Alternative Legal Service Providers (ALSP): A New Legal Era.

The legal industry, once known for its traditional and conservative practices, has undergone (and continues to undergo) a significant transformation. One of the key factors driving this change is the emergence of Alternative Legal Service Providers (ALSPs). These entities are revolutionising the way legal services are delivered, offering innovative and efficient solutions that bridge the gap between traditional law firms and hiring in-house lawyers, with some also maximising the use of LegalTech.  

What are ALSPs?

Alternative Legal Service Providers (ALSPs) are entities distinct from traditional law firms, offering legal services through innovative approaches. These providers combine legal expertise with advanced technology, remote or hybrid workforces, and specialised skill sets to deliver tailored and efficient legal support. Unlike traditional law firms, ALSPs focus on client-centric solutions and often operate on a project basis, providing services such as contract management, compliance, and legal research.

How ALSPs Are Reshaping the Industry

Over the past few decades, the legal landscape has witnessed substantial shifts due to advancements in technology, changes in client expectations, a greater emphasis on cost-effectiveness and more recently a conceptual shift with regard to the perception of remote work and independent professional services consultants. These factors have given rise to the ALSP phenomenon, disrupting traditional norms and introducing fresh perspectives and delivery models to the way legal work is undertaken. 

The ALSP Model: Key Features and Benefits of Modern Legal Support

Key Characteristics of ALSPs

1. Specialised Expertise and Agile Solutions: ALSPs are able to deploy a diverse group of professionals (Legal Consultants) with specialised legal, operational or legal project management skills, industry knowledge, and domain expertise. This enables them to offer tailored solutions that cater to specific legal challenges across various sectors and jurisdictions/regions.
    
2. Flexibility for the Legal Consultant: ALSPs provide an opportunity for experienced lawyers to control their career path, specialise in areas they want to focus on, manage the cadence of their work and place greater focus on their wellbeing. This is also a positive for the client, who will generally finding themselves engaging with a motivated, passionate lawyer who is not being micromanaged and placed under pressure to record billable hours. 
   
   
3. Cost-Effectiveness and Flexible Engagement Models: ALSPs offer cost-effective alternatives to traditional legal services. Their flexible engagement models allow clients to choose the services they need, eliminating unnecessary overhead costs associated with conventional law firms. 
   
   
4. Innovation and Technology Integration: some ALSPs also leverage LegalTech to streamline legal processes, automate repetitive tasks, and enhance the overall efficiency of legal services. This integration enables ALSPs to focus on delivering value, making the legal process more agile and responsive. 
   
   
5. Remote Capability: Many ALSPs have large global networks of Legal Consultants, allowing clients to access skill sets across time zones. And providing legal secondments with the ability to work from anywhere at any time. ALSPs focus on having the right person in the right role, rather than having an onsite resource.
   
   
6. Global Reach: Many ALSPs operate on a global scale, providing access to legal resources and expertise in multiple jurisdictions, which is particularly beneficial for multinational companies. For example, Railsbank engaged us to provide an experienced senior lawyer to serve as its first APAC regional counsel and assist in establishing its first APAC office. More project details can be found in the case study.
   
   

How ALSPs Differ from Traditional Law Firms  

Unlike traditional law firms that often rely on billable hours and extensive hierarchies, ALSPs adopt a more flexible and client-centric approach. They prioritise efficiency and innovation, providing clients with solutions that address their legal needs in a more agile and cost-effective manner. It is not uncommon for ALSPs to offer fixed price offerings. They also don’t rely on the traditional law-firm pyramid of partners bringing in the work and the more junior lawyers undertaking it. With ALSPs you get access to senior legal consultants who actually do the work, so you can be assured that you have the expertise you need, when you need it. 

ALSPs strive to offer cost models that are much more transparent than those of law firms. With most ALSPs you know the costs up front, as it is often fixed and there are no hidden costs. And perhaps most importantly for clients; without the high overheads that law firms have, in many cases clients can look forward to savings in the vicinity of 30-40% when in engaging an ALSP instead of a law firm. 

The ALSP Advantage: Benefits for Business Owners 

Business-Oriented Strategies: Tailoring Legal Solutions to Meet Business Goals

ALSPs understand that legal challenges are intricately tied to business objectives and their goal is to offer legal services in a way that makes the most sense for business. They can work collaboratively with clients to develop legal strategies that align with their long-term goals, while also enabling the internal team to concentrate on core tasks and objectives, ensuring that legal support becomes a catalyst for growth rather than a hindrance. Many also position themselves as extensions of an existing in-house legal team with aligned objectives, rather than as an external adviser. 

Flexibility and Scalability: ALSPs Accommodating Business Growth 

As businesses evolve and expand, their legal requirements and budgets also change. ALSPs are equipped to accommodate such growth by offering flexible services that can be scaled up or down based on the client's needs. This scalability ensures that legal support remains relevant and effective throughout different stages of business development. ALSPs are able to draw upon legal resources from around the globe to assist businesses with their expansion strategies with specialists located in relevant jurisdictions. They commonly help with things like international due diligence and regulatory filings. 

ALSP Use Cases: Real-Life Examples of ALSP Success Stories 

Cost-Effective Legal Solutions: How ALSPs Save Business Owners Time and Money 

Consider a fintech scale-up aiming to expand into new regions and needing to ensure it can navigate myriad regulatory landscapes in a consistent way. Engaging a traditional law firm in separate jurisdictions for such services might prove costly and may not even provide the end-to-end solution that ensures practical application and implementation across the business, taking in adjacent licensing requirements such as compliance and training. In contrast, an ALSP with a focus on this domain can offer both the legal as well as practical guidance from Legal Consultants that have that essential first-hand experience, significantly reducing costs and accelerating the process. 

CASE STUDY: an example of how engaging with KorumLegal helped Wirex continue their expansion, plans, take advantage of transparent pricing and plug-in the expertise they needed – https://www.korumlegal.com/case-studies/wirex 

The ALSP Selection Process: Choosing the Right Partner for Your Business 

Evaluating Your Legal Needs: Identifying Areas for ALSP Support 

Before embarking on the journey of selecting an ALSP, it's crucial to assess your business's legal needs and workstreams. For example, this would involve differentiating work that should go to a law firm for risk profile reasons, from the work that could be kept in-house and therefore done more efficiently by using an ALSP’s subject matter experts. Many ALSPs focus their offerings on day-to-day work, helping relieve pressure on legal teams and freeing up permanent staff to focus on more strategic priorities.   

Conducting Due Diligence: Researching and Shortlisting ALSPs 

Research plays a pivotal role in the selection process. Thoroughly investigate the ALSP's reputation, client reviews, industry experience, and technological capabilities. Shortlist ALSPs that align with your business's values, needs, and goals. 

ALSP Myths and Misconceptions

Myth 1: ALSPs Compromise on Quality

Fact: ALSPs employ experienced legal professionals, often with backgrounds from top law firms. Their specialised expertise ensures high-quality legal services.

Myth 2: ALSPs Are Less Reliable

Fact: ALSPs leverage advanced technology and rigorous processes to maintain reliability and efficiency. They offer scalable solutions with proven success in managing complex legal challenges.

Myth 3: ALSPs Are Just a Passing Trend

Fact: The growth of ALSPs reflects a significant shift towards more flexible, cost-effective legal services. Their integration of LegalTech and innovative models indicates their role in the future of legal support.

In summary, ALSPs are established as reliable, high-quality alternatives that address modern legal needs effectively.  

How ALSPs are shaping the new legal landscape 

ALSPs are fundamentally transforming the legal industry by introducing innovative, flexible, and cost-effective solutions. Their ability to integrate LegalTech and deploy highly skilled legal consultants positions them as key players in the future of legal support. As the legal sector evolves, ALSPs are likely to continue leading with advancements in technology and client-centric models, effectively addressing challenges related to workload management and resource allocation.

The rise of ALSPs reflects a broader trend towards efficiency and accessibility in legal services. By providing tailored support and leveraging global networks of legal consultants, ALSPs are shaping a more dynamic and responsive legal landscape.

In conclusion, ALSPs are not just a passing trend but a pivotal element in the ongoing evolution of legal services, driving greater efficiency and effectiveness in addressing complex legal needs.

Read more about the growth of Legal Consulting as a profession here:  https://www.korumlegal.com/blog/the-evolving-landscape-of-legal-consultants-and-the-rise-of-alternative-legal-service-providers