Leading LPM software providers differ over allowing 3rd-party integrations, even as firms and lawyers demand it

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Photo Illustration by Sara Wadford/Shutterstock

As the 2018 Clio Cloud Conference got underway in New Orleans last October, more than 50 companies competed in the inaugural Clio Launch//Code competition to see who could come up with the most creative and innovative integrations for Clio. Tali, a voice-based time tracking system, took home the $100,000 prize and was among five finalists that included ClientSherpa, Logikcull, myFirmData and Your Firm App.

However, the real winner may very well have been the contest’s sponsor.

Established in 2008, the British Columbia-based Clio has grown large in relation to its competitors in the legal practice management software field and in the number of integration partners.

“Clio is the 800-pound gorilla of practice management,” says Robert Ambrogi, attorney, media and technology professional and author of the blog LawSites. Clio boasts 150,000 users in 90 countries, more than 300 employees and 125-plus app integration partners. After Clio, “it’s difficult to gauge market share, as none of these companies reveal customer numbers,” Ambrogi says.

For Clio co-founder and CEO Jack Newton, the company’s growth has been fueled, in part, by its willingness to allow third-party integrations. “Clio can do a lot with its resources but can’t do it all,” he says. “There’s a long tail of features and functionality the legal marketplace needs. No single company can and should try to satisfy those sets of requirements.”

Legal practice management software is most efficient when it integrates with other applications and shares data. Law firms must reuse the data created in LPM software for other tasks, such as managing Outlook email, automating document production and maintaining the law business with third-party accounting applications. It will save time and labor for high-value legal services.

LPM software providers use an application programming interface to communicate with third-party software. An API is a customizable software interface that, among other things, ensures data integrity when users extract information from LPM software to other software.

How software providers use and allow third parties to consume their APIs impacts LPM business and software development. API consumption also has ramifications for two legal industry trends.

Photo of Jack Newton courtesy of Clio

First, competition among LPM providers is heating up. In the 2017 and 2018 ABA TechReports for Practice Management, legal professionals’ adoption of practice management tools had hit a plateau.

Second, law firms are looking to make their operations more efficient. Firms must assess how LPM software integrates with other technologies and fits their plans for cloud computing, mobile and social applications, and the use of big data and artificial intelligence—even blockchain.

The ABA Journal reached out to four top providers of LPM software-as-a-service to discuss its API offerings: MyCase, PracticePanther, Rocket Matter and Clio. We found the API offerings ranged from MyCase, which keeps a tight rein on their API, to Clio, which embraces an API economy. In an API economy, a company exposes its digital services through APIs for third-party developers to create customer-focused apps.

Integration Stations

Dividing the cloud-based LPM market into two categories seems easy: 1) software that integrates with third-party applications to address customers’ business and practice needs, or 2) all-in-one software that attempts to satisfy all customers’ needs without combining with third-party software. But the truth is more nuanced, Ambrogi says.

Some LPM companies explicitly pursue third-party integrations. “The leading example is Clio, which strives to be a complete ecosystem of applications for practicing lawyers,” Ambrogi says.

Clio has an open API specification. The API, developed with Ruby on Rails, gives customers and developers secure access to data in a Clio account. Besides the open API and documentation, Clio provides a dedicated support line and hosts a public Slack channel for developers to collaborate and share data. There is also a Ruby Client library for Clio’s API on GitHub.

Newton laid out examples of using integration partners, such as Alt Legal and Brevort River Studios’ PrimaFacie software, to satisfy some user requirements. Alt Legal designs workflows for intellectual property lawyers to submit documents to the United States Patent and Trademark Office and track USPTO deadlines. PrimaFacie offers a case management system for immigration lawyers and a library of auto-filling immigration forms.

“It is fair to say Clio would never independently develop functionality that is specifically tailored to IP lawyers because that market is not large enough to impact our broader customer base,” Newton says. Moreover, when it comes to specialty areas of law, “Clio would rather partner with someone that has domain expertise,” he notes.

Photo of Andrew Gay courtesy of Clio. Art by Shutterstock.

“You could not launch a product like Clio today without a certain level of integration,” adds Andrew Gay, Clio’s manager of product partnerships. The question is not whether to integrate. “The question is how far you go, and how much control you’re willing to give up,” Gay says. “You can’t exist today without some level of integration, because lawyers like their Office 365 and Google Calendar.”

In contrast to Clio are products like MyCase and Rocket Matter that have chosen to control their API offering to customers and third parties.

“MyCase is not particularly focused on third-party integration, although the company considers integration an option,” says Nicole Black, legal technology evangelist for MyCase and a regular contributor to ABAJournal.com. The Goleta, California-based company’s software integrates with essential third-party products such as Dropbox, Google Calendar, Microsoft Outlook Calendar and QuickBooks Online. “At the end of the day, in deciding whether to integrate or build a feature, [MyCase’s] goal is to provide a cohesive, stable and secure experience for our customers,” Black says.

Like MyCase, Rocket Matter tightly controls the use of APIs to connect and share data with select technology partners. The Boca Raton, Florida-based company has more integrations than MyCase. “Where we can, we build the functions ourselves,” says Larry Port, Rocket Matter CEO. “But when it comes to a major piece of stand-alone software, if we tackle it, we will dilute our software across the board. The more you expand the offering, it’s like adopting more children—it becomes untenable over time.”

Jared Correia, founder and CEO of Red Cave Law Firm Consulting, thinks that the vast majority of LPM providers are starting to choose integrations and are setting up a platform rather than offering simple software. “But providers are at different stages of development, where they prioritize certain things,” says Correia. “Companies may want to develop an open API and integration structure, but they haven’t arrived at that point in their offerings.” Correia notes that he “can see PracticePanther providing a platform with integrations at some point.”

Like Clio, PracticePanther supports an open API, inviting customers and third-party developers to extend their product offerings. David Helberg, PracticePanther marketing manager, says that the Wilmington, Delaware-based company prides itself “on building core features natively and will selectively integrate with companies that are at the top of their industries, such as Dropbox or Box for file storage.”

LPM Features: Build, Buy or Integrate

Clio, MyCase, PracticePanther and Rocket Matter integrate with third-party software. But all the providers build features into their offerings if those elements are core to most of their customers’ law practices. Moreover, it’s safe to say that all the LPM providers we talked to listen to their customers and review market trends.

Most modern software architectures support APIs that bring together software modules to enable features. Although Rocket Matter does not open its API like Clio, the company modernized its software in 2012 with an API infrastructure to quickly respond to customer needs.

Like Clio, Rocket Matter publishes information on its API. “If a firm wants custom reports, information out of their account or to connect a back-end accounting package, they can do it,” Port says. Rocket Matter is not missing out on letting customers tie things together with an open API. The company has numerous technology partners and integrations. “We rarely miss a sale because we don’t have an integration or can’t connect to something,” he says.

According to Black, MyCase has a process to understand the roots of customer needs, see how widespread those needs are among all customers and look at the broader market. The company’s goal is to “add value for the most number of customers that we can,” Black says.

“Clio develops the core features and functionality that 80 percent of lawyers need,” Newton says. If it does not meet that threshold, Clio will probably not build it, according to Newton. Gay added that the company is clear internally about the features it includes that are core to the Clio experience. “The apps that live around the core edges of Clio are practice-specific and productivity tools,” Gay says.

PracticePanther “prioritizes natively building the software in-house,” Helberg says. The company draws the line between providing fully integrated software and third-party integrations when it believes the feature is a “must-have,” or another company is doing a lights-out job with that feature.

Each of the LPM providers offers a core package that includes secure messaging, billing and invoicing, calendar and event management, contact and matter management, document automation and management, time and expense tracking, task management, trust accounting, reporting, workflows, client intake, payments and portals, and mobile apps for Apple iOS and Google Android. Depending on the provider, core software offerings can include conflict checking and customer relations and lead management.

Ambrogi observes that the lineup of features varied little among the product offerings but emphasized that each product handles functions differently. For example, MyCase supports a mail agent in its software to receive messages into matters rather than building apps or integrations with individual mail clients such as Outlook. One of the most significant variations Ambrogi sees is an accounting program. He notes that some platforms have robust accounting, others have basic or no accounting, and others integrate with QuickBooks, Xero or other accounting software.

Port agrees with Ambrogi. “The big divide regarding integration is whether there’s a full accounting package,” Port says. Rocket Matter integrates with QuickBooks Online but is looking to expand its accounting integrations. “Once QuickBooks sunsets its desktop version, law firms are going to look at other accounting packages,” Port adds.

Law firms expect LPM software to synchronize with accounting software of some kind, or support built-in accounting software.

“That wasn’t the expectation several years ago,” Correia says. There’s also a growing expectation for LPM to provide or sync with customer relationship management software. “No one has done CRM well,” states Correia, who argues that this was one of the reasons Clio acquired law firm CRM and lead management software provider Lexicata. Meanwhile, Black points out that this is why MyCase continues to build out its lead management functionality.

Pros and Cons of LPM Integration

Customer requirements determine LPM software offerings, but providers satisfy those needs with in-house development resources or integrate with third-party developers. Whether to use in-house resources or an integration partner impacts an LPM provider’s business and software development.

Photo of Nicole Black by Antonino Barbagallo, Photo of Larry Port by Peter Lorber, Art by Shutterstock.

“LPM providers that use a third-party integration model have the potential for greater growth,” Ambrogi says. Clio emulates the Salesforce model and achieves massive growth and success by providing a core platform upon which third parties could develop custom apps. Unlike Salesforce, “practice management companies face the problem of one size does not fit all law practices,” Ambrogi adds. By providing core functionality and integrating with third-party apps such as Alt Legal and PrimaFacie, Clio’s potential market grows exponentially.

“An advantage of integration and using third-party software are the channel sales coming into your product,” Correia adds. For example, a law firm may look for LPM software that integrates with its choice of accounting or CRM packages.

“An integration model also provides a mix of ideas,” he argues. One company, one product and one set of executives become stagnant over time. “When a company has API and integration partners, it has people on the outside pushing the company in different directions, and that can be helpful in software development.”

The reason companies don’t do integrations is because they want to retain control over their systems, he adds. When third parties develop your software, they may not build it in the same way you do.

MyCase, PracticePanther and Rocket Matter agreed that building software in-house requires more time and resources than integrating with a third-party developer. “Building in-house requires the full team’s participation on the design, scope, feature set and ultimate development—integrating with a third party just requires connecting to an existing API,” Helberg says.

“Companies that choose to keep development in-house have the advantage of offering an integrated product in which all the features are natively compatible with each other,” Ambrogi says. Third-party software can sometimes be “glitchy,” he says, adding a single integrated software is more likely to have all its features work well with each other. “That significantly improves the user experience and enhances a company’s ability to provide customer support.”

Black and Port agree that integration partners could introduce complexity. “There’s a lot less complexity and more stability when integrations are used only when necessary,” Black says. Integrations can cause issues if they’re not managed well—such as security issues, inconsistent customer service and support, and different end-user experiences. “But sometimes they are the right solution for a particular customer need,” she adds.

An open API needs to be “well-thought-out and requires a meaningful initial development effort,” Newton says. Then it’s an “ongoing effort to support the API,” he adds, “requiring careful planning and attention from a product road map perspective.

“If you don’t have a platform or open API, you can do anything you want.” But the moment you publish an API and customers consume it or third parties develop it, “there are implicit promises that go along with that,” Newton states. For example, supporting an API for a given time. When a new API version is available, you need to communicate to partners with a deprecation plan for the old API and an upgrade plan for the new.

When companies such as Clio support third-party integrations, they get other people to develop their software, Correia says. That saves development costs and human capital. Integrators can also watch a company like Lexicata mature over several years and when the time is right, acquire them. That saved Clio from developing CRM software in-house and shows the advantage of the platform approach. “You can cherry-pick partners for acquisition,” he says.

Integration also impacts the pricing model, Correia says. For MyCase, PracticePanther and Rocket Matter, the more features built into the software, the less it costs the customer. With the Clio integration model, customers can add apps to complete their software requirements, but the additional subscription costs add up. That’s the “downside of integration,” he says.

You might get a lawyer or law firm that analyzes its needs and may not need document management or another feature. In which case the firm would look for LPM software that doesn’t have a DM feature to get a lower subscription cost or price point. “But few lawyers get to that granular level of discussion,” Correia says. “The average law firm uses 20 percent of the features of any given software, including LPM.”

The Dating Game

There are many ways for LPM providers to reach out to third-party developers. The simplest is organic. “Reach out to people and have people reach out to you,” Correia says. For example, all the LPM providers we talked to reached out to Google, Microsoft and QuickBooks for integrations.

Other ways to acquire technology partners include referrals from customers, direct marketing campaigns and trolling industry trade shows like ABA Techshow and Legalweek for startups. “Hackathons are also an excellent source to find people who are developing good software,” Correia notes.

Photo of David Helberg by David Puente, Art by Shutterstock

Attracting third-party developers is a matter of market share and openness. “The main thing attracting developers to Clio is scale,” Newton says. “Clio is the fastest way to build awareness and get a product in front of customers.” According to Gay, Clio has developers that launch apps on the Clio platform and in less than 24 hours report they have their first customer.

With the Lexicata acquisition, Clio put a spotlight on its App Directory. “The acquisition provides an obvious exit for Clio integration partners,” Correia says. It further encourages software developers to build products on Clio’s platform.

Clio and PracticePanther promote their open API on their websites and invite third-party technology partners to apply for access. MyCase and Rocket Matter take the initiative and reach out to third-party developers as needed. But like a dating game, not everyone who applies or gets that phone call gets access to an LPM provider’s customers. It’s a selective process.

Rocket Matter does not actively recruit people to build on its API. “Some have come, but it’s not something we actively do,” Port says.

PracticePanther “receives inbound requests from third-party integration partners on almost a daily basis due to its size and reputation in the market,” Helberg says. The company vets the requests and integrates with partners that have “compelling software solutions that solve customer needs, such as LawToolBox,” he adds. LawToolBox is a calendar integration for court deadlines that integrates with PracticePanther and Rocket Matter and works with Clio.

The Long Game

MyCase is not going to change its approach to integration, according to Black. The company’s integration responds to customer input and needs. “At the end of the day, our goal is to provide the features that our customers need to run their firm successfully,” Black says.

“Rocket Matter’s API exposes everything you could want from the system—and we consume it ourselves,” Port says. But like MyCase, Rocket Matter differs from Clio regarding integration. “Our user base is savvy, but they’re not wanting to spend their time maintaining apps,” he adds.

“PracticePanther will continue to add features and integration partners to benefit law firm customers,” Helberg says. And he’s excited for new features and integrations to come to the legal landscape, stemming from artificial intelligence, blockchain and automation.

Last year was the tipping point for Clio. “The success we’ve had in the last year is the overnight success six years in the making,” Newton says. After the 2013 launch of Clio’s API and the company’s continuing investment in its platform, Clio reached critical mass, attracting attention and increasing the number of companies looking at Clio’s platform as the single go-to-market strategy. “That’s the vision that we started with six years ago: Someone will build a stand-alone business on top of Clio,” he states.

Clio is getting traction with midsize law firms with 50 to 100-plus attorneys, according to Newton. These larger firms are adopting Clio and its API to integrate the LPM software with larger systems, such as enterprise resource planners or a legacy time and billing system.

Lawyers and law firms drive the available features in LPM, but managing third-party integrations is not for every law firm. Although Clio, MyCase, PracticePanther and Rocket Matter integrate third-party applications in their LPM offerings, only Clio offers a directory of third-party apps.

Cloud-based LPM software is a long way from an API Economy. But as Clio moves into new territory, attracting larger firms, the app software model may take hold, and other providers may follow suit.


Lexicata to grow on Clio

In October 2018, Clio purchased Lexicata, which integrated with Clio for four years before the acquisition. Lexicata acquired more than one-half of its customers through its Clio integration. According to Newton, the Lexicata acquisition was designed to deliver a suite of services that solve the end-to-end client journey from lead management to customer management. The company aims to offer the fruits of its acquisition through a new product offering called Grow. There’s little doubt that Grow will integrate with the Clio Referral Network. Referrals are a significant source of new clients for law firms.

This article appeared in the March 2019 issue of the ABA Journal with the headline "Sharing economy: Leading law practice management software providers have differing views when it comes to allowing third parties to design and customize their own integrations."

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