Raad Raad ⚔

A Conversation with Bryan Pham for the Asian Hustle Network podcast
‍
Bryan: At what point did you realize that you had product market fit and how did you
advertise this product?
‍
Raad: It started out with my co founder and I knocking door to door with a square
reader and going on Yelp. We started charging people $300 to join the platform and
promising them clients, even though we had no ideahow we would get any. Then, we
realized that actually getting lawyers to pay for your services is a harder problem
to solve for.
‍
So it started off as this SaaS subscription model and we allowed lawyers to upload
their real time availability. It was similar to a Zocdoc for lawyers where people with
clients can go in, click a slot, get a consultation, get the lead and they would pay us
in exchange for that. That wasn't really good at product market fit, It wasn't
sustainable. We were going after so many different practice areas from divorce
lawyers, to personal injury lawyers and we were spread too thin. Eventually we
focused around startups and small businesses.
‍
We thought that we had product market fit at that time, but it really wasn't. Yet, it was
enough for us to get the attention of 500 startups because we were growing. We were
doing a few thousand dollars in revenue a month and it was picking up.
‍
In terms of social network and how we marketed, I utilized Quora which is a Q&A
site to filter by all the legal questions that people were asking. I cracked open my
old law school textbooks and began answering hundreds and thousands of them for
free and I would link Lawtrades at the bottom for people to check it out. It resulted
in a lot of people visiting the website. I would answer questions like should I
incorporate as an LLC or a C Corp? I must have answered that in 50 different ways
on the site, but it eventually drove some traffic back to the main homepage.
‍
What's cool about Quora is it also picks up with SEO. So if its a really
popular question, people can type it on Google and then Quora will usually be the
first answer there. So not only do you get Quora's traffic, you get Google SEO traffic
as well. That jump started a lot of our early growth and a lot of our early users.
‍
Bryan: I know that you initially mentioned that you thought you had a product market
fit, but what was a real Pivot that caused the product market fit?
‍
Raad: It's tricky because you can grow your company, get paying customers and just
assume that you have product market fit. Fundamentally, if your underlying unit
economics is not sustainable and your customers aren't constantly coming back to the
platformusing it more and more, it becomes really hard and expensive to grow your
product. You can be sort of tricked into thinking that you have product market fit,
which is what happened to us.
‍
We were selling to startups and small businesses and eventually got into 500 startups,
which invested around 125K at the time. Then, we eventually raised a seed round
shortly after doing demo, which resulted in raising a little over 3 million dollars. It
was led by a big VC fund, Draper Associates. At that point, we switched away from
just posting on Quora because it wasn't scalable to continue running more ads on Google and Adwords.
‍
At a certain point, we were spending close to 100 grand a month on Google Ads.
We were acquiring lots of customers and focused on growing the top line revenue in
the business, even though we were actually losing a good amount of money.
The problem with the early stage startup small business segmen, is the vast majority of
them go out of business within the first year.
‍
If you think about when you're starting a company, the last thing you want to spend a
lot of money on frequently is a lawyer. You're trying to hire for engineering, you're
trying to market and spend money on a customer acquisition. When you're building a
marketplace start up, if your demand side usage isn't predictable and rec

Kamrul: Raad, I'm just curious. Why did you get fired from CVS?
Raad: There was one night where someone asked me to vacuum the aisle, and I think I was the youngest worker there and I just didn't want to vacuum it. It was supposed to be an every other day thing. And they were like, you have to. I was like, no, I'd rather just do anything else.
They fired me the next day. They found some excuse. They were just like, oh, your cash register was short by 36 cents. I knew it was because I pushed back on doing something I genuinely didn't want to do. It was a common theme in my life where I just didn't like being told what to do.
I'm a little bit of a free thinker and maybe that seeded the plants of not ever being able to hold a steady job since then, which leads into a bigger story.
Kamrul: But you've never held a job?
Raad: I have, but they were very short-lived. I wasn't very good at showing up at one place at a specific time and doing the same thing over and over again. I'm just not a very big morning person. Whenever I had to forcefully wake up, that would just dampen in my mood right then.
I'm a curious person. So if I'm told to do something and I don't really understand the why behind it, I'm just not going to be naturally into it. I'm going to do it by force. I think I did that with a lot of my other jobs because I needed the money. But I knew it wasn't going to be long lasting because I'd rather be poor than do something that I'm not generally interested in.
Before CVS I worked at Jones beach concession stand, I worked at a country club as a food server. Then I worked at a couple of law firms and luckily those were pretty short because they were while I was in law school, they were two or three months long. It was just enough to realize this has to end at some point. I needed to look at the writing on the wall. I just got into making stuff on the internet.
Kamrul: Obviously you have this company and you manage people. How would you deal with someone like you? Someone that's a free thinker and maybe takes direction, but doesn't want to do exactly what they're told?
Raad: I try to actively find those people. I'm not the best manager. The people that we hire and bring on have to be self-starters, and just be generally curious. I'm good with setting the stage and setting the vision and letting them know why this work is important and the impact they could have on the greater society. After that, it's really just up to them on how they perform. Money is a decent motivator, but if you're building anything early stage, you really need people to go away beyond just money being the main motivator. It needs to be something that comes from the heart.
And that's the only way you're really going to succeed. When you're doing something really early stage, especially in the technology sector, and within law. There's been institutions around for hundreds of years, and you're this less than 10 year-old startup trying to disrupt it.
You need people to go to the extreme. Extreme actions lead to extreme results. I try to actively find those people. It's very hard for us to hire because there's not too many of them out there.


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit raad.substack.com

EJ: Does this create any network effects, as you sell into lawyers? Obviously if they want to, they can go start their own practice and use Lawtrades. Do you see that happening?
Raad: That's an interesting question. We've actually had people in both ways. We have had people on the supply side get hired by a company and become the GC there who then use Lawtrades to hire another team of remote freelancers. There's definitely network effects from a traditional platform perspective.
The more talent and supply side you have, the faster matches the better experience and all of that. Even on the customer side it's a very referral driven industry. You're not going to be able to sell to general counsels via a LinkedIn ad or a cold email.
That helps for little bit of brand awareness, but it really is word of mouth driven. So for us, getting a couple of customers and making them really happy and exceeding all of their expectations in terms of price, in terms of quality, in terms of product experience, and really blowing them away led to a lot of our growth because they went around and told all their friends- and their friends told their friends.
That's why a lot of our focus is on community building through virtual events and in-person events. Not only is it fun to hang out with your customers and grab a drink with them, but it adds more fuel to the fire in terms of spreading via word of mouth.
The same thing happens on the talent side. If somebody gets on the platform and they get hired and land an amazing gig- they tell their friends about it. LinkedIn is our main platform.
So we see people posting about us from a talent perspective-
This was amazing. It was life changing. And so much better than the traditional staffing model or so much better than working at a Big Law firm.
People take note of that and then apply themselves. They'll often share different opportunities with their friends if it wasn't a fit for them. I think for these very vertical marketplaces, it really is important to provide an amazing experience for both sides because they're the ones that are going to drive most of your growth.
It's not a SEO play. It's not an ad-words play. It really is just brick after brick- building community, gaining trust, and then giving them the tools to go out there and spread the word.


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit raad.substack.com

At the end of 2019, Lawtrades’s bank balance was down to $20k.
People were getting value from our platform, but we were struggling to convert that value into a healthy balance sheet. Investors were wary of our niche after Atrium shut down, so we had little choice but to go into survival mode—cutting 80% of our staff, and even, at one point, putting expenses on personal credit cards.
Most companies in our position would have gone knocking on VCs’ doors, looking for capital to bridge the gap to profitability.
But we felt we could preserve our equity, stay resourceful, and elbow-grease our way across the chasm.
First, we pivoted, shifting focus from small-to-midsize businesses (SMBs) to hypergrowth tech startups. That brought its own slew of challenges, and a brush with bankruptcy that we narrowly avoided. But ultimately, we managed to hack our revenue, taking it from $70k/mo to $700k/mo. 
Here’s how we did it, step by step, and the lessons we learned along the way.
Step 1: Fired 94% of our customers
In the beginning, Lawtrades tried to serve every type of client. Mostly, this meant SMBs who couldn’t afford full-time legal teams. Unfortunately, it also meant:
* High churn. SMBs generally needed one-off legal help, meaning limited repeat business.
* High customer acquisition cost. The less repeat business we generated, the more prospects we had to nurture, hiking our customer acquisition cost.
* High competition. Without a clearly defined niche, we were competing on more fronts than we could afford. 
Taking a cue from Peter Thiel, we realized that competition was for losers, and that the only way forward was through our most profitable customer segment: hypergrowth tech companies, often pre-IPO, whose general counsels (GCs) needed ongoing support. We fired everyone who didn’t fit that niche, and quickly became a go-to tool for companies like Cruise and DoorDash.
Lesson #1: Riches are in niches. 
Step 2: Built a community
Having identified our niche, we naturally started learning a lot about it. What problems did GCs commonly face? How did they solve them? What trends were impacting the space, and how could legal teams stay ahead of them?
To collect our insights, we created a Substack newsletter, Forward GC. Over time, this led to:
* Loyal customers. Customers learned to think of us not just as a marketplace platform, but as thought leaders in the niche. 
* More referrals. By solving one problem very well on a repeatable basis, we earned endorsements from prominent brands like DoorDash.
* Lower customer acquisition cost. Word-of-mouth marketing is highly cost-effective—especially when it brings in repeat customers.
Lesson #2: As Paul Graham said, “It’s better to make a few users love you than a lot ambivalent.”
Step 3: Realized we had a cashflow problem
The one great thing about serving SMBs was that they paid quickly. Our newer, larger customers often worked on 30-, 60-, even 90-day billing cycles. Given that we pay our lawyers every two weeks—Lawtrades is fundamentally about economic empowerment on the supply side—that meant our outflow outpaced our income.
The more hypergrowth customers we attracted, the more we grew—and the faster we lost cash. This is where we got down to $20k, where my co-founder and I paused our salaries, and we where had to go into survival mode.
Lesson #3: Don’t grow broke. It’s not always within your control, but avoid it if you possibly can.
Step 4: Tried everything to improve our cashflow
Desperate times called for desperate measures:
* Working with shady lenders, some of whom wanted customers to pay them directly—both inconvenient and suspicious.
* Quick business loans with outrageous interest rates, in some cases, as much as 10-20%—near-impossible to justify.
* Putting expenses on personal credit cards, specifically mine, which prompted some (very) angry words with Amex.
Each of these steps bought us some time, but never sustainably. We couldn’t keep borrowin

EJ: I can think of how I might approach this. If I were in that position, I might try to go out and get large clients first then see if I could subcontract that work to some lawyers I knew. How did you approach validating this idea. Was was most important to validate: that lawyers would want to be entrepreneurial, or that clients would use a service like this?
Raad: Because it's a marketplace, you're validating both of those needs. When you look at it from the side of an independent lawyer joining the platform, you want to validate if they can actually leverage this for a source of income. Are there real dollars that can be passed from this platform?
There's been plenty of companies before that just did lead gen that would charge lawyers a subscription and sell them contact forms, then they would pay per contact and take it offline. I didn't want to build that kind of business. That's been done by the late ‘90s, early ‘00s directory websites.
We started off in a pretty manual way. We used Square readers as a way to pass money back and forth before we built out a more automated payment platform.
On the supply side, will they earn enough to stay on the platform? The demand side was the harder one. We pivoted through it a couple of times. We originally started selling to everyday people with all sorts of legal needs. Then we narrowed it down to small businesses and early-stage tech companies.
Now we've found product market fit with scaling pre-IPO tech companies with an in-house legal team. For that, it was validating if they would use something like Lawtrades instead of a traditional BigLaw firm that’s been around for a 100+ years where they have deep connections and relationships. Will they actually try out something new?
That's been a little bit of an uphill battle, but after Covid- most companies were forced to cut their legal budgets in half and hire remote workers. The pandemic actually helped accelerate our growth because it forced companies into considering us as a viable option. Since then, the growth has been snowballing.


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit raad.substack.com

EJ: It sounds like you're creating a category. There are people who start their own law practices, but it seems like something people do later on after they have a few decades of experience. You're building awareness for lawyers that this is something they can do and then helping to create social proof and education about how to do that. Then a community to support?
Raad: That's pretty spot on. It is a different category. It's building into this internet economy around delivering services online. It's around building your online profile reputation versus your offline, in-person reputation.
I think we're doing a good job of signing up lawyers that never really considered this a real possibility. People look at us and question how big the market is for lawyers that are actually freelancers. We have no idea how many lawyers in full-time jobs right now are looking at us and considering that to be a real possibility.
If anything, after COVID, it taught a lot of professionals that just because you have a full-time salary doesn't mean you're guaranteed a job. You can get fired at any point in any time and everything can be gone. Post pandemic, it’s viewed as a more riskier bet trying than diversifying, or trying to build out a book of customers.
It’s less risky than someone saying-
I'm going to not just be with one company for 10 years. I'm going to work with five or six companies at once. I'm going to build up my reputation so that can speak for itself. And I'll get hired in the future instead of just working under one brand and one law firm.
By doing more than one practice area, you can diversify your skillset and be more marketable. We already know the future is going to be moving everything to digital, and to the internet.
We hear about all this stuff happening with web3 and the metaverse, and that's all great- but who's innovating around work? What does that look like in a web3 world? We're already changing that as it is. When you join Lawtrades and your profile is approved, you can get hired within the same day. We've seen people get hired within minutes.
That's a very different process than going on LinkedIn and browsing through jobs and submitting your resume and waiting around for days, and talking with a recruiter- or going through a couple of rounds of interviews. It's really old school. Vertical marketplaces bring hiring into the future. It creates opportunities for independent professionals, way faster, in a way more predictable way.
Now payments are seamless. Now there's a dashboard. Now there's spend predictability. They're not wasting time sifting through resumes and posting jobs and going through recruiters, it's a direct connection. It'll be interesting to see that grow and play out. It's a peek into the future of work.
I know everyone throws around the word, future of work, but we're actually doing it.


This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit raad.substack.com