Episode Transcript

Chad Main:          That’s Stephen Kane. He’s the founder of a company called FairClaims. In today’s show we talk to him about ODR or Online Dispute Resolution. Instead of going to court to resolve a legal problem, ODR permits parties to resolve legal disputes online.

In our legal founder’s segment, we talked to Tucker Cottingham. He’s the co-founder and CEO of Lawyaw, the document automation and assembly tool. I’m Chad Main and this is Technically Legal, a podcast about the intersection of technology and the practice of law. In each episode we talk to a legal innovator about what they’ve been up to and hopefully get a couple of real world tips from them about implementing technology into legal practice.

Not only is Stephen the founder of FairClaims, he’s a lawyer. FairClaims is an ODR platform that permits parties to resolve legal disputes online rather than via more traditional means like heading to court. But, what is ODR exactly? 

Stephen Kane:       Use technology to more efficiently resolve disputes. Thereby making it quicker and less expensive to all stakeholders to get to resolution.

History of ODR

Chad Main:          At a very general level, there are a few main types of online dispute resolution. Some aren’t hugely different than the dispute resolution solutions we’re used to. For instance, as we will hear in this episode, both arbitrations and mediations can be conducted online through platforms like FairClaims. In those situations, rather than relying on court fines and hard copy memos, evidence and arguments are submitted electronically. However, there are also purely tech-based solutions where disputes are resolved solely by algorithm with little to no human decision-making input.

While ODR is somewhat newish, it has been around for a little bit. At least since the 1990s. When the general public really started using the internet and searching the world wide web, it was inevitable that disputes would arise. Some of the very first ODR programs were launched at colleges and universities and focused on the study of ODR, but also attempted to resolve disputes between students or domestic-related disputes. When commerce on the web took off, sites like Ebay and amazon embraced ODR for the resolution of customer complaints and disputes. That’s when online dispute resolution really took hold.

Stephen Kane:       People were talking about it 30, 40 years ago because I remember, I went to law school, I was a 2006 grad, and I read articles in law school and that’s what got me thinking about it when I was talking to my own clients about small disputes. I read articles then about people who were talking about it in the ’80s. The moment that there was the personal computer, the idea of connecting computers. Certainly the moment the internet was around, people were talking about it. It’s been decades in the making. Different companies have succeeded in different ways. It’s been attempted at least a dozen times, probably more. As far as the history goes, it’s been an idea for decades and then, I would say the first company that people would agree developed ODR would probably be Ebay, actually.

Consumers don’t necessarily think of the Ebay forums as dispute resolution but it’s very much dispute resolution. Same thing with Amazon. Amazon and Ebay were two of the first companies to really execute on dispute resolution. When you go to Amazon, you miss a package, it’s a few clicks.

Chad Main:          Expand on how Ebay and Amazon, what kinds of disputes they’re resolving and how it works because I think some people, they wouldn’t think of that as online dispute resolution.

Stephen Kane:       It totally is and yeah, because some people think, “Okay. Online dispute resolution is an alternative to litigation.” That’s totally true but, online dispute resolution also gets in front of litigation. In our world at FairClaims, we think information is dispute resolution. If you and I are debating who’s in a movie like, was Will Smith in that movie? We google it now and we resolve the dispute. When I was a teenager, we would debate it, there was no resolution. We would just debate it. We would’ve had to go to the library or happen to see it on the news because I was around when AOL first got started. That’s a form of dispute resolution and I agree that it’s not necessarily in people’s mind share, and I don’t think ODR’s in people’s mind share in general per se. But yes, with Amazon and Ebay … with Ebay, let’s say your package gets there. You buy something from a seller and it arrives damaged. If there weren’t tools on Ebay to resolve disputes, what would you do? You might hire and attorney, you might sue them. It depends on the value of the package.

But if it were a hundred-dollar package, you’d probably have to just walk away. But one of the genius things about Ebay and Amazon is you don’t have to walk away. They set it up so that you can easily resolve things and get ahead of litigation so that I would imagine, and I’m not a lawyer there, that they’ve had less litigation over the years versus other companies.

Chad Main:          For the most part, there’s no human involved in the resolution of most of those claims, correct?

Stephen Kane:       Correct. In terms of volume, there’s no human involved. They try to resolve it digitally first just with some exchange of information. However, Ebay built a huge panel of mediators way early on. I don’t know the exact year, but they had volunteer mediators so that there would be digital solutions and then, you could get a human mediator. So few people go through dispute resolution because disputes only come up half a percent of every transaction or so. Most people don’t experience it. People experience disputes but they haven’t necessarily experienced a dispute on Ebay. I think more salient, they don’t necessarily think about it as dispute resolution. That’s beautiful because if you’re not thinking about it as dispute resolution, you’re just thinking I need to solve this problem, and I think that’s what law should be.

Why Stephen Started FairClaims

Chad Main:          Like many of the people we talked to on this podcast, Stephen was a lawyer in private practice before he launched FairClaims. In his practice, he saw a pain point in the legal industry that was not adequately being addressed. But it was a probably that tech might be able to help. Specifically, the resolution of legal disputes involving parties that might not be able to afford lawyers or disputes that maybe didn’t even really need the involvement of lawyers.

Stephen Kane:       I’m sitting here at a recording studio in the arts district in downtown LA. I grew up a couple miles from here. I grew up mostly in Monterrey Park and grew up also in downtown LA. The reason that experience is relevant is I grew up not rich. I can’t say I grew up poor because I had everything I needed. But there was a six-month period for example where my mother who worked for the city government most of her career was out of work. That was very anxiety producing. Most of my family still lives like most people where they’re living paycheck to paycheck. I’m still living paycheck to paycheck. I’m totally fine and compared to most people, I’m super wealthy or rich or whatever, but I think that because of all of that and because I’ve struggled still in my adult life and I’m about to turn 40 in two weeks. 

Because of that, I still empathize with people who go through struggle who don’t have access to an attorney like 90% do not who have no idea what to do when they get into some sort of legal dispute or situation. As most of my family has no idea what to do when they’re in some sort of … not even necessarily litigation. I’m not talking about that. I see it all the time. Since I started FairClaims, and I’ve been working on it for four and a half years, it’s amazing how many phone calls I still get about disputes. People, they don’t know what to do about it and how simple it is for me with my legal background to give them two bits of information or something where they can do something about it. That’s the motivation for FairClaims and I think one of the reasons for our success is that I’ve recruited a team of people who are in a similar boat.

Not necessarily that they’re all struggling. Some of them have a good amount of money. Some of them have spouses who make money, but some of them don’t and I think that means that we’re all empathetic of what our end users go through.

Chad Main:          What was it within your practice or about your practice that gave you the aha moment and says, “You know what? There’s gotta be a better way to resolve disputes?”

Stephen Kane:       I kept getting calls from people with small claim disputes they weren’t sure what to do about. Usually it was the typical story and I would get about four or five calls a month was, “Somebody owes me $2500.” Or, “I had a work-for-hire or a contract for $3000.” Or, “A home-improvement project for a couple thousand.” Or a landlord tenant issue of $1500 security deposit and they didn’t know what to do about it. They called me because that’s what people do if they can. They call a lawyer. I offer free consultations. I think it was an effective way to get clients. I would have to explain to them and it was heartbreaking really, that, “Hey, I actually can’t help you because I’m gonna cost more than the claim is worth.” Then they would say, “Well, but then what do I do?” I’d say, “Well, you could go to small claims court.” 

Small claims court of course is a nice option. The courts are very good people with difficult roles who have a lot of volume coming their way and I would explain to them how that process worked and that they would have to look the court up, file paperwork, that I could only help them really just because I only did this part-time. I had to make money of course for my time if they paid me and that wouldn’t be worth it so that they had to go get paperwork, go submit it, serve the other side, go appear. They get their court date, it’s two to three months out. Go appear in person, make their own arguments. I could just tell they were … a lot of them were intimidated by the process. It was tough that there was that timeline when $2000 would make all the difference for their budget, whatever that was. The fact that they had to stand in from of a crowded packed courtroom and make an argument and et cetera, et cetera.

The point is that it’s a tricky situation for people when they have to navigate things on their own and just got me thinking, “Isn’t there’s something out there?” Because, at the time it was 2014. “Isn’t something out there that can help people?” I went searching, and I personally did not find something that I thought made sense for them. I don’t know what happened. Something clicked, I couldn’t stop thinking about it. I got obsessed and so I started just sending an hour a day thinking about it, working on it. I remember taking a trip to Utah where I thought, “I can make money with legal work. This is interesting to me,” and I set out to start I don’t know what. A little website, a small business. I never thought it would turn into a thing.

FairClaims’ Business Model

Chad Main:          Stephen launched FairClaims in 2014 as he phased out his law practice. For now, FairClaims mainly handles disputes under $25000 and many are related to insurance claims. However, the company continues to grow.

Stephen Kane:       We want to help people resolve any disputes under $25000 period, and we’re set up to do that now. We have a series of escalations. Our philosophy is resolve early, resolve often and avoid headache. If you go to your site, it’s be heard, resolve, move on. That’s how we think about it that in a perfect world, we all resolve disputes very quickly so there’s less stress and anxiety and worry and so that everybody gets to resolution quicker which means you can reduce your liability and get paid out and et cetera. But we can handle any monetary claim under $25000. What we do is we have a full stack that starts with information and resources. We’re giving you information about your dispute. That’s only built out for insurance claims right now.

We started working with marketplaces first. HomeAdvisor and Turo and companies like that where we mainly use arbitration and mediation. But, insurance is a great example of where we have the entire A to Z solution. A claimant comes in, first they look at literally some information about insurance claims. Some resources. It’s certainly not legal advice. It’s not specific.

Chad Main:          When you say information, you mean how the claim’s gonna proceed, what’s expected of them, what to expect in general?

Stephen Kane:       That’s basically right. Because, I think we did a lot of customer development. I’m sure a lot of us know people who have been in an auto accident. When you’re in an auto accident, no one’s sure what to do. I didn’t know anything about what to do 14 months ago. The first step is, “Hey, here’s some basics on what goes on with an auto accident claim.” That’s the first step and then, “Here’s some resources and you can go research some stuff.” Then they can go google things and we say, “Don’t take our word for it.” We are partnered with different people like the Better Business Bureau and that helps us. We have articles on our site. Good social proof, but we say basically they can look it up themselves.

That’s the first step, info and resources. Then there’s an intake module where they can kinda … we have some videos about more about how the process works. They can add information about their claim. They can add different aspects. Medical bills, property damage. Is there anything else that we need to solve for to resolve things here? Are you in pain still? When are you gonna recover? That sort of thing and it automatically walks them through a TurboTax type tool. But what we do, and this is where my co-founder John is a total product genius. Total genius. We empower them to think for themselves about what they think is fair. What that does is a couple things. One, it makes them think about it and then, it helps them consider the trade-offs of, if I want more money, is it gonna take longer? Can I cover all my bills? But more important than that, it empowers them.

I bought a hat. I went to Yale Law School a couple weeks ago to visit. I just happened to be driving from Hartford to Manhattan. I had never been on campus. It’s a beautiful campus. It looks like a bunch of castles. I bought a Yale Law School hat and our thing is we are all Yale attorneys or we could be. Because, when I do TurboTax I’m a pretty damn good accountant. That’s the idea is hey, this stuff’s actually not rocket science. A lot of it. Now, some of it is. Some of it is. If it’s a complex claim, if it’s over $25000, if it’s more than just soft tissue damage, FairClaims is not for them. Again, we don’t give legal advice but it’s more like if you give people some info and resources, if you let them walk through the elements of an insurance claim, which actually doesn’t have to be complicated, I think insurance companies have very sophisticated ways of doing things for good reasons. But, from the claimant’s perspective, it can be very simple.

What we found out in talking to them is hey, I just want a fair payment quickly. What they want is something in between. Perhaps a Google search and talking to their cousin and hiring an attorney. Now, if they go through our tool, they still have the option of hiring an attorney, and that’s fine. Some people will always want to hire an attorney but some people want a different option like a TurboTax type option. They go through and they see that, and we’re very transparent. It says, “Look, what this comes down to is who’s at fault and how much. There’s some other stuff involved, but it’s really about property damage, medical bills and then if you’re in pain there could be perhaps a pain and suffering component. We introduce some information on how they could think about guidelines. They decide for themselves what they think is fair.

I was in an auto accident two years ago. My self-esteem was low after that accident. When you’re just taken off guard and you slam into a wall, you feel a little down. We’re trying to build people back up again in this way that shows them, hey, you can do this. You’re gonna be okay. We can facilitate something to get you somewhere quickly. That’s the next step and then they go and immediately they can then decide if they want to submit it to the claims adjuster at the insurance company or not. People can literally go into our tool, get information and then go hire an attorney. They can go on our tool, get information and [inaudible 00:15:34] the attorney. They can go on our tool for fun. It’s free for consumers. But if they would like to then submit that information to the insurance company they can do that. Then, right away they’re taken into a negotiation platform where they can make offers and counter offers back and forth if they’d like. Then, they go into a mediation platform to discuss the matter with the insurance company.

Chad Main:          If the negotiation fails, then they go to mediation.

Stephen Kane:       That’s correct.

Chad Main:          I assume the negotiation’s with the claims adjuster as maybe had they hired an attorney it would be?

Stephen Kane:       Yeah, correct. Look, claimants can do this. Whether or not they have an attorney, they can do this alongside thinking about hiring an attorney. It’s a perfectly valid option either way and again, many cases where they absolutely should get an attorney but, hopefully maybe things settle in the negotiation platform and both sides are happy. If not, then they can call in a third-party neutral mediator who’s totally separate from FairClaims. It’s a 1099 and that person has insurance experience in their state, and they work it out from there.

Chad Main:          Is the mediation also facilitated on the FairClaims site?

Stephen Kane:       Yes.

Chad Main:          Okay. What happens if mediation falls through?

Stephen Kane:       In that particular flow for auto accidents, then unfortunately that means they didn’t get their resolution. We don’t recommend arbitration for most insurance claims. We think arbitration is a separate solution for separate types of problems. We do think there’s a place for arbitration with some insurance claims, like when it’s just property damage and they’re at an impasse. We have done that for other companies. We do it voluntary, not mandatory. Then, there’s a digital solution there where within two to three weeks, the arbitrator makes a decision. There’s a video hearing included.

Chad Main:          We just talked about insurance claims relating to auto accidents. Does FairClaims offer arbitration for other types of disputes?

Stephen Kane:       Absolutely. We can handle anything and with our marketplace customers, with the sharing economy customers we work with, the main solution’s arbitration. Some of them use … we call it fairchat. Our mediation tool which is like … it’s a chat tool, you can upload evidence. There’s some automated messages from FairClaims to help drive the conversation. There’s some deadlines. You can do a video call or a phone call for mediation as well. But absolutely, we can handle any arbitration under $25000.

Chad Main:          It’s basically a tool open to anybody. If you and I get into a dispute over I don’t know, we decide to start a business and it falls through. If we decide, you and I, to use FairClaims to resolve that dispute, it is open to us, right?

Stephen Kane:       Correct.

Chad Main:          It would be submitted to an arbitrator or you could do a mediation or arbitration?

Stephen Kane:       Correct. We even put the mediation tool within the arbitration platform and about 15% of our cases … I shouldn’t say cases, our arbitration matters settle with that mediation tool.

Legal Founder Segment: Tucker Cottingham of Lawyaw

Chad Main:          We’re gonna step away from our talk with Stephen for just a few minutes because now it’s time for our legal founder’s segment. Today we’re talking to Tucker Cottingham. He’s the CEO and co-founder of Lawyaw, and that’s spelled L-A-W-Y-A-W. It’s a document automation and assembly tool. Tucker, thanks for being here today. I appreciate your time. Tell us a little be about Lawyaw.

Tucker C:           Yeah, absolutely. Thanks for having me. Lawyaw is a cloud-based platform and with Lawyaw, attorneys can upload their word-based legal documents. Then, we use software to turn them into templates that can be easily and quickly filled out online. Unlike other programs that use pre-can language, Lawyaw creates templates out of the documents attorneys already have created. They use their own well-crafted words, their own documents and turn those documents into templates.

Chad Main:          It’s a cloud-based app, correct?

Tucker C:           It’s 100% cloud-based. You can use it from a Mac or PC or iPad on the go, exactly.

Chad Main:          What was the motivation or inspiration to create the app?

Tucker C:           I’m an attorney and I worked at a small law firm in San Francisco and spent a lot of time dealing with a lot of similar documents. We would use the same documents over and over again but we’d have to change bits and pieces of them and customize them to clients but, a lot of the language was gonna be the same across different projects. What we found is that it’s really unfair that attorneys who want to streamline their document drafting have to choose between really elementary tools that have a lot of limited flexibility, or these more complex programs that are really expensive and hard to use. When faced between these two options of something really simple and limited or something really complex and expensive, most firms just don’t end up doing anything. We decided to help attorneys achieve their goals by creating software that’s really powerful and also allows them to realize their benefits immediately. Occupying that middle space between the existing options right now.

Chad Main:          Let’s talk about that for a minute. The benefits. Tell us about some of the features that Lawyaw has.

Tucker C:           If you have a document on your computer, you can open up Microsoft Word. We have a add-in that allows you to easily turn that document into a dynamic template. What I mean by that is it’s not just fill in the blank. You can save alternative clauses, you can have multiple choices for different sections of the document, you can save formatted text, you can give yourself hints. You can turn your documents into these flexible templates and then, you sync it with Lawyaw and you log into Lawyaw and you can fill out the journey that you’ve created and generate that document. You can have multiple users on your account so you can manage your templates across your firm very easily. We also have a federally compliant e-sign tool so that when you actually generate the document, you can either download it back into Microsoft Word and do additional custom edits, or you can go directly to e-sign and send it out for signature. You can also upload outside documents back into Lawyaw and send them out for signature.

Chad Main:          Not only custom made Word Documents, the app also lets you fill in judicial council forms if you’re a California attorney, right?

Tucker C:           Yeah. We have about 6000 standard court forms and California’s a great example. California is super heavy on pre-printed court forms. There’s 58 counties and they all have their own forms and then there’s the judicial council that has about 2000 forms. We have a library of standard court forms. We also have all the immigration forms in addition to the ability to turn your own documents into these flexible templates.

Chad Main:          You use Word-based documents to load into it for templates, so I assume that it works with a Google Doc too if you save it in the right format?

Tucker C:           If you export your Google Doc into Word then it will definitely work. What we’ve found is the vast majority of attorneys are still using Microsoft Word and that’s where they have their existing documents. Rather than having somebody rebuild a document from scratch, you can just open a document that you already have, quickly turn it into a template and sync it with Lawyaw.

Chad Main:          Who is the target audience for Lawyaw? Is it small firms? Big firms? Middle firms? Any type of law department? Any type of lawyer?

Tucker C:           Yeah. Really we’re targeting small firms from two people all the way up to 100 attorneys. That’s the segment of the market that really doesn’t have great options right now. Those are the attorneys that are really based between a really inflexible option that’s really simple or a really complex expensive option. We’re targeting both litigation attorneys and transactional attorneys and in small firms.

Chad Main:          That brings up a point too is it really doesn’t matter what type of law you’re practicing because you probably have the same types of documents you’re doing over and over and over for your clients. 

Tucker C:           Exactly. What we’ve found is that each law firm is unique and has their own documents, but it’s a similar set of problems that they’re all facing which is that they have templates that they use, or they go to a previous client project and they make changes in that previous document. Those are all essentially templates. Attorneys that have been doing this for a long time, they know their documents really well. They know the process really well and what we’re helping them to do is to streamline that process using our cloud-based platform.

Chad Main:          To that point when you demoed it for me before we hopped on here, you showed me pleading template and a fee agreement template. You got a contract and a pleading. There’s two different types of documents. It’s really pretty amendable to any kind of document. Any kind of legal document that has variables and is consistently used, right?

Tucker C:           Yeah, exactly. Some of the commonly used documents are gonna be engagement agreements, fee agreements, discovery documents. A lot of discovery documents people are automating or streamlining. We also see a lot of motions as you mentioned. Then, on the transactional side, contracts, wills and trusts. Those type of documents as well. 

Chad Main:          That’s cool. Again, I appreciate your time today. If people want to learn more about Lawyaw, where do they find you?

Tucker C:           Yeah, absolutely. Thank you. If people want to learn more about Lawyaw, they can go to lawyaw.com/techlegal and you can also call us at 415-742-5600.

Does ODR Take Lawyers Out of the Process?

Chad Main:          Okay. Now let’s get back to our talk with Stephan Kane, the founder of FairClaims, an online dispute resolution platform. One criticism of ODR or depending on your point of view, maybe just really an observation is that at some level, online dispute resolution lessens the need for lawyers and may take the human element out of dispute resolution. However, Stephen doesn’t necessarily agree and points out that for many disputes, lawyers still may and do, and are necessary to participate in ODR.

Stephen Kane:       People are welcome to have an attorney represent them in any arbitration including with FairClaims. We’ve had plenty of attorney-represented claimants and respondents in the platform. I think that’s just up to each end user. For the end users who cannot afford an attorney or don’t want to use one, they don’t have to. For the ones who would like their attorney to handle matters, they can do that. Other people go and consult with an attorney as they’re going through the process and those are all open options.

Chad Main:          A similar critique of online dispute resolution especially as it relates to mediation, I think people might say to you, “Well, mediation is effective because it gets people in a dispute in the same room and there’s a human element, and the mediator can appeal to emotions and their reason.” But that might be absent when you’re using technology to resolve a dispute. What’s your response to that kind of critique?

Stephen Kane:       It’s not untrue and it depends on the type of dispute and the parties involved and the emotions, and we pay attention to all of that. We don’t believe that this is a solution for everything or everybody. We think it’s a different kind of option. We think there are trade-offs. It depends on somebody’s personal appetite for, do I want to get this done quicker? Do I prefer in person? We hear from some end users who say, “I don’t want to see that person.” Sometimes people want to and sometimes they don’t. Other people tell us, I don’t want to use FairClaims because I want to see the other side cringe in person and piss them off. You know what? It’s America, they have that right and it’s fine. It’s just trade-offs and what we try to do is we try to figure out what are the best solutions for certain problems? Then, optimize around that and we’re not trying to be the everything to everybody. In fact, we take a very small percentage of disputes from … with the companies we work with. 

With the marketplace companies, we’re an option of last resort. If they haven’t been able to work it out and they’re at an impasse, they either will do it where it’s voluntary or sometimes they’ve decided to include it in their provisions, but it’s up to the stakeholders involved. Our job is to be neutral, our job is to be open to everybody. Like you mentioned earlier again, anybody could use it. Other people will decide that for certain problems, they’ll decide case by case whether they use us. We’ve seen a lot of different approaches and we continually learn what’s best.

ODR is Taking Off in Europe

Chad Main:          Resolving disputes online is obviously not limited to commercial disputes, and is not always handled by private companies like Ebay, Amazon or FairClaims. Courts around the world are beginning to embrace ODR. For instance, consumers of any company in the European Union could submit disputes to the European Commission’s ODR platform. Closer to home? Courts in Los Angeles and other areas, offer certain litigants the opportunity to have disputes resolved online.

Stephen Kane:       There are several states and counties who have built a mediation platform particularly with small claims cases where they offer it as an option for people at some point in the process and it’s of course different in every place and that’s really wonderful. Look, I’m interested in people resolving disputes whether it’s through us or somebody else. I don’t care and I think it’s pretty cool. Then, yes, Europe has created some online dispute resolution standards. They have a product you can use to resolve disputes in Europe. England has done some interesting things where they’ve deregulated some legal regulation and allowed non-attorneys to invest in law firms. 

They are certainly experimenting and have been for the last couple years with providing online dispute resolution for insurance claims and by all signals, that’s going incredibly well where everybody’s better off. Because if you can just resolve things quicker, you free up more money and in the economy period. Then, if you can do it in the right way and thread the needles in the right way, which we try to do, then most, if not all stakeholders potentially could be better off depending on the decisions they make, their litigation strategy, et cetera. 

The Future of ODR

Chad Main:          As my talk with Stephen neared the end, I asked him where he thought the future of ODR was headed. He said, “One of the focuses at FairClaims is the resolution of non-monetary claims.”

Stephen Kane:       What we get most excited about are actually non-monetary disputes. The problems we’re solving now are big and especially with insurance claims. Getting money into people’s hands after an auto accident and having them feel good about themselves and about the result, that’s big, and building more trust within society. That’s really what this is about. But, we get excited about things like roommate disputes. Resolving those. I don’t think I’ve run into anyone who’s had a roommate and didn’t have some dispute, whether it’s monetary, non-monetary. I think with my roommates, like 10 years ago, one of our roommates was moving out and we had bought furniture together and the question was how much do we pay each other for the furniture? Do you diminish the value? We were geeks, okay? We were trying to figure it out and what’s fair.

It’s like, we figured it out. We figured it out amicably but we spent a lot of time on it and it was real money and it very well, very easily could have gone the other way. There’s certainly roommates who fight about rent and who’s gonna do dishes, and big and little things and that creates tension. Whenever there’s tension and stress, you’re not at your best and you’re focusing your time on things that you could be doing for yourself, for your family, for your friends that’s improving society. Roommate disputes is one example. Disputes between boyfriends and girlfriends. We as a team, early on when it was just three of us, we would go to small claims court just to ask people questions about what are you here for? We were able to do that of course all by the book. We weren’t soliciting them for our business at all. We were just gathering information. We were in the place we should have been, et cetera.

But we were like, “What are you here for?” It was interesting. There were like three people who were there, or at least two people we ran into and we visited a few times, who had a dispute against an ex-boyfriend and girlfriend about who was gonna get the dog, or who was gonna pay for something and reimbursement for a ring and stuff like that. We thought that’s really interesting because people are getting married later in life and there’s probably more of these. There was one time where I think it was through the Better Business Bureau who sends us some claims if people would like … and we’re partnered with the California chapter … where there were two or three roommate disputes in a row. What we noticed is that the conversion rate on the respondent voluntarily agreeing to sign up, because they can either have it pre-arranged in their contract or not, that it was higher than other areas.

We thought about that a lot and we said, “Well, maybe it’s because they know each other. Maybe they’re more likely to try to use something like this where they just need a little bit of a push.” We get excited about solutions on things like that.

Chad Main:          That’s very interesting and I never would have thought of that. It raises an interesting point then because I think if someone has a roommate dispute or a falling out with a significant other and they’re fighting over the dog, they might think for an instant, we could call an attorney for some advice, or I suppose they could go to small claims but that seems like a pain in the ass. I’m gonna do nothing. How do you, as the founder of FairClaims get the word out that there is a solution? There is a solution that exists that didn’t exist before and is cheaper and better and faster to resolve these kind of disputes that people may not take the time to resolve in the current day?

Stephen Kane:       We started working on dispute resolution with marketplaces, the home advisors of the world for specific reasons. That was we wanted to see a lot of disputes across a lot of different industries. They also are outstanding really early adopters who were willing to take a chance on me when it was just me with a Squarespace site. A couple of them, not most of them, who I was doing things manually because it was a problem for them. They recognized that there was value in people trusting them. They recognize that if they could resolve disputes quicker, they can enhance that trust. We started with them for that specific reason. With insurance claims, we feel like we’re solving potentially because we’re just getting started … a few months ago we rolled out our first proof of concept customer … that, that’s a big problem that we think people will talk to their friends about. We’ve already seen that happen with our marketplace disputes where we notice that once a year or so we get more in-bounds.

It’s been very slow going. It’s been four and a half years but, we think people talk about it. We think maybe folks like you are interested and then spread the word. What we focus on more than anything instead of getting the word out like with marketing, is building the very, very, very best product we can that solves big problems for people so that they might come back. Like when Starbucks just built … when they built beautiful stores and grew slowly. We’re in an industry, the startup industry that both evangelizes and worships hyper-growth. We believe there will be will a point where we hit hyper-growth, but we think the way to get there is by slowly and methodically establishing micro and macro trust with every single person who’s involved. And that at some point, enough people will talk about the result they got and look, some of them get pissed because they lost but at least people know it’s an option.

We do other things. We mainly reach out to influencers and stakeholders in law. We think the more lawyers who know about it, they can decide for themselves if it’s something they think is interesting, if they want to recommend it to a client.

Chad Main:          Yeah, I was gonna say that’s a great start is lawyers recommending to the clients because we’ve all had those calls. You talked about it earlier in the podcast. It’s a $2000-dispute. It’s not feasible for a lawyer to handle it and now they have a place they can refer their clients to. That’s a great point there.

Stephen Kane:       Absolutely. I always felt guilty when I had to turn people away. We think that over time … and I think we’re similar to Airbnb in that way. Airbnb was slow, slow, slow, slow and then at some point enough people talked about it that it became a thing. Look, we do things to reach out to groups and our investors are happy because we are selling enterprise software and I suppose services depending how you look at it to big companies now, where we can make money. We want to become the place people think about and go to when they have any kind of dispute once we gain trust in each category. Then, at some point, hit enough momentum in an inflection point so that it becomes more of a thing.

Chad Main:          That’s great and your point about Airbnb is very apropos I think because we’re talking about the change in mindset. With Airbnb it was like, “Why would I ever rent out somebody’s house or why would I rent out my house?” It’s real similar and with enough momentum it finally changed the way people look at staying overnight somewhere.

Stephen Kane:       Yeah.

Chad Main:          It could the same for what you guys are doing. It’s just a change of mindset and getting the word out that there is an alternative where one might not have existed before. 

Stephen Kane:       Absolutely.

Chad Main:          Cool, I appreciate your time, Stephen. If people want to learn more about FairClaims or get ahold of you, how can they do that?

Stephen Kane:       I’m on Twitter. Stephenlkane with a P-H. Stephenlkane. Feel free to DM me. Info@fairclaims.com. We try to be as quick as possible. Fairclaims.com and check out the site. Hit me up on LinkedIn, whatever works for you.

Chad Main:          That’s a wrap for this podcast. As always, I really appreciate you listening. I would also like to say thanks to all our listeners who submitted our name to the ABA for consideration for their Web 100. We made the list for one of the best podcasts of 2018. That’s a nice honor and we really appreciate it. If you want to subscribe, you can find us on most major podcasting platforms such as iTunes, Stitcher, Google, iHeartRADIO, et cetera, et cetera. If you like us, I’d hope you give us a favorable rating. If you want to get ahold of me, you can reach me at cmain@percipient.co. That’s C-M-A-I-N @percipent.co. Until next time, this has been Technically Legal.