Artificial intelligence has been a major disruptor to all industries, but in professional services, Debbie Weinstein said it isn’t going to replace the experts just yet.
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Artificial intelligence has been a major disruptor to all industries, but in professional services, Debbie Weinstein said it isn’t going to replace the experts just yet.
Over the course of her 40-year career in law, Weinstein has worked with all kinds of corporate clients, from public and private companies to venture capital funds and investment bankers. She’s taken a lead role in more than 200 mergers and acquisitions, including sales to companies such as Cisco, Ericsson, Microsoft and Blackberry.
Twenty-eight years ago, she co-founded LaBarge Weinstein LLP, which specializes in providing corporate finance services to startups and growing tech companies.
In a conversation with OBJ, Weinstein talks about how AI is changing the way her team works, why it won’t be able to replace lawyers anytime soon, and how local tech founders are shaking things up in traditional industries.
As a legal professional, why did you decide to specialize in startups and tech?
Entrepreneurs, especially engineers of startup and technology-based companies, are very intelligent in the products and services they want to build and they tend to be financing-oriented. In other words, they need to raise capital. They need strong professional services around them: legal, accounting and other services. We saw a need, and continue to see a need, for startups to have the same calibre of legal expertise that those financing them, those large businesses, have.
Shopify is an example. Shopify was one of our startup clients and we helped them from incorporation to IPO to make sure that, as they scaled, they had the right grounding in their legal structure, the right protection for founders and the right governance for boards and shareholders.
What’s different about the startups of today compared to when you started?
Everything seems to be moving faster, so we have had to be more efficient. All professional services companies need to be more efficient. By that I mean taking traditionally labour-intensive work — like providing early precedence for employment agreements, for incorporation, for shareholder agreements — and using technology to get to the right start point faster.
That doesn’t mean eliminating the human advice, but it means streamlining matters that, from a technology point of view, can be streamlined. For example, every company still needs what’s called a minute book when they incorporate and there’s a lot of sections to that minute book. It’s really just form-filing and much of it can now be automated with just a few strokes. We have adopted more AI-driven technology, which is assisting our clerks and our paralegals, to be less labour-intensive, faster and cheaper without losing any of the value-added services we provide. We are embracing the right technologies to help our clients while at the same time continuing to move us and provide a high level of service.
In our area, which is corporate financing, some of it can be automated but the real value-add is the nuances of the documentation. At least at this point, AI cannot replace the skill level, whether you have two years or 30 years of experience, because it’s nuanced. When you are a company negotiating with another company, if you rely merely on AI, you will lose those nuances that the other side will then take advantage of. You will not get the best deal and it will cost you dearly. AI doesn’t work when there are two parties negotiating a transaction.
Where AI works in the legal sphere is for research, form-filing and documentation. I’d call it record-keeping. When you’re a startup, you can go off the norms you find online, but you won't really have any value-added advice as to whether that’s the best you can or should do.
Startup founders need to be as cost-effective as possible. What kinds of conversations are you having with them on this topic?
We haven’t really seen pushback. For years now, even before AI became the norm, there (have been) industry standard documents to start from as a base and that continues to this day. We are not seeing less legal services or less interaction with clients because of AI, other than the day-to-day menial stuff. If they have a quick question, maybe they’re using ChatGPT to answer it. But we’re not really seeing a general decrease in services in our area of law because of AI, at least not on significant transactions.
We’re a deal-oriented firm, which includes financing, mergers and acquisitions, significant commercial agreements with suppliers, customers, licences. Not the public companies, but virtually all of our clients don’t have an in-house lawyer. Maybe one per cent do. So they’re really like, ‘Am I going to try to be my own accountant? Am I going to try to be my own lawyer?’ Our clients are using AI for coding, so there will obviously be a decrease in the entry-level (hiring). If your billings or renewals are automated, you used to have level one or level two supports. Now, a lot of that is being displaced by AI.
But we’re not seeing a lot of displacement of our services. What we’re seeing is additional deployment, by us, of technology to help those services at what I call the form level.
How are professional services companies like yours changing the way they do business with clients in response to AI?
In the early days with startups, we used to take equity instead of cash, but we moved away from that. We still defer fees for startups who don’t have money. We adopted these technologies at a cost to the firm. Unlike some law firms that are now charging for the use of the technology, the use of automation, or accounting firms who add an extra administrative fee, we’ve just chosen to continue to charge by an hourly rate and have taken into account (these changes) and inflation.
The big hidden secret about Ottawa is that we have the calibre of lawyers as law firms in downtown Toronto who are charging two to three times more per hour than what we charge. The other thing is price sensitivity, around how much a big deal will cost. Being an independent law firm, we’re not chained like some firms who only charge one way. We’re as creative as our clients want us to be.
In addition to startups, you also work with high-profile local companies like Giatec and Growcer. What have you learned about Ottawa’s current tech landscape through your work?
As someone who’s been in the industry since Corel went public, I would say that the peak of tech in Ottawa is maybe 20 years behind, as far as an industry that was just completely on fire. What happened is that other cities caught up and then passed us.
But Ottawa has always had a strong base of incredibly entrepreneurial people. When you look at Growcer and Giatec, those are two great examples of old industries: food and concrete. In Ottawa, we continue to have businesses that are generally in the high-tech industry, but more importantly we’ve got entrepreneurs who are engineers who have moved into industries to reform and really leapfrog the way business is done in those industries. They and many others are tech companies, but they’re not in the traditional semiconductor or software industry.
We also have huge opportunities in defence, housing and nuclear. I’m working with a number of clients that are very focused on the federal government’s new areas for dramatic changes to infrastructure in Canada. It’s very exciting to see a new class of entrepreneurs, many of whom are already seasoned veterans, moving into those areas. 
