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Atrium lays off lawyers, explains pivot to legal tech

$75 million-funded legal services startup Atrium doesn’t want to be the next company to implode as the tech industry tightens its belt and businesses chase margins instead of growth via unsustainable economics. That’s why Atrium is laying off most of its   in-house lawyers.
Now, Atrium will focus on its software for startups navigating fundraising, hiring, and collaborating with lawyers. Atrium plans to ramp up its startup advising services. And it’s also doubling down on its year-old network of professional service providers that help clients navigate day-to-day legal work. Atrium’s laid off attorneys will be offered spots as preferred providers in that network if they start their own firm or join another.
Atrium lays off lawyers, explains pivot to legal tech

“It’s a natural evolution for us to create a sustainable model” Atrium co-founder and CEO Justin Kan tells TechCrunch. “We’ve made the tough decision to restructure the company to accommodate growth into new business services through our existing professional services network” Kan wrote on Atrium’s blog. He wouldn’t give exact figures but confirmed that over 10 but under 50 staffers are impacted by the change, with Atrium having a headcount of 150 as of June.
The change could make Atrium more efficient by keeping fewer expensive lawyers on staff. However, it could weaken its $500 per month Atrium membership that included some services from its in-house lawyers that might be more complicated for clients to attain through its professional network. Atrium will also now have to prove the its client-lawyer collaboration software can survive in the market with firms paying for it rather than it being bundled with its in-house lawyers’ services.
“We’re making these changes to move Atrium to a sustainable model that provides high quality services to our clients. We’re doing it proactively because we see the writing on the wall that it’s important to have a sustainable business” Kan says. “That’s what we’re doing now. We don’t anticipate any disrupt of services to clients. We’re still here.”
Atrium lays off lawyers, explains pivot to legal tech
Justin Kan (Atrium) at TechCrunch Disrupt SF 2017
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