The Pioneer of Credit Card Payment Processing for the Legal Industry: How LawPay is Transforming the Way Lawyers Get Paid and Practice Law, with Founder and CEO Amy Porter
Welcome to the Unbundled Attorney Mastermind Podcast. Below is the transcription of this episode from our Unbundled Attorney Mastermind Podcast. You can watch the episode on our Youtube channel or you can listen to the episode by clicking here.
Dave Aarons: Hello and welcome to the Unbundled Attorney Mastermind Podcast. My name is Dave Aarons and I’m the founder and CEO of Unbundled Attorney. In this podcast, we interview our unbundled attorneys as well as the leading experts in the industry to identify the best practices for converting leads into paying clients and how to ethically and profitably deliver unbundled legal services and other affordable options in your practice. To learn more about how exclusive unbundled leads can help you grow your practice, visit our website at unbundledattorney.com.
Dave Aarons: All right. Welcome to the Unbundled Attorney Mastermind Podcast. It is my pleasure, finally, that I get to sit next to Amy Porter, who’s the founder and CEO of LawPay. And the word LawPay and the concept that LawPay has brought to the industry as far as making merchant processing seamless and streamlined, and available so that clients … Actually, the attorneys can enroll clients, can easily make it easier than ever for them to pay you for your services, has been something that’s been mentioned on the podcast and many, many, many times pretty much every episode.
So, it just seemed like it makes sense to have you come on and share the background on the story, and how this came about, and maybe your ideas on the future of virtual process in the legal industry. So, really appreciate you taking the time to join us and looking forward to unpacking the genesis story of LawPay.
Amy Porter: Well, thank you. Happy to be here and thank you for having me on the show.
Dave Aarons: Cool. Maybe just a good place to start, we haven’t had a chance to hang until just now, which is … I’ve always had a great relationship with John, co-founder and … but so it’s nice for me to also to be able to get to know you a little better and hear a little bit about your background, and how LawPay, which seems like is used by everyone nowadays, came to be, because years ago it wasn’t necessarily self-evident that lawyers needed to use credit cards or accept credit cards in their practice. I know that hasn’t always been just like accepted for a while, it was probably an uphill climb to educate attorneys about why it’s important. And so, maybe we can talk about some of those challenges. But why don’t you take us back to the beginning on how this initial concept started, and your background obviously in payments and how the inspiration came to bring this to lawyers.
Amy Porter: Sure. No, absolutely. And my background, I’m not a lawyer as we just discussed, but my background is in payments, even coming right out of school. So, almost 30 years now I’ve been working with Visa/MasterCard, working working in the payment industry. 2005, 2006, started working with law firms, lawyers, really with the bar associations trying to … And just asking questions, how do law firms except payments? And it was interesting at the time, there really wasn’t a solution for law firms to accept credit cards, which seemed crazy. There was solutions for restaurants and dry cleaners, and every other retail application you can think of, but not for professional services. And there certainly was a need. Lawyers needed to get paid just like everybody else.
But at the time in 2005, and it’s funny, this is over 10 years ago, there was a perception that accepting a credit card in a law firm was extremely unprofessional. And when I originally would talk to the executive directors at the bar or different bar presidents, they would say, “Our members or our law firms would never accept a credit card. That’s just unprofessional. They wouldn’t ever do it.” So, it was interesting. So, of course that was certainly a challenge to me. Well, why is that? So, I started digging into the industry. Why? Why wouldn’t a lawyer, why wouldn’t a law firm wanna get paid faster, easier? All of those payment things that were transforming other industries, and there were two things really.
One was, there wasn’t a good process, there wasn’t a good system that went into their workflow. There was a point of sale, there were credit card machines, none of that worked for law firms. So, that was a challenge, how do we build a platform? How do we create a system that works for law firms? And so that was the Aha moment is you know what? There isn’t anything, so I’m gonna build it, let’s figure it out. Let’s build a technology that actually works and is designed for law firms. So, that was number one.
The second thing that I heard was it’s not ethical. There’s issues with IOTA accounts staying in compliance, meeting ABA rules for professional conduct on handling trust, account payments, things of that nature, being able to separate earned and unearned fees. So that was issue number two.
Dave Aarons: And that was a real concern, obviously.
Amy Porter: And that was huge and that was huge. And up until that point in 2005, even at the state level, the state opinions, the ethics opinions either discouraged or even thought out prohibited law firms from accepting IOTA payments on a credit card, because they ran the risk of commingling funds. So, that was the biggest challenge that we had to face until we were able to build a back end. So now that we built technology that was designed for a law firm, the second part was building the back end so that it was able to protect and guarantee money going into an IOTA or a trust account. So, what that does is-
Dave Aarons: Yeah, to be able to delineate where it goes.
Amy Porter: That’s right. That’s right. So a payment comes into a law firm, if it’s for advanced fees to if it’s for a retainer, it’s unearned, that fee goes directly into the law firm trust IOTA account, if it’s a past due balance, a fixed fee work, some of the things that unbundled attorneys do, that’s gonna go straight into their operating account because the attorneys earned that money. So it separates those fees. It also protects that IOTA account, so that Visa/MasterCard or any of the third party banks can’t have access to it. And so we guarantee him in block that IOTA account historically with credit cards.
It’s interesting when a traditional, let’s say a restaurant wants to take a credit card and you come in, you pay for your meal, it goes into their main operating account for the restaurant. If you someone steals your credit card and they decide they wanna charge it back, this is always a big issue with lawyers, a Visa/MasterCard-
Dave Aarons: Or probably one of their objectionable like hey, I don’t want to deal with a chargeback when I’ve provided services.
Amy Porter: That’s right. It’s a huge concern. And so normally in a chargeback situation, Visa/MasterCard can just come back in to whatever account the money went into and take it back out. So you can imagine the issue with an IOTA account where you don’t allow third parties to come into that IOTA account. By taking your credit card, you’re inadvertently giving Visa/MasterCard access to that trust account. So we had to prevent that and stop that. So we had to build a back end bank partnership. We had to build a backend agreement, basically a merchant processing agreement that specifically protected the IOTA and the trust account.
And so, once we were able to build that, get that in place and then we went back to the bars, went back to their ethics committees, went back to the practice management staff, that’s when LawPay really started to become the norm for legal payments.
Dave Aarons: We said that, like glossed over. Like once we accomplish that, no problem.
Amy Porter: Yeah. No big deal.
Dave Aarons: No big deal. Can you give a little bit of context to how challenging it was to approach the Visa/MasterCard credit card industry and say, “No, you can’t take these funds right back or the charge back. Here’s why.”
Amy Porter: Sure.
Dave Aarons: And I also would like to just rewind the clock a little bit on how you got started in payments, a little bit of your background. So cause like you’ve obviously been doing this 30 years now. Right? And so how did you get your original start? How did you get to know this industry? Because the things that you’ve been able to accomplish is not some ordinary joe could make this happen.
Amy Porter: You know what? I cut my teeth in the industry the hard way, like a lot of people. I came in right out of school and it was a credit card payment sales rep for a bank down in San Antonio, Texas. And it was a sales job. So I was working with smaller businesses, mom-and-pop businesses to accept credit cards for the first time, which was a lot of fun. Back then we used to do the, what they call the old knuckle busters. And so they’d take the slips into the bank and turn them in, and they’d get a deposit to their account. What was interesting, I guess kind of my background there and just I guess more of an entrepreneurial’s just that spirit. I’m always thinking that way.
I was working with a bank called … it was a Texas Commerce Bank at the time that they’d been bought several times over now. And I don’t think they exist, but I would take a small startup business to Texas Commerce Bank and the underwriters of the bank would say, “Oh, that they’re too high risk. They’re a new business, we can’t or they’re too small, we can’t let them take credit cards.” So this just shows you how far it’s changed, you’ve got PayPal and Square- . So this is-
Dave Aarons: So this is mid ‘90s?
Amy Porter: Mid ‘90s, early ‘90s. Yeah. And you used to have to get approved and go through this extensive underwriting process to accept credit cards. And so clearly times have changed, but they wanted to see two years financials on a business, they wanted to see … you had to go do a site survey and we physically go look at the business and ensure that they existed. And the issue was, and there’s still the underlying issue of fraud today. And the issue was, you’re giving someone the ability to move money literally overnight. So, the banks were terrified at the risk and the liability on this. So, you fast forward, I guess to answer your question, I was working with these smaller businesses in San Antonio and they weren’t able to get approved.
Dave Aarons: Were you working from an office or did you go out and knocking on business doors?
Amy Porter: I was knocking on doors, knocking on doors.
Dave Aarons: Nice.
Amy Porter: Like Santa Claus, I had a sack of a knuckle busters and credit card machines, and going out [crosstalk 00:09:57] and talking to people. That’s right. That’s right. “I can save you a penny.” That kind of thing. Awful, awful. I hated it
Dave Aarons: Did you get a residual commission?
Amy Porter: Yes, it was awful. Just trying to get out of school trying to figure it out, but-
Dave Aarons: Good for you.
Amy Porter: I really became very interested in the dynamics in the back end and the process of a credit card transaction, of how the payment network worked, the different players, the different banks, the issuing banks and acquiring banks. And it’s actually super interesting in industry, and started digging behind the scenes a little bit, and I didn’t wanna just be a sales rep, I wanted to do more. I wanted to add more value. I wanted to actually provide a solution. I didn’t wanna run around asking people what your rate was and that can save you a penny.
Dave Aarons: Well, was that rooted in some of the conversations you would have with business owners, some of their frustrations-?
Amy Porter: Absolutely, absolutely. They trying to find a solution and there wasn’t a one-size-fits-all solution for every type of business.
Dave Aarons: I’ve forgotten your business needed two years of tax receipts, and you have a new mom-and-pop shop that’s trying to open up. So it must have been really challenging-
Amy Porter: They’ve got to take credit cards. It’s this huge hurdle they had to overcome. So that led me to start looking for other solutions, other partners, other people that were willing to take the risk and liability on these types of businesses. And so, that certainly that started to expand my horizons. And then you fast forward to law firms and again, they’re not selling a product, they’re not selling something that they can return. And so initially the banks even thought lawyers were high risk, so you can imagine because they’re not selling anything that they can take back.
Dave Aarons: There’s no potential product. There’s no return. Right.
Amy Porter: That’s right. And then on the flip side were concerned about liability with charge backs and things like that. And so fast forward, how it worked out is we essentially as LawPay took the risk and liability on these initial transactions to cover for the bank and to protect the law firm. And so we really bridged that gap.
Dave Aarons: Oh, I see. So you went to Visa/MasterCard and said, “Look, you can take this money out but you can take it from us.”
Amy Porter: Correct.
Dave Aarons: “And then you’ll get it from us and then we’ll basically-”
Amy Porter: So we essentially took on the risk and liability for our law firm clients, and we still do that to this day.
Dave Aarons: Wow. Okay.
Amy Porter: That’s a big part of what we do and this year we’ll do over $5 billion in legal payments, so we’ve come a long way.
Dave Aarons: Yeah.
Amy Porter: Which is fun.
Dave Aarons: Take us back to the early days. It was one firm at a time.
Amy Porter: Yeah, one firm at a time-
Dave Aarons: It was a picture of like how you got your start like, “Okay, we see this.” Obviously you had … Maybe you could take us through just initially before you could even launch the product until you had that arrangement made with Visa/MasterCard and could make that a possibility, and then you had to figure out the technology to make the funds actually flow into an IOTA versus this and build it the back end. So who were your initial people you organized? How did you start to put this thing together?
Amy Porter: Right, and the reality is, it was some law firms here in town in Austin that I knew people that I had known through different work situations, just lawyers that I knew as friends that were willing to try this out. And it’s funny and initially they thought, “Oh, I may have one client wanna pay by credit card.” And then I talked to him now 12, 13 years later and all of their clients pay by credit card, and it’s super simple and easy, and they can’t imagine otherwise. So it’s been a fun transition. It’s been fun to watch the pendulum swing from “This is so unprofessional. We’re never gonna use it,” to, we absolutely want a simple, efficient, streamlined experience for our clients. Of course we want them to be able to pay with a click, just like any other experience they have with any other payments versus getting a paper check in the mail and it goes to the bottom of the pile for frankly, a lot of clients now, they don’t check their mail and they- [crosstalk 00:14:14].
Dave Aarons: They don’t have a printer.
Amy Porter: And they don’t have a printer and they don’t have a checkbook either. So, you’ve got some things working against you now. But going back, building out the platform and the technology itself, and then going and approaching the different bar associations, and walking them through how this could work. And in some of the more progressive bars, really saw the potential, they saw that they were looking … This was an opportunity to bring value to their membership. And frankly, we started with some of the smaller bars first, a lot of the local bars, some of the bigger metro.
So you, of course in Texas, the Austin Bar, The Dallas Bar, the Houston Bar, all the way through San Diego, L.A. County. Those were bars that they voluntary bars, you know, their job was and they felt their duty was to bring new technology and value to their members to help them run a better practice. And so this was that right in with, I guess their thesis and what they were hoping to accomplish for their members.
So working through the bars we felt it was important to have, from a credibility standpoint, because lawyers historically were opposed to taking credit cards or to doing anything online, certainly using the cloud, lack of technology, lack of security, all of those things. And so by working through the bars, it gave us that credibility, it was vetted through the bars, show-
Dave Aarons: They essentially had to give a bit of a blessing, right? I mean, were attorneys still accepting credit cards but it was like gray area, like does it have to go with or what-
Amy Porter: Some of them more. They would … This again, were probably into the 2000s at this point and if they did take credit cards, it was on a credit card machine they would have sitting at the front desk in their office, very old, not the right solution. So they did take credit cards they were using a point of sale, a checkout process, which in the legal world isn’t the right fit, isn’t the right solution. Some of them, even early adopters who were lawyers who were more technical, would open a PayPal account, which great, definitely a step in the right direction, but it still didn’t quite work. So PayPal is not gonna separate their earned and unearned fees, they’re gonna take the processing fee out of the deposit. So you’re only getting a partial deposit, which makes accounting very difficult. And also, if it’s an unearned fee, you certainly can’t have PayPal taking some of your clients’ money to accept the transaction. So there was a lot of logistics that a traditional payment style merchant account didn’t solve. And that’s where LawPay really came in and solved the problem.
Dave Aarons: So and then let’s talk a little bit about the platform. Did you have some friends who were developers? Did you figure out like how … you’re coming from the payments industry, let’s say you didn’t have the Dev part of it and that’s an important part of platform?
Amy Porter: It was, it was and that was a really part of the critical turning point for us, was I guess making the investment going out on a limb and a hiring that initial dev team. And that, frankly, that was a lot of fun to work with them and put a product roadmap together. I hadn’t done that before. Being in Austin, Texas, with tons of technology here, so had some really smart, great people.
Dave Aarons: So it was 2004, 2005?
Amy Porter: Yes. And so bringing them in and I’m in building out a product from scratch. We weren’t selling-
Dave Aarons: You didn’t even have a roadmap, yeah.
Amy Porter: Yeah. We didn’t even have a roadmap. Our roadmap was based on what the law firms wanted and what they told us they needed versus a lot of technology companies will go build a product and then go find somebody to buy it. We did it the exact opposite. We had clients wanting to use the system that we’re using credit card machines that needed a better way. And so, getting that feedback and building something that actually worked in the legal industry, that worked for a law firm, that worked inside their workflow versus the other way around. Being able to plug into the way that they do business as a law firm. And it was a lot of fun to build that technology. I don’t know your question, what was your question again?
Dave Aarons: We were just talking about the development.
Amy Porter: Oh, we were talking about the development. I get excited about that because that was really a catalyst for the company. It was really a cool thing.
Dave Aarons: This is just technology that underpins LawPay as far as obviously distributing the IOTA accounts versus what? That was revolutionary, obviously.
Amy Porter: Yes.
Dave Aarons: But then also just the capacity for to have an interface in which they can send a link, get paid, a place where they can bring someone to their own page and the client can initiate the payment themselves, and like take it so that the client empowers the client to be able to complete that transaction on their own. And the implications of that as far as nowadays and the way that attorneys are transacting with clients a lot of times over the phone or running virtual practices, and just all the different new ways and alternative fee arrangements that attorneys are using, that platform, that capacity to have that interface turned out to be critical. And I think is a huge differentiating factor is that attorneys have that interface to work with. So, that seems to me like one of the biggest pieces that makes everything you do possible.
Amy Porter: No, I mean, you describe LawPay better than anybody I know, so that’s perfect. If the whole unbundled thing doesn’t work out, you get a job. But it will because I know you guys are doing great. But for us, the goal from day one was, one, to make it simple, to make it easy. Technology just has a tendency to get so complicated. And this didn’t need to be complicated. And really the underlying mission of all of it was to transform the way law firms get paid. And so, everything we did and everything we built was with that end goal in mind.
And so, every feature, every product, and we’re still developing it. We still add new features. We still continue to make that process easier to integrate with different practice management systems too. We enhanced security, we continue to build out those features based on feedback from law firms using it and they’re using it in a lot of different ways. As you mentioned, some law firms only do it … only accept payment in the office, which is great. They can log in and do that.
Some law firms send out an electronic link, a secure link to their clients and they want their clients to enter the credit card information. Great, they can do it or it’s. Or it’s a mix. Some people, some law firms have it on their website, pay invoice, super simple. Which is we talk a lot about making it easy for the law firms, the firms that add a pay link on their website get paid so much faster because they’re driving clients to their website, so then they can provide other information. They can tell them about a new partner that they have or new practice area, or a new service they’re providing. And so it’s really a business tool. Why not?
Dave Aarons: It’s fostering that relationship.
Amy Porter: That’s right. That’s right. Why not drive your clients to your website and just it’s an expectation, it’s a habit. You’re guiding them there. They should go see your website because that’s how you can communicate with them and give them additional information on your firm. And then, oh, go, “Yeah, get paid too.” So it’s all very circular and a lot of times you send a client to your website, they pay a bill, guess what? If you’re asking for a referral, great place to do that. If you just want a case, great place to talk about that. If you added a new service to your listings, great. So it’s good for business to get paid actually.
Dave Aarons: Yeah, that’s right. And if you make it any harder than it has to be for clients to enroll on your services, you’re running into [inaudible 00:21:58].
Amy Porter: And that’s what I still find now when I talk to law firms, in a lot of times and they don’t realize they’re making it extremely difficult for clients to pay them.
Dave Aarons: Well yeah, I think they look at, “Oh, there’s a percentage of … and this is a big payment I’m receiving, so if I have to pay 1% to 3% of that, man, that’s a big cost, right?” But they fail to take into consideration the number of clients that may not enroll for their services at all just because there’s that extra level of friction. And I can speak to that in a sense like we’re lead generation experts and so every step in the process that you have to take the clients through, you’re gonna have a little bit of attrition, a little bit of drop-off right?
Amy Porter: That’s right.
Dave Aarons: Every step, even just a question on a form, right? And so at every step of the process, there’s going to be a drop with each added layer of friction. And so there’s a loss in clients that I think a lot of attorneys don’t necessarily take into consideration when they’re really looking at their overall, right? They focus on what they’re losing and not necessarily what they can possibly gain.
Amy Porter: And it’s been proven, law firms that accept online payments get paid 39% to 40% faster. So right there, that makes a lot of sense. But the reality is we all know the closer to the time you finish the work … the closer you get paid to the time you finished the work, the happier your clients are, the better experience they have. As time goes on, they start to think, “That law firm wasn’t so good. My attorney didn’t do that good a job really.” And then 90 days out and like, “I didn’t even him to do that work. I didn’t even need her to fill out that contract. I could have done it myself.” And so, you start to lose the value of your work or the perception of the value of your work.
So time is not on your side getting paid and having a better experience for your clients. So, you know the minute you finish the work and they’re happy with your services, and they’re thrilled, they’re both one, they’re most likely to refer you to somebody else in that window. They’re also more likely to pay you, so why not embrace those two things? They really go hand in hand.
Dave Aarons: Right. And you’ve done an amazing job of integrating what it is that you offer and the tools that you offered to attorneys into their existing practice management tools, into all the tool that they use on a day to day basis. Can you talk about the relationships that you forged with [inaudible 00:24:32]. Step one was let’s get the bar associations, understanding what is we do, how it’s different, how it protects the attorneys, why it’s necessary. Here’s the platform, so they can start to give you the credibility and help to promote, and educate the attorneys about this being the wave of the future obviously, and also the how it is that you’re doing it in a way that’s ethical, so they’re feeling protected.
Amy Porter: Correct.
Dave Aarons: Then the secondary level would be obviously reaching out to other technology based company, so that your system integrates seamlessly with what they were going to be already using. So, can you talk about how those relationships began to evolve those initial conversations with Jack over Clio and obviously eventually fortunate to Clio payments and I think you’re going to have integrations with most [inaudible 00:25:18] Software’s that are out there. So [inaudible 00:25:21].
Amy Porter: And you said it exactly right to kind of … And again, I don’t know that I had a crystal ball and thought of this ahead of time, but the reality was, we really had chapter one or phase one and that was exactly what you said. It was getting credibility, getting recommendations from bar associations from the legal community that this was okay. It was okay to take credit cards. It could be done if it was done correctly. So that was huge for us. Then the [crosstalk 00:25:51]
Dave Aarons: It got issues, because that’s the same hurdle we’ve been working to overcome with unbundling, is like, “It’s okay to unbundle. [crosstalk 00:25:58]
Amy Porter: To do something different.
Dave Aarons: All right. One got the ethics committee on board, then it’s like, “Okay. Now that we know it’s okay, how do we actually implement it in our practice on a day to day basis, right?”
Amy Porter: Exactly.
Dave Aarons: Phase two
Amy Porter: And so phase two was; now where do we plug in? How do we come into a law firm in plug into their current workflow without changing everything? That wasn’t necessarily really. In a lot of it, the easiest way to come in was through different practice management systems and the reality is those were law firms that we’re looking for technology, they’re looking, they’re already looking for easier solutions, they’re looking to be more efficient and have a better client experience. And so plugging into those systems was really a natural next step for us. And the reality is we have a lot of LawPay clients who we are truly their first step into technology. We’re an easy first step, because they don’t have to change anything in the way that they run their practice, except at the very end they can send out a secure link and get paid.
And I’ve had lawyers tell me, that’s like magic that’s so easy, they can’t believe it. And it’s funny, they resist for years and then they finally take a payment on it, and they can’t believe like, they’ve been holding out for [crosstalk 00:27:09], that was easy. But what have I been thinking?
Dave Aarons: It really takes some of the pressure of awkwardness, sounds like, “Oh can you write me this check now, here the cash, it’s just like, and “I will send you a link. We’re done.” It makes that little bump, so much less uncomfortable.
Amy Porter: It’s no big deal and it’s frankly, it’s how people expect to pay for things now. So, it makes a lot of sense. And so, but by also working with the different practice management folks out there even early on, in 10 years ago clinically or just is that a good example? They just had their 10 year anniversary.
Dave Aarons: Yeah, they did.
Amy Porter: And so Jack [CEO of Clio] and I early on started running the same race a little bit, and that was, how do we work with law firms to use technology. And so, it was always very natural for our companies to partner, and our products to partner.
Dave Aarons: So, pretty early on like this was-?
Amy Porter: That was pretty early on, even as kind of referring business back and forth. That was early on I guess it’s probably been five years now. They, they built our technology into the Clio platform. It used to be people would use Clio and people would use LawPay, and they worked very well together, but having them fully integrated took things to it, to the next level for sure. And so they call it Clio payments, but Jack and I joke back and forth and it’s like, I can’t believe you don’t want to call it LawPay, and so we settled on Clio payments.
Dave Aarons: Was it like Clio LawPay? [crosstalk 00:28:37].
Amy Porter: I’m like you’re not gonna call it LawPay. I’m so upset and Jack and I said, “I don’t care what you call it. I just want lawyers to get paid, right?” I want them to use the technology.
Dave Aarons: Is it powered by LawPay.
Amy Porter: That’s right. It is powered by LawPay. But what’s funny, when Clio first launched it, we would get a few phone calls saying, “Oh, I need to cancel my LawPay account. I’m going to go with Clio payments.” “You’re good, I promise.” So walking people through that, so that we had a little bit of an identity crisis the first few months that it launched, but really the value is bringing LawPay technology into any workflow that little law firm uses. Even if it’s an outlook or Gmail, you could paste and put a LawPay link into those systems, and that’s what lawyers are using every day.
So, couldn’t be easier. We give them links to put on their website and really anybody can do that. They don’t need a developer; they don’t need them an IT person to use LawPay. Literally if they can send an email, you can use LawPay. It is that easy. And that was the goal in mind from … initially was-
Dave Aarons: To make it like seamlessly integrated into their day to day workflows?
Amy Porter: That’s right.
Dave Aarons: And practice managing is something that a lot more attorneys are using nowadays. That’s getting into the point where it’s very self-evident. I think that like if especially lawyers are coming out of law school, that grew up with a smartphone in their hands and you recognize that there’s … and that’s not just the attorneys but also the consumers are mobile enabled technology enabled and they wanna just be able to click and he thinks quickly. Right? So, that’s getting to a point where like, “Hey, you need tools that can make things electronic and streamline. And also when it comes to be able to provide value added services, you need an interface that can deliver your document services and track all your tasks.” All that kind of thing.
So, that’s becoming self-evident, but also … so there’s the integration with practice management, but then also you’re talking about ways in which even if you don’t use practice management software, it’s something that can just integrate into your do you send emails, how do you send a retainer fee? Okay, now you can click a button, right? So it just makes it-
Amy Porter: Easy first step.
Dave Aarons: easy for the attorney and then easier for the client, and that … especially when you’re advertising or building a business, the easier you can make it, the more money you’re going to collect. Right?
Amy Porter: Right. And it didn’t seem super simple. And we still have law firms resisting and pushing back to the concept of getting paid online. It’s still purchase orders, it’s still there. They’re mailing out invoices, paper statements. They may even write if they do accept credit cards or they decide to accept credit cards, they may write it at the bottom of an invoice, but they don’t create a way to actually do it, so they don’t create that one click experience.
And then that’s really what it comes down to. Make it simple. Let somebody do it in their hand, let them, let somebody do it from their phone, let them click a button and pay, that’s the end goal. It’s really an Amazon style checkout. In that if you go buy something online or you go to Amazon, they don’t say, send a check to Seattle, you’re not going to do that. Right? And so, we’ve had people … I tell that story and we joke all the time and people will say, “Oh, can you really do that?” Like, “No, you can’t do that. You have to pay. That’s your only choice.”
And so that’s the expectation people are slowly getting trained. It’s been really fun to watch, the transition of legal payments. We feel like we created it 13 years ago now or however long in to watch this transition and watch the adoption over time. Even law firms that were early adopters actually process more of their billings on LawPay now than they did 10 years ago. So, it is becoming entrenched in the way that they manage and run their business and they’re becoming more efficient. They’re adopting other technologies that work with LawPay. And so that’s helping drive their practice. It’s really just an interesting thing to thing to see and we’re continuing to work to drive that change.
Dave Aarons: Yeah, absolutely. And especially nowadays, this is one the things we talked about on our podcasts, attorneys come on all the time. But the ways in which they’re using some of the unique features of LawPay such as automatic payments, automatic recurring billing, and how that’s shifted the confidence level that attorneys have, that if they put together, for example, a payment plan or offer a payment plan to a client that they can time it such that the it will, it will be aligned with the client’s normal schedule they’re getting paid such that they can say, “Okay, well if you get paid every other Friday, what can you fit in your, into your budget?” “Okay. Every Friday when you get paid, it will be a $200 payment or $300 payment.”
And to know that that first of all, they don’t have to run it manually, they don’t have to call the client for each payment because you can imagine in the past if you were to do a payment plan and every single time they had to send a check or they had to … Even if you could … if you work certain payments over the phone, you still had to call the client every time. It’s too much administrative time. It makes sense that attorneys wouldn’t offer payment plan just given the administrative aspect. Whereas if you can obviously make it hands off, where you put it in one time, you scheduled a payment plan and then that just runs automatically on that payment schedule.
And then secondly, because it’s timed in accordance with when people are getting paid and then you can schedule that in accordingly, those payments are going to be processed successfully a lot more often. And so they, they can have confidence in being able to offer those options without some of the fears or as much of the concern that they’re gonna get burned or get … or that’s gonna be too much time and all that. So, it’s been really amazing to see the adoption rate and the way in which attorneys are literally shifting the way they practice law and offer more affordable service options. The unbundling, of course, I mean that’s something we talked about on the podcast all the time because they have the tools that make that possible.
Amy Porter: And in scheduled payments can be used in a powerful way to your point because it allows access to, it allows other people access to your services as a, as a lawyer. It’s certainly in unbundled world that could be the difference between someone being able to hire a lawyer or not. [crosstalk 00:35:09] So, it’s really a game changer in the way that someone could manage their business. And so that feature in the technology that was built around scheduled payments, that’s what it was designed. It was designed to have a custom payment plan, lawyers can set up any dollar amount-
Dave Aarons: Yeah, once a week, every other Friday.
Amy Porter: They can do daily, weekly, monthly. They set a schedule, they control the cadence and the frequency of when a payment is made, up into a certain amount, it could turn off automatically, so that it really gives them control which is powerful, and so the technology built around that couldn’t be easier, the security. Everything that was built around that is, again, to make it easy.
Dave Aarons: Yeah. And enable attorneys to have the competence to start offering these options. Have you seen some other … or we can talk just about just innovative ways that attorneys are being able to work with clients now that they have these tools. We’ve heard a lot of attorneys offering more virtual services, virtual estate planning, these types of things because and working from home … working from co-working spaces and so forth, and having kind of a laptop … Location dependent practice [inaudible 00:36:22].
Amy Porter: For a virtual attorney or someone working on the road, or working at the courthouse. It allows you to accept payment and finished your job or finished the work without being in your office. I’ve heard stories of lawyers that for their entire career would spend Sunday nights up at the office, putting together their billings and invoices at the end of the month or at the end of the week. This changes all of that. Takes that, gives them that time back, which is nice, but it allows things did be set up automatically. It allows them to be set up. I’m not even just a scheduled payment.
Scheduled payment doesn’t even have to. And this is what’s interesting and I’ve seen lot of law firms do. It doesn’t mean that it has to be a recurring payment. It could be that you schedule all of these payments to hit up to pay on the first of the month. So you could go in at any point throughout the month and put in [crosstalk 00:37:14] a payment, be scheduled at a certain time. So, you can schedule a single payment and you can arrange them all to be scheduled, and then guess what, 100% of your bills are paid on the first of the month. That’s amazing. What a concept.
And then you move on with your work. So the reality is lawyers and we see this, and we have based on our stats. Law firms that use scheduled payments, or even or scheduled payment plans even, or the combination, they collect 20% more than lawyers who don’t. And so, and we see that just in our own world. It’s pretty powerful. It’s a powerful tool, and there’s a lot of creative ways you can do it, the mobile LawPay APP. Again, the goal is to be simple, the goal is to keep it easy. I’m sending links out to clients, so you’re not even … you shouldn’t or you don’t have to ever see or touch credit card information. That’s not your job as a lawyer, right?
Dave Aarons: Yeah. And that’s protective too in that way.
Amy Porter: You’re not the checkout guy. Send the link out; let your clients pay on their time when they’re ready, if they wanna pay you in the middle of the night, great. They wanna pay at a … on a Sunday afternoon, great. Let them do it on their time in their hand.
Dave Aarons: Yeah. I think that’s one of the most exciting aspects of LawPay and just, it’s why I think 97% of our attorneys probably used the platform right now. Is an alignment with access to justice as far as, enabling attorneys to work with clients in ways that they otherwise couldn’t in the past. Or was too cost prohibitive or was too administratively challenging, or was too expensive. Or whatever it might be, it gives them the ability to offer, like we talked about the podcasts, all different kinds of flat rates, unbundled services. They can get paid as a retainer fee and do payment plans. They can do it as one flat rate upfront or they can do payments over time, right? If it’s a flat rate, one of the things that our attorneys are offering now is this layaway, right?
So, if you have a client, let’s say they need to get … they’re going to be providing an unbundled service, that’s going to be a $1000, right as a flat rate, to draft all the documents and then have time to advise a client on how to file it, how to get prepared for court if they’re going to be providing them, a limited scope assistance. They can do that flat rate. If the client says, “Look, I don’t have a thousand dollars, what that attorney would normally do is, they would just probably turn that client away and said, “Okay, great. Well, once you have that, or once you have the 2000 or the 3000 give us a call.”
But nowadays, what they can say is, “Okay, well what can you, what can you put towards it. Why don’t you go ahead and put $200 down? Can you afford $100 a week? $400 every two weeks, whatever it might be.” And then the clients to start making those payments automatically, and I think a lot of clients really appreciate having this kind of structure, because those that are of limited means don’t tend to be as good necessarily at managing their finances. So, if you can give a client a structure that where they know every week, even if it’s just $100 or $200, whatever it might be, that they’re moving forward towards their goal, right?
They’re not filing the documents until that balance is paid, but you’re enabling the attorney to offer solutions that they otherwise in the past just couldn’t do it. You know, you could say … Well, you could do layaway for the past like, “Send me a check every week.” Clients aren’t really going to do that. But if they can put a card or debit card, or something like that and say, “Okay, once you have the $4,000 will go in and file it, and then they can just gradually make those payments, and enable that person to get to where they need to go in a way that maybe they couldn’t do on their own.
Amy Porter: Right. When I saying what we’ve done on the LawPay side, is we do what’s called tokenization, so we allow an attorney to. They don’t store credit card information, but they can store token that accesses … We call the LawPay vault, so that token accesses, has access to our bolt so the attorney can charge the card in our vault, but without seeing the credit card information. So, from a security standpoint, they can do those things. They can be flexible in how they choose to charge clients.
Dave Aarons: Yeah, that’s HIPAA compliant, right? Because they’re not having to like, “Okay, go ahead and give that card from me over the phone.” and then write it down on a piece of paper.
Amy Porter: We don’t want that, although lawyers still do that and I have walked in into a lot of law firms where the credit cards are literally on post-it notes sitting on the front desk. Please don’t do that I beg you.
Dave Aarons: Don’t do that! No posted notes credit card numbers.
Amy Porter: That should be a marketing campaign. LawPay’s the anti-posted note credit card. But they do it and that’s … Or I’ve seen client files with a credit card information and posted inside the client file in the files floating around the office, things like that. Which you don’t want to believe that people do things like that, but it happens every day. So, use the vault to use LawPay from a security standpoint. Again, another value add to that just makes it even easier.
Dave Aarons: Yeah. And a more accessible for folks. So, this has been a really helpful and nice window into how this all came together. Maybe as a kind of a final step, if you can give us an idea of what you guys are working on right now. I know that probably there’s some cool secret sauce you guys have in the works, but more so … I mean obviously you’ve been a visionary from the very beginning. You’ve been an innovator, you’ve obviously saw a need to serve small business owners and attorneys in this industry from the very beginning and that obviously is a huge component of why you do what you do. And I appreciate that as far as the impact you’re having on the way attorneys are practicing law, it’s definitely integral part of what all of our attorneys doing and I’m one of the attorney.
And so, is there anything that you can share as far as what you see the way things are evolving in the future and some of the goals that you have as a company to bring that future to fruition as quickly as possible?
Amy Porter: Sure. We’ve got a couple of goals. One, obviously we want to continue to educate and drive change in the legal industry. We’ve got about 40,000 law firms that use LawPay, but there’s a lot that I still have never heard of us … Still resistant to one technology in general and in change. So, kind of use using technology to help them, and so, we still have a lot of work to do in that regard to … there’s this thing called the cloud that we want lawyers to use and it’s a big change. It’s a big change for a lot of them and we get that. So how do we continue to drive education and in drive adoption.
Dave Aarons: Where is that cloud again? It’s up there somewhere [gestures to the sky].
Amy Porter: That’s right. And it is secure and it is a good thing for your business. So, we’ve got a lot of work to do there. And then the other side is … that’s the adoption side, but really then the second part is the utilization. How do we help law firms, even though they’ve adopted online payments, continuing to make them more efficient? Next month we’re rolling out our new ACH product, which very excited about. Which again saves money from credit card fees and allows them, gives them another opportunity to get paid, and so that’s exciting.
So it’s kind of eCheck and it will still work with all of the features. So it still works on a secure payment page, still works on a secure link, will still work on payment plans and secure than scheduled payments. It just gives the client … Again, building out that client experience. So now when they click to pay, they can pay by credit card or eCheck.
Dave Aarons: But I don’t have a credit card. Can I still enroll?
Amy Porter: Absolutely. You can pay on eCheck. So, that’s fun.
Dave Aarons: That’s an objection lawyers get all the time.
Amy Porter: Absolutely. So that’s huge. And I think that will help and play right into some of the issues they’re having with … especially with unbundled being able to have access to financing and things like that. So, that’s another option the clients can pay.
Dave Aarons: That’s wonderful.
Amy Porter: So, we’re super excited about that.
Dave Aarons: Even if they just have a bank account, that’s don’t need a credit card, don’t even need a debit card, so that you can process that bank draft, that’s going to be really powerful.
Amy Porter: It will be powerful. So we’re excited till next month. We’ve been working on it, truly for almost two years now. [crosstalk 00:45:43] we building in a full backend to do eCheck because we didn’t want to do it through a third party. We didn’t want to roll it out, just white labeling someone else’s product. I’m kind of core to the LawPay technology. It had to be our technology, had to build into our system completely. We didn’t want it to be a bolt on. We didn’t want it to be just something extra. It had to be part of the workflow, part of the process, so very excited about that.
Dave Aarons: Well, yeah, and I’m sure that probably took a lot more time, a lot more investment of energy to do it right, to be made part of your platform. And I really get that. That’s something that you guys are really committed to, is keeping it something that you can protect the information because you’re not going to a third party. You know, it’s integrated part of the platform that they’re already used to and using every day. So, it’s just a seamless integration to make things easier for attorneys. So, I appreciate the fact that you’re committed to making sure that something that you guys built from end to end, because that’s not always easy to do.
Amy Porter: That’s not always. And even to the fact that we’re 40 developers here in the Austin office, we don’t outsource, we don’t send anything out … all have our developers, all the work on LawPay is done here in this office, and that’s been from day one.
Dave Aarons: All right. So with that we’ll wrap up. Thanks again for all of you that are listening. This has been obviously a great opportunity to get to know Amy and everything they’re doing over at LawPay. For those of you that don’t have it yet, make sure you check them out. We have a linked … anyway, we can put it in the show notes, a link to LawPay, we have a little demo on the automated billing payment option that enables it, makes it a lot easier for you to offer payment plans and then make that something that you can have confidence in. And that obviously just going to make a lot easier and more affordable for clients to access your services and should help you grow your business. And of course all the tools that they’re implementing and to make it easier, faster for you to accept payments, it’s just really exciting.
We couldn’t be more thankful that LawPay exists to make it easier for you to run your business. So, thanks again for implementing all these service options and ways in which you’re working with the clients into your practice. And of course we’ll look forward to seeing you on the next episode.
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Episode 56: The Pioneer of Credit Card Payment Processing for the Legal Industry: How LawPay is Transforming the Way Lawyers Get Paid and Practice Law, with Founder and CEO Amy Porter
It’s easy to forget that when LawPay started in the mid-2000s, few lawyers were accepting credit cards, and for good reason. At that time there wasn’t any way to route credit card funds directly into a lawyer's trust account, which created serious ethical issues. There was also no simple, easy to use platform where lawyers could receive credit card payments online and clients could pay for their services with the click of a button. LawPay changed all of that, and nowadays it’s hard to find a law firm that doesn’t accept credit cards. Today, Founder and CEO Amy Porter joins our show to share the LawPay success story and how LawPay got started. Amy will update us on groundbreaking changes they have pioneered over the past decade that expands the way lawyers accept client payments. We also discuss how the LawPay platform has helped usher in a new era of virtual and digital lawyering, and has enabled lawyers to offer more creative and flexible payment options to make their services more accessible and affordable.
To read a complete transcript of this interview, click here
In this episode, you’ll learn:
- Amy’s background in the payment industry and how the idea for LawPay began
- Why lawyers, and the legal industry in general, were at first resistant to accepting payments via credit cards
- How LawPay was able to overcome ethical concerns by enabling attorneys to route credit card payments into an IOLTA account protected from chargebacks
- How LawPay forged relationships with local bar associations to build credibility and trust in their payment platform and acquire new clients
- The technology that underpins the LawPay platform, and how Amy attracted a development team that built a simple, easy to use payment interface between attorneys and clients
- The importance of making it as easy as possible for clients to enroll in your services and eliminate unnecessary points of friction
- The value of adding a pay link to your website, and sending electronic payment links via email
- How a client’s perception of the value of the services your firm provides changes over time, and why getting paid immediately after services are performed is so important
- How their relationship with Jack Newton, CEO of Clio, was formed, along with other practice management companies, and how it has impacts the way payment processing integrates into a lawyer’s day to day operations
- The value of the “one-click” payment experience and how it improves client conversion
- How the automated payments feature of LawPay has influenced more lawyers to offer payment plans, which has helped to improve the affordability of their legal services
- A breakdown of different types of creative and flexible payment options that LawPay enables attorneys to offer, and the impact this has on access to justice
- An exciting announcement about an innovative new feature LawPay has released that significantly improves the way lawyers accept payments
- And much more…
Resources Mentioned in This Episode
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