Katie Richards On Legal Tips To Help Your Social Enterprise Thrive

Katie Richards is a lawyer who will stop at nothing to address the access to justice issue, so that every Australian can access legal help when they need it, no matter where they live or their financial position.

Katie’s background as a legal advisor in both Australia and internationally in many diverse cultures, has helped her find ways to be respectful of individual communication needs whilst finding a way to democratise legal services. As one of Australia’s most awarded entrepreneurs, Katie’s passion for helping those in need has been well received.

Her self-service legal platform Law On Earth was incubated inside her first startup Virtual Legal, an online law firm, to keep costs to a minimum while testing how legal tasks could be automated safely. Law On Earth is the only telelaw platform in the world that allows the public to manage their own legal needs and save up to 90% cost whilst providing professional indemnity insurance and also much higher transparency and security for users.

Katie discusses key considerations for social enterprises to avoid legal action and steps that can be implemented to mitigate risk.

Highlights from the interview (listen to the podcast for full details)

[Tom Allen] - Katie, to kick things off, could you please share a bit about your background and what led to your passion in social enterprise, law and helping vulnerable Australians?

[Katie Richards] - I actually grew up in North Queensland in a tiny country town. My folks were divorced when I was just one year old, so I grew up in a family that didn't have any resources. I guess [because of this] I understand what it's like to be one of those people that just can't afford to do a lot of things.

You have to be resourceful in the way that you manage your life, but Law is one of the areas that I found is quite difficult to be resourceful in. That's sort of what I wanted to do, is make sure that when I grew up, I could do something that would make an impactful change for people.

Law was probably the field that I needed to go into, keeping in mind there are no lawyers in my family, they're all nurses and electricians.

You've come from that background, grew up in regional Australia and you've gone on now then to found Law On Earth and Virtual Legal. I must say it was an absolute pleasure to collaborate with you this year as part of our Elevate+ Accelerator Katie, and just see how dedicated you are to these platforms. I'm keen to hear what is your purpose and what work are you typically undertaking as part of these platforms?

I'm one of those crazy people that believes that I was actually put on the planet specifically to do something, and I do believe that what I'm doing now is my purpose. The way that I see it is I want to make sure that while I'm alive on this planet I bring fairness for the community, and my skill set is legal. The vehicle to address the access to justice issue then is obviously using my legal skills.

Keep in mind that 75% of Australia can't access basic legal help, it's a massive problem, and where we need to start with all of that is around good education and basically addressing the day-to-day life issues.

Tom, one of the biggest things is when you have a situation where people feel like they don't deserve legal help, then it actually creates anxiety. It's not just the fact that they can't get advice, it's the fact that people say, "well, I don't deserve advice because I'm not wealthy." We have enough things to stress about in life, and we found a way that we can bring Medicare to everyone for the health element, but we had to find a way that we could bring legal help to people because it's a complicated world now. Really my day to day work is a little bit like a box of chocolates (as Forrest Gump would say), but I could be doing anything from pitching to government, writing grants or having strategy sessions with my software team.

I could be drafting legal documents, talking to a social enterprise or a charity around some problems that they're having and finding a way that we as a team, not just me as a lawyer but also the software, customer service and user experience managers can all find a really good way to help people the most.

[This is] so that they feel like they've been recognised as very worthwhile human beings that deserve help. We can get legal to them as quickly and efficiently as possible.

Well done on growing and scaling your team so much over the last 12 months Katie, it's been great to see your platform really rising. In providing this legal support then to a range of different businesses and social enterprises, how have you seen them react to COVID-19? It's a very unique environment, so what support do you believe that impact and purpose led social enterprises really critically need right now and moving into the future?

Tom, leasing has been a really big issue. A lot of these businesses have shopfronts and a lot of people have not understood what happens with lease agreements, whether that's getting leases, getting out of leases or negotiating with landlords.

Even though there's legislation in place, there are a lot of landlords that will play ‘silly buggers’ a little, and just get what they can and not do what they're meant to do under the legislation, leasing has always been a big one. Also helping these businesses with their business structures [is an issue]. This includes when they're bringing new people on board, they actually make sure they're documenting that correctly.

Some of these businesses have been changing business structures along the way, so I'm making sure that they also understand it's not only legal advice that they need, they need to go and speak to tax accountants as well. There's obviously been heaps of disputes, whether that's been with their customers, followers, sponsors, suppliers or banks.

We've done a lot helping people work out the next steps with their disputes and what the actual situation is through doing pro bono work around that and then helping them to get onto their own feet and manage the dispute proactively rather than putting their head in the sand, because it can be quite overwhelming for people.

We've also actually done a lot of work around wills and estates. I think seeing something like COVID has made people realise that in a worst-case scenario, they should get their affairs in order. Many business owners, charities and social enterprises, they've got young families.

I guess in situations that are so unusual, like what we've seen this year, people just want to make sure that they've considered everything they need to consider while they've got that little bit of downtime where they have not been able to trade.

Having worked with so many of these different small businesses, where do you see social enterprises and these businesses most commonly landing themselves in hot water?

It's actually around the cash flow and often forecasting where they're going. You'll sometimes hear these entrepreneurial speakers and coaches saying, "oh, throw your business plan away!" I think that's crazy, just absolutely crazy. I think what they're trying to say is that you need to have a path for the future, but don't just write down what it's going to be and then put it in your drawer and don't look back at it.

People need to be forecasting what they would like to see happen in their business and in what timeframe, and then work backwards and say, "okay, what do I need to do at each milestone along the way," whether that be financial, legal, marketing or what contracts do I need to sign? What staff do I need to employ? Should they be an employee or a contractor?

[You need to] think ahead of all these things so that when it comes time to making those changes, then they actually have a plan in place. Where possible also, try and have some kind of cashflow stored aside and don't spend everything you've got for when that rainy day happens.

Trust me, rainy days happen all the time in business. Look at this year, it has just been a flood really hasn't it? People needed an excessive amount of backup cashflow to try and keep their businesses afloat.

Even those people that have grown during this period of time, I mean, we've actually grown a lot, but we too needed cashflow because with growth comes financial issues as well. The second area that I see a lot of these businesses and charities getting into is they come up with a product or a service that they think is a good idea, but it's not necessarily solving an actual problem for people.

Generally, people won't get their wallet out [and maybe not so much through charities] unless you're actually providing a solution to a problem they currently have.

You can get really passionate about whatever you've invented, but if you're not solving a problem, no one's going to actually pay for it.

We see that a lot. They also take advice from people at barbecues, or people who are passionate about their cause, but they don't have any business acuity! We see a lot of bush lawyering happening, and by the time they have come to us, they've gotten all their advice from their barbecue mates or from Google, and they haven't checked whether it's relevant to what they're doing and to the area they're located in, because the laws change from state to state.

It's really hard to protect them once they've made a few key bad decisions, because you can actually contract out of some different types of protective legislation. If you've actually signed something without knowing what you've signed, that can be really bad for you.

Great insight there Katie, and certainly a lot that we can really be doing as founders. Particularly, I can relate to your comment there about cashflow and also the problem part, or not solving a problem, that's something I've seen a lot too. What steps would you recommend then to any impact-led entrepreneur, who's at the early stages of starting their enterprise?

I think it's really important that they think about what problem they're actually solving first, whether they're a social enterprise or a charity, and how you can actually somehow monetise that so that they can be sustainable.

One of the things that I got to understand a lot better, especially when we were going through your accelerator Tom, is understanding how people get really passionate about a cause. Then as an afterthought, they think about how they would need to monetise that.

It was a real privilege being able to work with people who are so passionate about something and then helping them find a way to become successful, but not everyone has the benefit of coming through an accelerator like yours, Tom. We have to try and find a way to catch them in the early stages before they make some decisions around what they're doing without thinking about what that would do to their cashflow long-term, because generally that's their life savings they're chewing up.

Also, a lot of businesses think that they need to reinvent the wheel. You can actually get into partnerships with one another a lot of the time and go and tap into the customers that another social enterprise or business already has. That's a good way to leverage each other's expertise and make an even bigger impact with what you're looking to do. That's a really great way to think at the very beginning of their enterprise, not just what they can do to make an impact, but who else they can collaborate with. Another thing is they should be looking at grants and programs that can help them develop, like your accelerator.

Your accelerator was fantastic because it went through all the critical elements that we needed to know between marketing, structures, finance, budgeting, bookkeeping, all those things, and really thinking about who is the end person that's using this service or goods that we're generating and what do they want, what are they looking for?

Really, just thinking through all those processes at the beginning, but then not just stopping there. It's reassessing that every month and saying, "how did we go with these? Where do we need to go next? Is the market changing?" You need to keep doing research constantly, [checking] are there going to be any government regulations or changes that are coming up that would stop me from being able to work in this manner? Or say do I need to go and check the awards for my employees pay rates?

It's all those little things that can make people come unstuck in their really early phase of social enterprise or even business in general. They don't know until sometimes it's a bit too late, so one of the things we're going to try and do on top of having the learning centre in Law On Earth is we're going to start doing little building blocks of business next year.

That'll be from a legal perspective, of what people can watch out for and just learning through a little E-Course what they need to watch out for. When those issues pop up, they already know to look out for it. It's just raising a few red flags for them earlier on.

You've worked with a lot of different businesses, so what inspiring projects or initiatives have you come across recently which are creating really positive social change?

Tom, there's just so many of them! Look, I love the ones obviously that are environmentally focused. I'm an outdoors kind of girl, but then there's so many people that are helping those that would ordinarily struggle in the job market as well, I've always been impressed around those social enterprises. I saw one recently that was regenerating stem cells so that people who have been in wheelchairs for the last 10-20 years can actually start walking again. It's just incredible some of the businesses and the social enterprises that you're seeing in Australia.

I think in many ways, [Australia] is actually leading the chase in pioneering new and inventive ways of helping the community. Then I think also generally speaking Australia actually seems to be a little more community focused than some other countries.

Everyone gets behind each of these incredible social enterprises and charities and just really backs them, including the government. I think that's what's going to drive everyone to having greater impact in the future years, especially after COVID. Although there's been a lot of damage that's been done to a lot of the businesses who had to stop trading, it's a really good opportunity for everyone to say, "okay, we've learned how to run lean now, what do we need to do to still have the same impact for people who really are struggling a lot more now, and make sure that we're sustainable in the future?"

I think there's some fantastic momentum in this space in Australia and certainly some more work to do too, but we're on it. Katie, to finish off then, what books and resources would you recommend to our listeners?

My goodness, there's probably a hundred books I'd recommend, but the most recent ones that I've actually been listening to were around hacking growth. Just learning innovative ways of not just doing the standard marketing, but learning, working with your operations people and tech team to just try and find ways to get the company to have massive growth.

Now, I think after COVID, we're going to see a lot of businesses that were smaller before really rise to the top, and it's going to come down to how innovative they can be to cut through butter, because everyone's going to be marketing.

Another book that I read that I thought was really great was called The Hard Thing About Hard Things. This was a story of a CEO who essentially was talking through his growth in the corporation over 20 years. He was saying things that really resonated with me having been in business for the last eight years and saying, "as a CEO, your job is to handle 50 things going on all at once and you have to get used to feeling uncomfortable sometimes."

I think the reason that resonated is that we feel as though we have to try and make things better, and sometimes, you can't always make things better in business. You just have to learn how to be uncomfortable with growing and finding a way through and just having confidence in yourself that you can find a way through the difficult times.

Then, the one my team's listening to at the moment is Measure What Matters. They would definitely be three books I'd recommend to anyone, whether it's a charity, social enterprise or business.

Thanks so much for sharing these really generous insights and your time, and we are looking forward to tracking your journey and that of Law On Earth and Virtual Legal.