, which is one of the top transactional firms in the world that joined us early on and is now an advisor. And Kind of the analogy I was giving is why is a senior distinguished distributed systems engineer at Google so valuable? And a lot of it is the experience they have architecting these systems that none of this is public, this won't go into the models for a long time. And so if you're building search at Google, these people can just point out, hey, if you build this system this way at this scale, it's going to collapse for some reason that is super not intuitive.

• 14:58Speaker 01

  And one of the examples that Gordon talked about early on was he was a part of when Michael Dell took Dell private and then restructured it and took it public again. And this was like a multi-year, super complex financial and legal restructuring of an incredibly large business. And what he, when you talk with him is incredibly good at is the same feeling as when you talk with a very senior engineer where he can just, he has the whole picture of this legal entity in his head. At the time, they had to do the largest debt offering of all time. They had to create, they had to invent a new financial instrument. And so it's just understanding if I need to raise this much money to do this part

• 15:40Speaker 01

  of the transaction, this is how I would structure it. And so a lot of the value he brings is not just the relationship, but it's just that technical understanding of how you architect these things, the same way that how you architect like very large software projects. And I think when that translates to an RL environment, part of what is missing from the public models is the process of looking at one of these entities and figuring out, given all of the context of I want to do this merger, this is the right way to structure it, just that process.

• 16:17Speaker 00

  That's a reasoning trace, right?

• 16:18Speaker 01

  Exactly.

• 16:19Speaker 00

  For an expert, just like it would be in code.

• 16:20Speaker 01

  Yeah. And if you looked at that data set for one of those transactions, it would be client comes to Gordon, says, I want to do this large merger acquisition. And then there would be meetings and emails talking about, okay, this is the background of the two companies. This is roughly how we would structure them. These are all the things we need to look into. And a lot of the data would be Gordon giving these tasks to associates to say, okay, look into these risk factors of similar transactions we've done. They would do research and say, okay, maybe we could structure it this way. And then he would point out this really subtle thing that, hey, actually, in this case, if you structured it this way, this thing's going to happen. But none of that shows up. Like, all you get from these public mergers is like an SEC filing.

• 17:04Speaker 01

  And so you do see the final result. But most of the value or what you need, I think, to eventually improve these models is the decision-making process, the same way you need these reasoning traces to train these models to do kind of any of these reasoning tasks.

• 17:19Speaker 00

  One of the, as you mentioned, like, the labs are all very focused on RL scaling in, like, coding and math domains.

• 17:30Speaker 01

  Yeah.

• 17:31Speaker 00

  I think those is like highly verifiable, right? Not perfectly so, but like, how do you think about the appropriateness of, like, law for RL, given it's not as easily verifiable?

• 17:41Speaker 01

  Yeah, this is one of the biggest problems. And I remember we had conversations early on when we were trying to figure out what is the right evaluation structure. So I think the hardest thing about legal is most of these tasks are very long-form text generation. And so there are definitely subsets of legal work that are super verifiable of go in this data room and just find all the change of control provisions that you can kind of build these traditional data sets. But for something like generate this merger agreement, it's really hard to just give some binary, like, this is good or this is bad. And I think this has been like a big research problem, like with all the labs we work with and also internally, there is just this open question of how do you build that reward function?

• 18:24Speaker 01

  And if you think of what that reward function is at the law firms, it's the partners, right? Like, at the end of the day, there is no way to verify this besides the senior partner who's done a bunch of these said, yeah, this looks pretty good. And so internally, these law firms have a bunch of data of here's all the edits that went into this and the feedback. And so we are starting to think about how do you use that to train these reward functions? But I would say that is one of the really big problems. But I think one of the interesting things is I think you actually have the same problem in programming where I think in the short term programming is verifiable, where you can look at unit tests. But once you get into real software engineering, like the unit, there is no unit test. It's like I deployed.

• 19:07Speaker 00

  System design.

• 19:08Speaker 01

  Yeah, it's like I deployed this and a million users used it for six months and it didn't crash. And so you get, and it's like mergers are the same where it's like you can make sure the filing is correct, but at the end of the day, it's like three years later, the companies are still merged and they didn't take on litigation they didn't expect or something like that. And it's like, that is eventually the really valuable human experience, right? That's what you pay really good software engineers or really good lawyers where they have that decade long track record of they can build these systems and they haven't fallen apart. And a lot of these stuff, the same way you can't unit test, it's like hard to verify. So it is, I think, this really interesting, open research problem.

• 19:46Speaker 00

  One thing that you guys are doing on sort of the other end from pushing the bounds of what Harvey products and the models can do is like just get them deployed. And you recently started this for deployed engineering force.

• 20:02Speaker 01

  Yeah.

• 20:02Speaker 00

  This is confusing to me because I'm like, well, you're not necessarily like an application building company, which is how people have traditionally thought of FTE. Like, why are you doing this?

• 20:12Speaker 01

  I would say the model that we're operating under is not a full palantir, let's go into the code base and kind of build custom software. I would say this is closer to like Sierra's agent engineering program. But what we're starting to run into a lot is, I think, early on, we did a really good job of building a horizontal platform. We did not that much customization for customers in the sense of building specific things for specific customers. I think the thing that was nice about legal was we could build things like workflow builder and things into the product that would let customers customize the product.

• 20:54Speaker 01

  And then for very large customers like PWC, we did some customization. But now we're getting to the point where when we're starting to talk with law firms about, hey, we want to take a bunch of this data and help you build a model or build agents. There is some amount of we need to go in this environment into your environment and figure out how to connect all the data. We're starting to connect to a lot of their like business systems. So their billing systems, governance systems, and then especially when we start working with the Walmarts, the very large banks, the Fortune 500. They're much less standardized than these law firms. And so there is just this massive amount of work where we go to a large bank and they say, we don't have any document management system for our legal department. Can you just build us one? And

• 21:40Speaker 01

  there is a massive amount of demand of we just want smart, technical people to sit here and help us think about our business and our operations and how we should start mapping that into Gen AI systems. And for us, it's a really good way to figure out the roadmap where, for example, Glual is like one of the fastest growing private equity firms that we recently started working with and they, we meet with them all the time and they're just like, there's all these things that we feel like we could map into Gen AI. We don't quite know what it's going to look like, but let's just sit together and figure it out. And so I would say that's a lot of the genesis of the of the program of how do we just get more people that can work with all these customers and

• 22:24Speaker 01

  start kind of paving the way of some of these new roadmaps in different verticals.

• 22:28Speaker 02

  Yeah, I think what you're describing too is a very standard enterprise playbook.

• 22:33Speaker 01

  Yeah.

• 22:33Speaker 02

  And I think in Silicon Valley, people almost forgot because of the SaaS era that if you're Oracle, if you're Dell, if you're IBM, if you're any of these larger organizations, this is how you sell software.

• 22:44Speaker 01

  Exactly.

• 22:44Speaker 02

  Right? You have a platform, you have a bunch of customization around it. People have bespoke data sets. They may not always have the ability internally or enough people to implement certain connectors or systems.

• 22:53Speaker 01

  Right.

• 22:53Speaker 02

  And this is like the standard way to do it. And then as you do it over and over again, you start repeatedly turning that into part of the platform and so.

• 22:58Speaker 01

  And I think a lot of these started with doing something that resembled FD. And then you get big enough that you get this like implementation ecosystem. There's all these third parties that will come in and implement.

• 23:10Speaker 02

  It'll be like the certified like vendor.

• 23:12Speaker 01

  Exactly. And I think the interesting thing we're actually starting to see is law firms are starting to do this for their in-house clients. So they're starting to go and take Harvey and go to their clients and say, hey, buy Harvey and we'll help you build all the workflows and implement it because we have the scale and the expertise to build this where typically these in-house teams, the smaller ones don't have like the budget or the in-house to build this. And so, yeah, I think there is kind of a lot of.

• 23:37Speaker 02

  And that's like, that could be a good revenue driver for the law firms that you work with in terms of a new line of business that they can offer.

• 23:43Speaker 01

  Yeah, and some of them are starting to think about it that way.

• 23:45Speaker 02

  Yeah.

• 23:45Speaker 00

  I was really struck by, it wasn't, I don't know if it was day zero, you can correct me, but it was within the first year where the very first version of Harvey was really an individual lawyer productivity tool. Right? I'm an associate or a more senior person at a law firm. I want to get a piece of work done. Can you just make it less painful? But the transition quickly to like, how do we transform the business, make the business more profitable, like organize teams, being the ecosystem, I think happened, happened pretty quickly. And like anything that is a business transformation just requires like, you know, a lot of engagement.

• 24:20Speaker 01

  Yeah.

• 24:20Speaker 00

  And so I, given how much you guys have invested in customer success and how that's like driven adoption, I feel like a big piece of it is just how quickly AI has happened.

• 24:29Speaker 01

  Yeah.

• 24:30Speaker 00

  Right? I would not necessarily have predicted that all the customers you're working with would be like, yes, in year one and two of this company selling, we're adopting.

• 24:39Speaker 01

  Yeah.

• 24:39Speaker 00

  But, you know, part of it is you guys are helping them, right?

• 24:42Speaker 01

  Yeah. No, and I think this was, like, when I look back, it was still surprising how quickly some of these law firms adopted this. Like, our first customer, we actually met through, you introduced us to an ex-partner who's doing business school here, and he introduced us to David Wakeling at A and O. That was in our first year and they went from a small pilot to firm-wide and investing in this. And I think. I mean, I think you're seeing this in a couple of verticals with like cursor open evidence where this technology is so transformative for these industries that just are so techs heavy and knowledge based, they just haven't had tools like this, that I think early on, we did find these customers that were like, oh, this is worth really betting on. But yeah, I think the pace has still been pretty surprising.

• 25:27Speaker 00

  I asked the internet through X, what questions we should ask you. And a popular one was like, why aren't you guys building a law firm? Are you going to build a law firm and compete with all your customers?

• 25:39Speaker 01

  Yeah, no, we get this question. And I mean, I think when we first started Harvey and we were doing research, we actually talked to 30 people from Atrium. And I think also, interestingly, Sam and Jason, who was the GC of OpenAI at the time, and was the GC at Y Combinator when they did the Atrium investment. What struck us was the people who worked there said it was a really good idea. And they were super excited about the prospects. And then there were some challenges around the legal and the execution. But when we dug more into it, the big challenge that they ran into was you're essentially just building two different companies, right? You're building a law firm and you're building

• 26:20Speaker 01

  a tech company. And it's already really hard to like, build product engineering, do AI, scale sales. And I think the big issue you run into if you try to do both of these is, I think you can only do one thing well. And doing a law firm well is very different than building a software company well. I think that's one point. The bigger point is, for us, it feels like the best outcome is if we can figure out, how do we make every law firm, how do we help every law firm become an AI first law firm, not how do we build one ourselves? And I think the real problem we're trying to solve is, can we make every law firm more profitable? And a part of that is how they work with their clients.

• 27:03Speaker 01

  And can you make their clients get better, faster, cheaper legal services? And I think solving that equation at scale is a much bigger opportunity than if you build a single law firm because you get conflicted out, you can't scale this. And so I think this is probably like, this is something we don't do, but we've gotten this question. But yeah, I, I think it's kind of not the focus for the company.

• 27:24Speaker 00

  Analogous to other markets in software, law feels like an area where I've been very surprised personally about how, how large the scope of the problem is eventually, if you're really ambitious about what you can do. I didn't realize like you, you were telling me, you know, if you do a really large M and A, let's say of like two global companies.

• 27:45Speaker 01

  Yeah.

• 27:45Speaker 00

  Microsoft, Activision or something. You're like, there's a hundred outside counsel firms here. You know why? Because in New Zealand, where both companies have customers, you have like a tax implication and the dude who understands that lives in New Zealand.

• 27:57Speaker 01

  Yeah. Oh, it's great. Yeah, it's crazy.

• 27:59Speaker 00

  And, and so I, I think like, you know, like other markets, like the SMB version of this looks really different from the like high end enterprise version of this.

• 28:07Speaker 01

  Yeah.

• 28:07Speaker 00

  Um, and so I, I do think it's like hard, it just seems hard to imagine like coalescing all of that expertise in a law firm and a software company at the same time versus I'm like, well, Harvey now has like, what 40 customers in New Zealand.

• 28:20Speaker 01

  Exactly. Yeah. And, and I mean, if you think about those transactions, it's also not just law firms. So there's investment banks and you maybe have P W C or a tax advisor and there could be an H R consultancy that helps you think about how you're merging headcount. And so for us, the bigger opportunity seems, how do we build the platform that lets professional service providers and their clients collaborate? And I think a lot of the problems you need to solve there are like, the biggest is the secure collaboration across many of these entities, the secure data sharing. How do you build and deploy AI systems across these very complex projects? And I think to your point, the scope of this, like legal is a trillion, professional services

• 29:04Speaker 01

  is something like three to five trillion. There's just this massive amount of room to grow and we think our expertise is going to be in building the product, the technical systems, the AI systems that enable that. And we want to give that infrastructure to all of the different law firms rather than compete with them because I just don't think you can.

• 29:25Speaker 02

  I think one of the things that's really striking about this sort of wave or era of AI is that there's Deeply technical people building giant companies in really different industries.

• 29:36Speaker 01

  Yeah.

• 29:36Speaker 02

  And you come from a research background. You worked at one of the major labs in terms of foundation models and other areas, RL environments, reinforcement learning. What has been your biggest surprise in terms of transitioning into being a founder and running a company and building something from the ground up like that?

• 29:52Speaker 01

  They may be maybe not surprised, but biggest like mental model shift is I think the 10 years before Harvey, I was doing a mix of mainly AI research and then trying to start companies, but always largely as an IC. And I think the shift from this started working and scaling, just how much I had to change my mental model of the type of company we're building, how you do this at scale, how you operate. I think that was the biggest surprise or like thing that I've had to had to change, but it's been a crazy experience kind of going from, you know, Winston and I in an Airbnb to 500 people in like three and a half years. And then I

• 30:33Speaker 01

  think also how you build these products at scale and kind of the complexity of this industry, like that has been like a really hard but interesting experience.

• 30:42Speaker 02

  It's been amazing to see what you all have accomplished. You know, it's such a short period of time and.

• 30:46Speaker 01

  I was thinking back to like when we pitched to both of you guys like three and a half years ago and we're like, hey, AI plot for legal. And you guys were like, sounds good. But we like, I mean, we had some of these ideas, but I think they've really like.

• 31:00Speaker 02

  I think a really important aspect of that too is you all started this company before GPT four came out and before a lot of the shifts in the models happened. And so I remember you showing side by side GPT three point five versus four and what you were doing worked on four, but not on three point five.

• 31:16Speaker 01

  Yeah.

• 31:16Speaker 02

  And you were part of that very early wave that had conviction. This was so important as a trend. Was that because of your experience in the labs? Was it something else? Like what drove you? Because not many people were actually starting AI companies when you all got started.

• 31:27Speaker 01

  Yeah.

• 31:27Speaker 02

  And it was kind of just to your point, AI plus legal, like no one was doing that.

• 31:31Speaker 01

  Yeah. Yeah. It's something where now everyone's like, oh, this is such an obvious idea, but at the time, yeah, yeah, text in, text out. But at the time, yeah, no one was thinking about this. I think it was a combination of a couple of things.

• 31:45Speaker 01

  A lot of the best people at the time I had worked with had gone to OpenAI. And so I was working on large language models at Meta. You saw G P T one, G P T two, G P T three. If you were working in A I for the past ten years. Kind of one of the big problems were how do you pull all this together? Because you built systems where, okay, this is really good at vision. This is really good at like specific things, but no one really had the like general solution. And you saw, you saw things like Lambda. And I think with that trend, like what I'd seen is anytime you kind of make that initial, okay, this is how you do it, you can usually just scale and this stuff keeps working. And so with three, three point five, you were like, this is getting really interesting, but it's not quite there.

• 32:30Speaker 01

  And so the bet was, okay, OpenAI may be one of the people to crack it. Like, I know a lot of the people there. That was part. And then I think the other big part was just Winston was a lawyer. And I think we had become super close. Never thought we'd start a company together, but just the way I heard him talk about the legal industry, like he, even though he was a first year associate, just had this intuition of not just the work he was doing, but the structure of the firm. Like, I would hear him talk about the firm and be like, here's what all the different partners are doing. Here's like why our firm's strategy is this way. He had, he was in the process of convincing some partners to leave to start a law firm

• 33:13Speaker 01

  with him, which is insane for like, and so it was just like, okay, this will be really fun. He showed me a bunch of his legal tech. It was like, this seems like the perfect application. And then when we saw G P T four, I was just like, oh, the time is now. Like, this is the perfect, like, application.

• 33:28Speaker 00

  I think it is like really noteworthy, where I was actually like, you know, even six months into working with you guys, being like, well, our capabilities are really going to advance that quickly. And both you and Winston were like, absolutely. Like, we should, we should have the ambition to take on the full complexity of like any type of legal work that's possible, because the models will keep getting better. And it's like, that seems like a, like a, like a super obvious mainstream point of view today.

• 33:56Speaker 01

  Yeah.

• 33:56Speaker 00

  But in. I don't know, in the middle of 2022, I think it was like a, it was a strong, unique intuition to have.

• 34:04Speaker 01

  Yeah. Yeah, I think that was something we did really well, where we just had this belief where I think the same that you see with the programming products, where if you had built something where it's like, all this does is like, check that your Python code doesn't have bugs, which you could have done better with 3.5. Like, you wouldn't have built something like Cursor. And the intuition was just, these models can help you do any programming task in any programming language. And I think we felt that same way in Legal. And I had a bit of intuition, I did like a bit of investment banking, private equity, and it was the same workflows where you could just do any of them with these models. And so I think keeping the product open-ended enough

• 34:45Speaker 01

  that it gave us the room that now we can build into all these things and like professional, other professional services. I think that was super important.

• 34:52Speaker 02

  It's a, it's a really interesting analogy, because for code, it took an extra two years, I think, for the main coding companies to really emerge as the ones that are likely to win.

• 35:01Speaker 01

  Yeah.

• 35:02Speaker 02

  Right? And so you folks started, I think, three and a half years ago, and you had a product almost immediately, and you were up and running really fast. And then I think Cursor didn't really launch its IDE until 24 months ago, something like that.

• 35:16Speaker 01

  Yeah.

• 35:17Speaker 02

  Yeah. And then Cognition was slightly in that era, and then obviously Cloud Code.

• 35:21Speaker 00

  Six months later, yeah.

• 35:22Speaker 02

  And so everything kind of came, kind of in a time-laid way for code, even though GitHub Copilot was one of the first products, and everybody knew that that was really important.

• 35:29Speaker 01

  Yep.

• 35:29Speaker 02

  And I always think that's really interesting, because there were so many coding companies that got started under the premise, but somehow it's these ones that started a little bit later that really were the ones who took off. And so I always wonder, why is that?

• 35:39Speaker 01

  Yeah.

• 35:39Speaker 02

  You know, what caused that?

• 35:40Speaker 00

  My guess is, my, part of my intuition here was just, you guys were like, let's say, like, very,

• 35:48Speaker 00

  AGI is less trendy as word now, but very capability-pilled from the beginning, right? So both you, Winston, and you as a shred of an investment banker turned AI researcher, were both like, it's gonna be able to do so much of this.

• 36:00Speaker 02

  I think all the coding people thought that, too.

• 36:02Speaker 01

  Yeah, they were.

• 36:02Speaker 00

  I think people were, I think people were a little less ambitious, like, three years ago, at least some.

• 36:07Speaker 02

  Some people were gonna go and build giant models, and you know, I actually feel like people are very ambitious. I just think that maybe you folks immediately focused on product, and that was part of the difference.

• 36:17Speaker 01

  I think it was finding the right form factor. And I think in Legal, it was maybe a bit more obvious, where the initial form factor was essentially like, Like the the initial feature we built that none of the products had at the time was upload a document and do something with it, right? And that is a lot of legal tasks.

• 36:34Speaker 00

  Yeah.

• 36:34Speaker 01

  And it was that and then do really accurate citations. And when you showed people that, they were like, oh, this is crazy because that's so much of my job. I think with coding, the initial models were also not quite as good, that you needed maybe a bit more capabilities of the base models. And then you needed, I think, figuring out the right way to like, integrate this into the into the ID. But I mean, I remember where it's like the first version of the product that I built, it was mainly like I used G P T four because like most of my background was like distributed systems and A I research. And I was, I still don't know React. I was just like, yeah, JavaScript and kind of like putting this together. But I'd be like, hey, G P T four, like, help me make this. And like, you could kind of

• 37:16Speaker 01

  already see it at the time with programming. And that was part of what gave me the like intuition that I could analogize to like what Winston was doing.

• 37:24Speaker 02

  But you mentioned that you folks have gone from basically the two founders to 500 people over the last three and a half years or so. You're obviously growing really quickly. The business is working. You know, you have tons of customer demand. What are you hiring for? What are you looking for in terms of the next set of employees? Or what types of roles are you hiring for right now?

• 37:40Speaker 01

  Yeah, on the on the technical side, so we mentioned F D Es. I think looking in general, like across roles of just strong engineers, and then I would say maybe specific callouts. We just hired a site lead for New York, so starting to scale up that office. More folks on kind of front end and scaling product in general, and then more A I folks as well. So, but yeah, anyone, strong engineer, like, please apply.

• 38:08Speaker 00

  Okay, last question for you.

• 38:09Speaker 01

  How many pull ups can you do? Just kidding.

• 38:12Speaker 00

  We did find out. Yeah. Well, I don't know if that was the max, but these guys can both do 15 pull ups, guys. With a wink in the middle.

• 38:19Speaker 02

  We do more.

• 38:20Speaker 00

  Okay, okay, okay, guys, we get it. Um.

• 38:23Speaker 02

  You mean in what set?

• 38:24Speaker 00

  In one set, in one set of three.

• 38:26Speaker 01

  We gotta do the 24 hour challenge.

• 38:28Speaker 02

  Yeah. Oh, what's that?

• 38:29Speaker 01

  How many can you do in a day?

• 38:31Speaker 02

  No, really?

• 38:32Speaker 00

  Yeah.

• 38:32Speaker 01

  It's a lot.

• 38:33Speaker 00

  Yeah, I'm gonna upload to your TikTok.

• 38:35Speaker 02

  Oh, that's cool.

• 38:35Speaker 00

  On the No Priors TikTok.

• 38:36Speaker 01

  Does Elon have a TikTok?

• 38:37Speaker 00

  No.

• 38:38Speaker 01

  Okay.

• 38:38Speaker 00

  I don't know. I don't have a TikTok. Yeah.

• 38:41Speaker 02

  Do you know what TikTok is very good for? Erawan videos.

• 38:44Speaker 01

  Oh, so good.

• 38:44Speaker 02

  Yeah, that's really good.

• 38:45Speaker 01

  So good.

• 38:46Speaker 02

  Yeah, there's some really funny.

• 38:47Speaker 00

  Erawan videos?

• 38:48Speaker 02

  Yeah.

• 38:48Speaker 00

  Like the LA movie thing?

• 38:50Speaker 02

  Erawan or like people like, like there's one where it's, um, the Miami girl visits Erawan.

• 38:55Speaker 00

  Oh, my God.

• 38:56Speaker 02

  She's like, Erawan? Like, are you Juan? So it's very good. I highly recommend.

• 39:02Speaker 01

  I'll have that.

• 39:03Speaker 02

  Yeah, I can send you a couple.

• 39:04Speaker 01

  Yeah, no, that and Twitter.

• 39:06Speaker 02

  That's where all my time goes.

• 39:07Speaker 01

  Yeah.

• 39:08Speaker 02

  These TikTok Erawan videos.

• 39:10Speaker 00

  Okay, you can pick, we'll pick one of these two. I asked some other people involved in the company.

• 39:14Speaker 02

  Okay.

• 39:14Speaker 00

  What question should I ask, Gabe?

• 39:16Speaker 01

  Oh, boy.

• 39:16Speaker 00

  We covered some of them, but one of them was like, why do you still sleep on an air mattress?

• 39:21Speaker 01

  Okay, so I don't sleep on an air mattress. I have a good mattress. I don't have a bed frame.

• 39:28Speaker 00

  Okay.

• 39:28Speaker 01

  Is where that's coming from. And so what happened is when we moved from LA to SF, my bed frame broke. And then the first year and a half of the startup, things were so crazy. I was like, this is what a startup founder should do. And at some point I was like, I need to get a bed frame. And I ordered one and it came. And I got a call from the apartment and they were like, hey, you didn't sign out, you didn't fill out the insurance, like the rent, the movers insurance. So we can't let them bring this up. And I was like, okay, I called them. I was like, hey, do you guys have renters insurance? They're like, we're UPS. We don't, they're just like, we don't do that. And then I was just like, I don't have time to deal with it and I haven't dealt with it.

• 40:09Speaker 00

  And you just gave it on the delivery.

• 40:10Speaker 01

  We have other problems to solve, so.

• 40:12Speaker 00

  Okay, okay. So physically can't do anything except the company right now.

• 40:16Speaker 01

  Yeah, exactly.

• 40:16Speaker 00

  And pull ups.

• 40:17Speaker 01

  Exactly.

• 40:18Speaker 00

  Yeah. Other question was, um. You know, there's a bunch of foresight in starting Harvey when you guys did. When you look forward, do you have a prediction that you think others don't necessarily agree with you right now? That is not mainstream.

• 40:32Speaker 01

  So I have one comment I'll definitely make on the foresight is I think a lot of like, we've gotten comments of like, oh, overnight success. And oh, you saw this coming. And I would say, I actually just spent the decade before Harvey, trying to start a company like Harvey. So I think it was just, I was super early. And then eventually it was like, oh, now is the right time. And then you were kind of in the right position. I, my guess is, I think people now are catching up to how capability pilled, as you called it, like Winston and I were. I think people in Silicon Valley, I think people have a good sense of where these models are going. But I think generally people don't appreciate how much better they're going to continue getting.

• 41:12Speaker 00

  It's hard to internalize.

• 41:14Speaker 01

  It's really weird. Yeah, it's really weird.

• 41:15Speaker 00

  And I build things and I'm like, oh, my God, code gen works. It just really works now.

• 41:19Speaker 01

  It's crazy. Yeah. And to me, it's like, I think the interesting thing will be the transition from like, these models are really smart individually. But if you think about like, a lot of what we've done in the past 20 years with SaaS, it's how do we use software to make these massive organizations? And I think that will be the continued trend where a lot of what we're starting to think about is like, law firms have like 10x in size compared to before computers. And the internet, and I think that's going to happen again, but in like, maybe a different way than the past 20 years. But I think that to me, like a lot of people still talk about co-pilots and individual productivity. And I think a lot of the, the things we're starting to think about is like organizational productivity.

• 42:03Speaker 01

  And like, how do you build these systems at scale where both for our internal engineering team? Like, I think a really interesting question for the, for the cursors, the codexes is like, making someone program 20% faster doesn't make you build a product 20% faster. And so starting to think about like, what is the broader infrastructure you need? So these companies can develop software and product faster and then kind of same analogy to legal. I think that's kind of one of the. Things we're thinking about that I maybe don't hear people talk about as much.

• 42:33Speaker 02

  Kind of collaborative AI in some sense. It's it's sort of like the Figma transition of your individual contributor designer versus working collaboratively with a design team.

• 42:42Speaker 01

  Exactly.

• 42:42Speaker 02

  And what you're talking about is doing that for law, doing that for code, doing that for different verticals and having AIs a layer on top of that. So it's super interesting.

• 42:49Speaker 01

  Yeah. And I I think to that point, it's like, how do how are humans and AIs going to work super effectively? Because even at these large companies, you have huge teams of different specialized people that have different functions. And I think when I hear a lot of people talk about these models, they kind of talk about it as like, oh, AI will just get smart and do all of this. And I don't think that's the way this evolves. The same way, it's not just like, hire 100,000 people and now you've built Walmart. It's like so much of it is like

• 43:15Speaker 00

  Million.

• 43:16Speaker 01

  How you, yeah, 3 million, actually, yeah, how you organize all of these. And I think that will be like, one of the really interesting problems for these.

• 43:23Speaker 02

  Interesting. Yeah, I'm seeing that a lot in the context of both AI driven rollups, as well as this company, Brainco, that

• 43:28Speaker 01

  Yeah.

• 43:28Speaker 02

  helped get up and running where a lot of the AI implementation issues are around people management, workflow optimization. It's much less about can you build the AI and much more, how do you actually change the organization to be able to adopt it properly?

• 43:41Speaker 01

  So. Yeah. And we're starting to work with a lot of private equity firms that I think it's interesting, like, starting to see how they're thinking about that, because I think that will be like, really interesting space.

• 43:51Speaker 00

  Awesome. Thanks, Gabe.

• 43:52Speaker 02

  Thanks for coming.

• 43:53Speaker 01

  Thanks so much.

• 43:53Speaker 02

  Thanks, Jim Plops.

• 43:59Speaker 00

  Find us on Twitter at NoPriorsPod. Subscribe to our YouTube channel if you want to see our faces. Follow the show on Apple Podcasts, Spotify, or wherever you listen. That way you get a new episode every week. And sign up for emails or find transcripts for every episode at no-priors.com.