When Incident IQ announced a new equity partner earlier this year, it fell to the company’s one-person legal team to generate reports on the company’s contracts to help support deal due diligence.
It’s the kind of task that can be time-consuming and labor-intensive, but since all of the data was in the company’s contract management system, the reports could be generated instantly.
“It would have been a nightmare to try to support the due diligence without the legal tech we had,” Donato Latrofa, Incident IQ general counsel, said in a webcast hosted by Tim Parilla, chief legal officer at legal software company LinkSquares. “When the data pulls came, it was like, ‘Oh, my god. If I had to go and search this—’. But now it’s ‘Bam. You want these? Here they are. Want more? Here, keep coming back; there’s plenty of food here in the buffet.’”
Latrofa says it’s his legal tools that have enabled him to remain the company’s only lawyer even as it’s grown to 170 employees serving a client base of some 1,600 school districts. The school districts use the company’s software to help K-12 schools manage their workflows.
“I’ve been lucky enough to have the tools I’ve been given, or otherwise sought out, to help increase my capacity,” he said. “I don’t think we need anybody in the near term.”
That could change once the company reaches 250-300 employees and grows its customer base to 2,000 school districts, Latrofa says.
“I can see the need for an attorney in probably two years,” he said, “but if things get more complex, that could flex, either forward or backwards.”
Nor does he see the need for a legal operations person in the near term. “I could probably get by without one for quite a while,” he said.
Value-added service
Latrofa credited the contract management system with helping the company improve the cadence of its business by making it possible for the sales team to work on deals that would otherwise have to wait because of school district budget restraints.
As a general matter, school districts are limited to spending only money budgeted for each fiscal year, with no carryover. That creates a lull in the summer as districts, out of money from the previous year, wait until the new year begins, in July, before they can start spending again.
“We’d have sales folks twiddling their thumbs for 15, 30, 60 days,” he said. “Nothing they could do.”
When July 1 came around, there would be an avalanche of work. “We would finally be able to pull everything and they would send us purchase orders,” he said.
To smooth out the sales cycle, the company uses the contract management system to keep the back-and-forth on the sales contracts going during the lull so when the new fiscal year money is budgeted, the deal is ready to close.
“Instead of waiting for the purchase order to be the contracting vehicle, we already have the contract done,” he said. “The purchase order is just a formality for purposes of booking the revenue. So, it helps smooth out the workflow and keep people engaged and employed.”
