Platforma.Legal partners Dmitry Maltsev and Vlad Surkov spoke to Pravo.ru editor-in-chief Boris Boltyansky about their philosophy, the benefits of project teams for clients and, ultimately, the results of their unconventional strategy.

Boris Boltyansky: Vlad, Dmitry, good afternoon. I am delighted to welcome you to what is almost a live broadcast on Pravo.ru.

Vlad Surkov: Good afternoon.

Dmitry Maltsev: Good afternoon.

Boris Boltyansky: As I understand it, you feel you have realised the dream of a new generation of lawyers and created a kind of legal Uber. Yet people in the market sometimes say that Platforma.Legal is not really a law firm. How do you define the business you have created?

Vlad Surkov: We do not quite agree with the Uber comparison. In fact, we disagree entirely. In terms of what we do, the services we provide, the clients we want to work with and the way we work with lawyers, we are very much a traditional law firm. The only thing we have in common with Uber is that we do not keep people permanently on the payroll. We will come back to that. In terms of our client base and our approach to practice, however, we are a conventional law firm.

Dmitry Maltsev: And in terms of our standards.

Vlad Surkov: Yes. That follows quite naturally from our backgrounds. We are conventional lawyers. I have been in the profession for 27 years and have spent most of my working life in traditional law firms. That shapes your mindset. We were not trying to create something fundamentally different in every respect.

But why are we different, and in what way? When we started thinking about the concept, we identified two issues. They mattered four years ago when we founded Platforma.Legal, and they mattered fifteen years ago. They still matter and will continue to do so for a long time. The first is, obviously, money. Lawyers are expensive. Clients, even wealthy clients, remain sensitive to fees. The second issue is less obvious, not only to the general public but also to clients and even to many lawyers: every individual law firm has limited human resources. A client comes to a large, reputable firm with an established brand and asks: “I have a specific issue. Who will actually do the work? How many people do you have?” After 27 years in the profession, I know that behind impressive brands there are often relatively small teams. Let us be honest: there are probably no law firms in Russia with more than a hundred lawyers, or perhaps two hundred in exceptional cases.

Dmitry Maltsev: Only a handful, yes.

Vlad Surkov: Very few. Most firms have never exceeded fifty. If you ask how many people can actually do the work in our fields, commercial real estate and corporate law, you can often count them on one hand. Clients are not always told this, and perhaps they do not always need to know.

As we thought about that problem, we realised that we wanted a model in which we could draw on more than the three, four or five lawyers sitting in the same room as us. We wanted to be able to approach, more or less, any professional in the market whom we regarded as an expert in their field.

Boris Boltyansky: Even someone working in-house rather than in private practice?

Vlad Surkov: Yes.

Dmitry Maltsev: Yes, including in-house lawyers.

Vlad Surkov: We place no restrictions on a lawyer’s background or current role. People follow different paths: some want to be employees and others do not. Two things matter to us. First, the person must already know their work and be a professional. Second, if you agree to work with us, you must see the project through properly, so that none of us looks back and wonders why we wasted our time.

Boris Boltyansky: I can see a very clear resemblance to Uber. You are evidently looking for lawyers who have long since become major business owners or retired, and who drive taxis, or take on legal projects, for fun in the evenings.

Dmitry Maltsev: Every taxi driver is a businessman. We all know that.

Boris Boltyansky: I am not entirely convinced that clients fail to see the inner workings of a law firm. A sophisticated purchaser of legal services will, I think, study rankings such as Pravo-300 quite carefully. They can see the size of the team and the number of lawyers in a practice, and work out whether the articulate partner is just selling the service or will roll up their sleeves and do the work. Or will the enormous workload fall to paralegals and junior lawyers, especially now, when the number of transactions seems to exceed the legal market’s capacity?

Nevertheless, clients must have an objection. When you describe this model, they may worry that information about their transaction, their internal documents and everything behind the deal will become available to a large number of external lawyers who may have conflicts of interest. How do you address that concern?

Dmitry Maltsev: There are several questions within that question. First, on the partner who sells the service and the paralegals who then do all the work: that situation does not arise in our model and cannot arise. We engage more experienced lawyers for each project, so we have virtually no projects where most of the work, or its core elements, is done by inexperienced lawyers or paralegals. Because we spend very little on administration, most of our expenditure goes directly into lawyers doing productive work. In relative terms, we spend more on lawyers than a conventional firm does under its model. That allows us to put more senior lawyers on a project.

Boris Boltyansky: So that is a selling point when the total project fee is the same?

Dmitry Maltsev: Among other things. It was one of the reasons we started this. From inside the market, we could see that some legal services were simply overpriced.

I remember moving into a beautiful new office on Petrovka at a law firm where we worked. It was a boom year. A very good American client came in and said: “What an office. Now I know why your bills are so high.” That was essentially true. Some clients, particularly sophisticated ones, found it irritating. When a client walks into an office that costs five times as much as their own, they know who has paid for it. We have reduced those costs to a minimum. We tell clients, truthfully, that what they spend on our projects goes into the lawyers who add value, rather than our office or expensive desks.

Boris Boltyansky: Even a very experienced and sophisticated client who suspects that a large firm allocates work throughout the hierarchy, from paralegal to partner, still believes that the brand guarantees a product of the necessary quality. What else attracts clients to your model?

Vlad Surkov: That is why I began by saying that, in the way we organise the work, we are closer to a conventional law firm. In that respect, we do not differ from a traditional firm. Our general working principles follow a similar, hierarchical model.

Dmitry Maltsev: With high standards.

Vlad Surkov: High quality standards. You also mentioned confidentiality, which we have not yet addressed. Naturally, confidentiality obligations appear both in our agreement with the client and in our agreement with every lawyer.

Dmitry Maltsev: I would add two things. First, our agreements with lawyers set out confidentiality obligations in far greater detail than we usually see in employment contracts. Second, confidentiality is one of our central requirements. If, for example, a paralegal at a conventional firm tells someone something at a party or in a bar, they may receive a reprimand. In our case, we would simply never work with that person again. That is straightforward for us: we do not need to begin an administrative process or go through a formal separation. We just do not invite them back.

Also, the lawyers we work with are experienced, and almost all have worked in private practice. They are well trained. It is a matter of professional upbringing, experience and habit.

Vlad Surkov: I would emphasise that we work only with people we trust. Because of confidentiality requirements and the need to be ready to work on a specific project immediately, the overwhelming majority of our lawyers have substantial professional experience. You will find few, if any, people who are just starting out. Beyond that, it is as Dmitry has described.

Boris Boltyansky: The consequences for them are greater in the model you offer.

Vlad Surkov: Yes, although it is not really about us punishing them. Their own professional ethics are already firmly established. Lawyers have no tangible assets: our two assets are knowledge and reputation. Without either, you are nothing. People understand how serious a breach of confidentiality would be. So, perhaps surprisingly, we are not particularly worried about this.

Boris Boltyansky: The important thing is that clients should not worry either.

Vlad Surkov: Absolutely.

Boris Boltyansky: Let me ask the most awkward, direct question. Is it ultimately cheaper for clients than going to a firm with a fully conventional model?

Dmitry Maltsev: It varies from case to case. We do not compete by aggressively undercutting fees. In fact, last year, and especially the year before, we lost on price to well-known firms, including firms in Russia’s top three or top five. All sorts of things happen. Even very large firms sometimes offer extremely low prices because they can afford to do so on certain projects. In general, however, reducing administrative costs is one of our objectives. We have tried to bring the price of legal services as close as possible to their actual value to the project and the client. So, yes.

Vlad Surkov: First, as in any business, fees are based on costs. A traditional law firm has two major cost categories which, in virtually any model, account for roughly two-thirds of expenditure: office costs and personnel. We have no office. That is a deliberate principle, rather than simply an inability to afford one. The luxurious office Dmitry mentioned, at a firm where we both worked, was very pleasant. I enjoyed sitting on a €1,500 chair. Even then, though, I understood that it was excessive. Knowing that clients understood it too sometimes made me feel uncomfortable. I said quite sincerely to colleagues and competitors: “Our clients are paying too much for this. They do not need our luxurious offices.”

As for lawyers, as Dmitry has said, we pay them well, but on a project basis. Nobody receives a fixed salary. Our payroll costs are therefore several times lower than those of a firm that keeps people permanently on staff.

Dmitry Maltsev: That was one of our original ideas. When we first met at a café in Patriarch’s Ponds, however fashionable that may sound, forgive me—

Vlad Surkov: I almost regret your mentioning Patriarch’s Ponds.

Dmitry Maltsev: Nevertheless, one of the ideas we discussed was that we wanted to pay lawyers well, so that they would feel comfortable, enjoy the projects and be just as interested and motivated in the work as we were.

Vlad Surkov: Precisely because we pay our lawyers well, our margin is relatively modest. Without revealing all our secrets, I would say it is below the standard margin at a large law firm.

Dmitry Maltsev: On price, clients have sometimes asked, when we were competing for a project: “Why is it expensive? You are cheaper on this project, but not by much. That is a large firm and you are a small one. Why is the fee at that level?” Ultimately, it is almost impossible to obtain work of this quality, from lawyers of this level, for less than we charge.

Boris Boltyansky: From what you say, it is clear that you are not threatening competitors through price dumping. To my mind, very low pricing arises when a firm has many salaried employees and is willing to fill their spare capacity at almost any price.

Dmitry Maltsev: That kind of pricing assumes that your marginal production cost is very low. You can cut the price almost to zero because doing the work costs you practically nothing extra. That is not our situation.

Boris Boltyansky: Listening to you, I get the impression that there is more behind this than an original business model. So far, I do not see what makes your life easier than simply being a partner at a large, respected firm. There seems to be a philosophy behind it. What is it?

Vlad Surkov: Thank you. There certainly is. There are several aspects. Let me begin with something important about lawyers. One of our central principles is directed at the lawyers we work with, rather than clients: law is an independent profession. We did not invent that idea. It is an established fact in many European countries, where it is formally described as a liberal profession. Lawyers may work under civil-law service agreements rather than as employees. They often forget that their chief asset is their own mind, their understanding of business in the broad sense and their knowledge of law. That knowledge belongs first and foremost to them. It is portable: it moves with the lawyer. A major firm may offer a good office and benefits, but the lawyer is at the centre of it all.

The second point follows from that. A traditional business model, in law or elsewhere, involves going to an office, following administrative rules, taking holidays at a particular time and so on. We focus on two things: quality and the ability to deliver on time to client requirements, at a standard equal to the best conventional law firms. Where you are and when you do the work is up to you. You can live in another country if you wish. Whether you also work as an employee elsewhere, or freelance on projects for several clients like us, is your decision. It is your life. We are, essentially, looking for your talent and are grateful if you choose to share it with us. That is our main philosophical point: we want lawyers to recognise that they are at the centre of their professional universe.

There is another side, though. We make very clear to those lawyers that this model carries a degree of risk. Employment is comfortable. I remember how pleasant it was, particularly with a high salary, to receive a substantial payment twice a month. You can plan precisely and worry less about not being paid. Let us be honest: sometimes you also worry less about not having much work. Any conscientious person asks whether they contribute enough to the firm and its clients to justify their salary. Even so, a fixed salary can sometimes allow you to take things easy.

Dmitry Maltsev: It is still a question of motivation.

Vlad Surkov: Of course. Our model suits lawyers who want to be a little entrepreneurial. We understand that it certainly does not suit everyone. Many people want maximum stability, and the proportion is high among lawyers. I would say well above fifty per cent. By no means everyone wants to work as one of our lawyers.

Dmitry Maltsev: Lawyers are generally conservative. Since their main field of work is risk, they tend to be cautious about everything, just in case. This requires a somewhat different mindset. Not everyone gets there, but many do, particularly given the events of recent years. Movement between firms and markets has increased, especially after the international law firms left the market. That woke many people up. We noticed how differently people began to view their place in the profession and their firm. Many now work with several law firms.

Boris Boltyansky: That raises an interesting question. Can a lawyer really be an entrepreneur? Entrepreneurship involves greater risk but also holds out a prize: building a unicorn or earning a billion dollars through entrepreneurial ability and market insight. Does the legal business actually offer that possibility today? Or, whatever we call lawyers, are they always dependent on the real economy, with a choice between a reasonably stable income from employment and, broadly speaking, part-time work?

Dmitry Maltsev: It is a good question. Unfortunately for us, a law firm is certainly not a technology start-up. In the legal market you cannot suddenly turn a hundred-rouble business into a billion-dollar company in a year. The legal function serves business and is tied to the real economy, with its own needs, capacity and limits.

In our case, the main difference from the conventional salaried model is probably that working time is used much more effectively. By spending less time, but using it more productively, a lawyer can earn more for themselves.

Vlad Surkov: Put very simply, if a freelance lawyer is prepared to work as hard as they did at the busiest times in an international firm, say sixteen hours a day, I am convinced they will earn more under our model, or a similar one, than in conventional employment. We have calculated this repeatedly. The share of the firm’s revenue allocated directly to the lawyer is several times higher in our model than in a traditional firm.

But, again, that is the lawyer’s choice. This is very important. That is why I describe the lawyer as an independent professional with value in their own right. They decide whether to work eighteen-hour days and earn more, or earn roughly the same as before, perhaps a little less, while working two days a week. Or, for example, while sitting by a lake somewhere—

Boris Boltyansky: With a significantly better work-life balance?

Continue to Part II

Watch the interview with Dmitry Maltsev and Vlad Surkov (in Russian).