Beth Stevens is Head of Legal and Brokerage at Opendoor, a rapidly growing real estate technology company that operates in over twenty markets and purchases more than $2.5 billion in homes annually. Before Opendoor, Beth was General Counsel at Sidecar, a ride-sharing company, and at Earnest, a student loan refinancing company. If there’s one thing that impresses me the most about Beth, it’s that she’s been able to help her companies grow quickly in markets that are highly regulated. Navigating challenging regulatory regimes is difficult enough; doing so while that company is doubling or tripling in size is herculean.
I sat down with Beth to talk about how she thinks about hiring, scaling with technology, and dealing with uncertainty and change. Here are a few of the key takeaways:
- Hire for experience, but balance that with plasticity. You need lawyers who are able to adapt to changing situations and who are willing to roll up their sleeves when your company faces new challenges.
- When making the case for headcount or more resources, frame your request in terms of key business drivers and time saved. Ticketing systems and NPS surveys can help you quantify and strengthen your argument.
- GCs can establish trust with the rest of the company--and Engineering teams in particular--by meeting with Product teams to ensure that legal safeguards are “baked in” to the company’s workflows and software. That way, Legal is seen as a thought partner instead of a blocker.
Hi, Beth! You’ve been GC at a ride-sharing company, a student loan refinancing company, and now a real estate company. How have you managed to get up to speed on complex regulatory issues across all these different industries?
I have a joke around here that when the lawyers hit their two-month mark, they're like, "Holy crap, what did I do? Why am I here? I know nothing!" But you learn by picking up and reading lots of things, attending continuing legal education (CLE) courses, asking a lot of questions, and by reading a lot of regulations. It comes down to learning from experts, being willing to roll up your sleeves, and being smart about hiring.
Learning from experts. At Opendoor, you have to really understand real estate rules, which are really very complex. Adding mortgage and title products also adds to the complexity around how we operate. On top of that, we need to make sure that we're complying with the rules in each and every state where we operate.
In my role, I manage the real estate brokerage team because of the compliance angle, so I needed to learn from experts. I’ve been lucky to have really great partnerships with what are called designated brokers or qualifying brokers. They’re the real estate professionals responsible for compliance in each of our real estate brokerages. They're wonderful people who have deep experience in real estate, so they've been a great partner for me to ask questions and learn from.
Rolling up your sleeves. I'm a litigator, and to me it makes perfect sense that litigators tend to thrive in regulated spaces. Most general litigators have no idea of the subject matter that they're going to be working on, especially at the associate level, so you have to learn how to roll up your sleeves and figure things out. I think that's true of regulated startups, particularly where you're on the cutting edge of how things are done and how to interpret things in a new way.
Thoughtful hiring. I always tell my team, "Hire the most senior person you can trick into coming to work for you." My first hire, for example, was Vanessa Gage, who was a partner at Pillsbury when she joined us. It doesn't mean that you have to bust the budget. There are people who will want to work with you and who are excited about how hard the problems are. If you focus on the right things, you can get really amazing talent without having to match their law firm salary. I'm very upfront about needing to handle a lot of different types of work, especially early on.
It’s important when you’re hiring senior people, though, to always look for plasticity. How are they able to react in new situations? Are they able to say, "Okay, this is a little weird,” and figure things out? Are they able to roll up their sleeves and do the day-to-day work?
I think the hardest challenge actually isn't managing the day-to-day. The challenge is actually carving out the time to do the strategic work. How do we think about the thing that's coming around the corner? How do we build foundational processes that are going to let the attorneys be highly leveraged?
How do you do that--how do you carve out time to think strategically--with only ten members on the legal team? Can you offer any tips on how to make make the case for more resources?
Legal is always being pushed to do more with less, which means you have to fight really hard for every single legal team member you have. I think the thing that you have to do when you ask for headcount is to make the business case for it. At its core, it's not dissimilar to the way a litigator thinks about, "Should we pursue litigation or not?" It's the same sort of thought process, and the answer is, what is the cost and benefit of adding an extra person.
There are two factors: time and money. So, do I need more people to be able to reduce our service level agreements (SLAs), or do I need more people to reduce cost? Identify the drivers of growth--for us, it’s headcount and city expansion--and make a case to your business partners in those terms. You need to be able to say, "Hey, wait, I'm spending X amount of money on this task with outside counsel. I could hire a junior lawyer or a senior lawyer, a paralegal, whatever the right person is for that task that can do it for half the costs.” It doesn't have to be perfect. You can do estimates. We're in the process of updating our contract management system and our ticketing system, which will allow us to have concrete numbers on how long different tasks take, and how much money we could save if we sped them up.
We’re also implementing an internal Net Promoter Survey (NPS) to the partners that we work with in the company and asking a couple of questions about their experience with their legal partners. How responsive did you feel they were? How well did they seem to understand the issue that you faced? I'm working on building this survey but I think there has to be one consistent question that we track every time: “How willing are you to ask your legal partner for help in the future?" I think that what that will signal is, "Are we, as a legal team, doing a good job of servicing our internal clients?"
We ask our engineering and product teams to track how fast or how long it takes them to build certain things and the turnaround time for responding when there are bugs in a system. I think the legal team has to think about things in the same way and to show that we're just as data-driven as our engineering and product partners. That makes us more sympathetic to the challenges they see.
How do you think about technology’s role in scaling a legal team?
Technology is critical. I think if we try to do everything manually, we are going to die a slow death and burn folks out. Internally, our biggest challenge is figuring out how to build the infrastructure to support a business that's growing as fast as ours. That's something that we actively work on and talk about every day.
One example: we’re focusing on automating contracts wherever we can. I think Ironclad has been a great partner with us in automating a number of the agreements that we have that lend themselves to that work.
Another example is using a system to track inbound service requests. Email just doesn't work. We've grown out of that. The nice thing about ticketing systems is that people who have submitted requests can have visibility into who is managing their request. Who is answering the questions and where is it in the process?
The underlying challenge is the same one that every single one of my technology company peers has, which is building trust, particularly with your product and your engineering department. Trust ensures that you've got a good idea of all the risk that's flowing through the business and you're appropriately addressing it for the level of risk, the consequence, and the likelihood of recurrence. So thinking about risk that way and building things that makes sense to the rest of the business is really critical.
How can Legal build trust at a fast-growing technology company?
There are a lot of companies out there that don't have access to in-house counsel, so many engineers have been at companies or in industries that aren't heavily regulated. It can be difficult to adjust to working in spaces like financial, healthcare, or real estate technology where lawyers are being hired earlier and earlier and they're a key and critical part of the growth of the business.
I also think a lot of engineers, especially inexperienced ones, might just have a natural skepticism. The may think, "Oh you're just here to block me. I can't move fast and break things if there's a lawyer in the room. You're just going to say no."
I've heard all of those things throughout my career, but then there are also really amazing engineers and product people who understand the value that a good lawyer can bring to the table, especially a lawyer who is there in the trenches with the engineers and product people. Ideally, you have lawyers who are trying to solve problems in a way that's creative, in a way that achieves the goals of the business, and in a way that allows the business to grow as fast as it wants to grow.
And we know as lawyers very few things are black-and-white, particularly in the types of regulations that we're talking about. There is a lot of gray. So the question is, how much do you want to live in that soup, and are you willing to take a little risk? There are going to be some things where you say, "Absolutely not. It absolutely has to be done this way. Period. End of story." And there will be other things where you say, "Maybe we could see what happens here."
If you could share a learning with yourself when you first started out in your new role as a GC, what would that be?
That's a tough one. I think the main one is not to take things so personally. I know that sounds silly, but I think most of us lawyers are incredibly Type A. We need our gold stars. We want to do an amazing job. When we come from law firms, we're kind of used to being “large and in charge.”
When you join a company, you often find that legal is not the most important function in the business. It's an important function and it plays its role, but it's not the most important. I think sometimes it's easy for you to forget that as a smart, hardworking person, and you're like, "Wait a minute, why did I get locked out? I have things to say!"
It's important for people who are starting in their first GC job to just keep that in the back of their head. Be smart about when you talk and when you don't and be smart about how you phrase things and how you partner with people. Always look for opportunities to build trust where you can.
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