AI could reshape billable hours at Cooley, but its boss says bring on the change
A business model under pressure
Law firms have traditionally charged clients for lawyers’ time. AI can complete some tasks much faster, raising questions about what clients should pay for and how firms will need to organize their teams.
The shift reaches beyond billing. Companies are using software to begin legal work themselves, and some tasks may not be sent to outside counsel. Law firms are also reconsidering how associates gain experience.
Cooley’s growth and reach
Cooley reports that its gross revenue climbed from $912 million in 2015 to $2.4 billion last fiscal year. The firm has worked with technology companies including Nvidia, Uber, Snowflake and Zoom.
Since 2016, Cooley has advised issuers on 183 initial public offerings that raised nearly $59 billion, according to Deal Point Data. That made it the second-most active firm by deal count, behind Latham. Proffitt declined to discuss reports that Cooley secured OpenAI’s IPO work.
Tools for clients and lawyers
Cooley launched a tool with Legora that allows Y Combinator founders to review common contracts without contacting a lawyer. OpenAI helped develop a tool for Cooley lawyers preparing paperwork for companies going public.
The firm is also working with Google on an AI agent that checks documents for confidential information before court filing and proposes redactions for lawyers to review. Proffitt says giving clients technology can build connections, even if they do some work themselves.
Firms prepare for change
Law firms are investing in technology and building their own tools. Kirkland & Ellis has committed $500 million to proprietary software and is developing a private equity fundraising platform with Palantir. Latham bought Nvidia servers to customize models in-house.
Cooley has created Cooley AI, a wholly owned subsidiary led by Wang and designed to work at a pace closer to a startup. Wilson Sonsini, meanwhile, offers self-service tools for basic legal tasks.
Key points
- Cooley’s gross revenue rose to $2.4 billion last fiscal year, from $912 million in 2015.
- AI may change legal billing, associate training and which tasks clients send to outside firms.
- Cooley is developing tools with Legora, OpenAI and Google.
- Cooley AI is a wholly owned subsidiary intended to operate at startup speed.