DISCO’s New CEO Says Company Is Overcoming Challenges and Getting Back to Growth

When Eric Friedrichsen stepped into the role of chief executive officer of e-discovery company DISCO four months ago, he was taking the helm of an enterprise that had faced turbulent waters in recent years. Its founder and longtime CEO Kiwi Camara had left under a cloud of sexual harassment allegations, and its 2021 public offering had seen its stock quickly take a nose dive from its early peak of over $65 to its current price of just over $5.

But in DISCO, Friedrichsen saw a company with challenges he believed he could help resolve, and with a strong product and passionate customers that added up to a formula for a future of strong growth.

Today, he says, DISCO is a company where customer and employee satisfaction scores are rising month by month, and where one can feel “incredible energy” when one walks through the hallways of the DISCO offices.

Friedrichsen told me all this during a sit-down interview this week at ILTACON in Nashville, where he talked about why he joined the company, the challenges the company faces, and what the company is doing to enhance the employee experience, the customer experience, and the product experience.

Read more about DISCO in the LawNext Legal Technology Directory. 

He came to DISCO after having been CEO of Emburse, LLC, a provider of expense management products, from January 2020 to January 2024. Previously, he was global head, commercial, SMB and growth markets, at Marketo Inc., a provider of marketing automation technology and a subsidiary of Adobe Inc. From 2008 to 2018, he held a series of executive and leadership roles at SAP and SAP Concur.

Three Principle Challenges

As he joined DISCO, he told me this week, he perceived the company as facing three principle challenges: improving its culture, increasing its revenue, and implementing greater operational effectiveness.

The cultural challenges were, in part, the result of the circumstances that led to the departure of Camara and the media coverage of all that, particularly by The Wall Street Journal. But Friedrichsen said the challenges also stemmed from the company having been run in way that did not take full advantage of the talent it had.

“Going forward, what we’ve really tried to do is make sure that we are empowering all of our great talent,” he said. “We’ve got phenomenal people across that business who understand the legal tech industry and e-discovery and technology, and they weren’t always able to flourish as much and share their input and ideas and leverage all that great knowledge.”

As for increasing revenue, Friedrichsen sees significant opportunity just within DISCO’s current customer base. Increasingly, he said, customers come to DISCO not just on a matter-by-matter basis, but for multiple matters, and across multiple product offerings covering a broader span of the litigation workflow.

Disciplined and Transparent

I asked Friedrichsen whether DISCO’s status as a publicly traded company presented opportunities or challenges not faced by its competitors.

While he would not speak to the challenges faced by his competitors, he said, he believes that a major advantage of working for a public company is that there is no choice but to be disciplined and transparent about how the business is run.

“You have to make sure that you are operationally strong and that you’re conducting your business in a very transparent and effective way. And I just think those are really good habits for any business, whether you’re a public company or not.”

The flip side of that transparency, of course, is that your competitors know what you’re doing. But Friedrichsen said he does not worry about that.

“We’re just going to run our business, and we’re going to go deliver the best way that we can. And I’ve got confidence in our team that even if our competitors do know what we’re doing, we’re still going to deliver.”

With regard to operational effectiveness, Friedrichsen said that, for all DISCO has achieved as a business, it has not necessarily built some of the systems and processes that would normally be in place for a company of its size.

“For us to truly be able to scale and deliver the absolute best customer experiences, there’s just certain things that we need to do,” he said.

Those things include building out its customer success function to be much better than it has in the past, rebuilding its sales enablement function, which he said was reduced quite a bit over a year ago, and running a quote-to-cash project to reorient the way the company thinks about that process.

Bringing On New Talent

Another priority for Friedrichsen has been to supplement the company’s talent by bringing in people who have “been there, done that” in helping a company scale. He wants to see the company grow from the $140 million in revenue it is bringing in today to one bringing in more than $300-400 million.

One example of that new talent he is bringing into the company is Richard Crum, who has joined the company as its new chief product officer last month after having been in the same role at Emburse. DISCO is also bringing on a new SVP of operations and a new general counsel, and has already brought in new experienced sales leadership throughout the organization.

“I want this to be a place where, when people retire years from now, they look back and say, ‘Wow, those were the absolute best years of my life.’ And I really want our customers to have that feeling too. I would like it to be where our customers want to attach to the DISCO culture and they want to be part of our community.”

What is that culture, I asked him.

Number one, he said, is a culture of customer focus.

“That doesn’t necessarily mean we do every single thing that every customer wants us to go do, but that we’re focused on helping drive value for our customers and solve the problems that they’re facing on a day to day basis.”

Another key part of the culture, he said, is leading with innovation. “There’s opportunity to innovate and deliver more value for our customers that they may not even be aware of”

Along with customer focus and innovation, a third leg to that stool is collaborating with customers. “Getting their feedback and input in the process is a big part of it.”

Focus on Generative AI

On the product side, Friedrichsen said a major focus will be on continuing to bring generative AI into the platform and into the e-discovery process. This month, it launched Cecilia Auto Review, a product that enables users to perform first-pass document review using generative AI. He said that he is extremely excited about that, which follows the launch last December of Cecilia Q&A and Cecilia Timelines.

He cited a recent example of a customer with 3 million documents who needed to quickly hone in on a “who knew what when” scenario. Using Cecilia together with assistance in prompt engineering from DISCO’s professional services team, the customer was able to quickly get the hottest documents that could tell them exactly what they wanted to know.

“Within something like two hours, they were able to very quick figure out what they should do with this matter,” he said. “They thought it would have taken them 200 hours had they not had Cecilia Q&A.”

“There’s potentially a real game changing opportunity ahead for this industry,” Friedrichsen said, “and I think there are certainly people, lawyers, who are nervous about gen AI, but there are that many more who have just recognized, based on the meetings that I’ve had, that gen AI is coming and they want it to come because they want to take advantage of the opportunities.”

At the same time, he recognizes that lawyers want to make sure that they are mitigating their risks and that the results of the work that is done using gen AI are defensible.

DISCO is addressing these concerns in multiple ways. For one, its AI products are packaged with AI consulting services, to help ensure that the review is handled in the best way.

In addition, as its Auto Review product tags documents, it explains why it tagged them as it did, so the lawyer can look at each one and make a decision as to whether the lawyer believes it was correct.

Also, because of the product’s speed – Friedrichsen said it can tag 3,800 documents an hour – it affords the opportunity to review the entire set of documents, not just a subject, or even to re-review the documents if you wanted to tweak the instructions after the first pass.

“I wanted to join a company that was growth oriented, where growth was the number one focus,” Friedrichsen said. “And that’s where we are with with DISCO — it’s getting back to strong, strong growth.”