331: Rethinking Legal Access, Work, and Meaning with Rafie Faruq, Co-Founder & CEO of Genie AI
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My life is all about service. And so my long-term mission is to restructure society in principles of harmony, authenticity, and kindness. And with Genie, I'm trying to restructure the legal industry with the right principles.

But yes, this is all leading to just playing a very small, tiny part in affecting the way society is structured. Because I believe we're in a local optimum, maybe even a local minimum, actually. And there is a better way to live as a collective. But it will take, I don't believe in sort of destroying the system. I believe in rewiring the system, rewiring the flows, right?

so that we're more in harmony with nature, with ourselves, and with our natural purposes in the world. Good morning, good afternoon, or good evening, depending on where you're listening. Welcome to AI and the Future of Work. I'm your host, Dan Turchin, CEO of PeopleRain, the AI platform for IT and HR employee service. Our community is growing thanks to you, our loyal listeners. We get asked all the time,

for an opportunity to engage with the community and maybe here's some clips that don't necessarily make it into the week's show. We recently started a newsletter. We will share a link to that in the show notes. If you're not already a member of the newsletter, subscribe and you'll get extra AI fun facts and some things that you don't hear in the podcast. If you like what we do,

Of course, tell a friend and give us a like and a rating on Apple Podcasts, Spotify, or wherever you listen. If you leave a comment, I may share it in an upcoming episode like this one from Don in Seattle, Washington, who's a student at the University of Washington, go Huskies, and listens while walking to class. Don's favorite episode is that great discussion, also one of my favorites, Don, with Linda Rotenberg, CEO of Endeavor, about international entrepreneurship.

We learn from AI thought leaders weekly on the show, and of course, the added bonus, you get one AI fun fact each week. Today's fun fact comes from Steve Lacera, who writes in Mix Online about the U.S. Copyright Office's recent report on copyright and artificial intelligence, which addresses the issue of whether output generated by AI systems can be copyrighted.

In it, Steve says, the use of AI tools to assist rather than stand in for human creativity does not affect the availability of copyright protection for the output. Copyright protects the original expression in a work created by the human author. Even if the work also includes AI-generated material,

Copyright does not extend to purely AI-generated material or material where there's insufficient human control over the expressive elements. I'll unpack that in my commentary. AI bots should never be copyright owners. Anything generated by AI resulted...

from deriving a new work from the work of humans. Let's celebrate human creativity and encourage humans to augment their ideas with other sources, including AI. All of the best creators throughout history have been inspired by the work of others. Let's remember the purpose of copyright protection and also remember the A in AI stands for artificial, only human-owned content

cannot be artificially intelligent. Of course, we'll link to the full article in today's show notes. Now shifting to this week's amazing conversation, Rafi Farouk started Genie AI in 2017 with co-founder Tish Muta to open source the law and enable everyone to draft quality legal documents. Since then,

Genie has served over 100,000 users across 120 jurisdictions. The company most recently raised a nearly $18 million Series A from Google Ventures and Coastal Ventures. Rafi holds an MSc in machine learning.

He's a serial entrepreneur who has advised the Law Policy Commission, published on the Law Society, and represented the Ministry of Justice on foreign trade missions. He also teaches meditation courses and is a guru to many seeking meaning in life. I've really been looking forward to this one. Without further ado, Rafi, it's my pleasure to welcome you to AI and the Future of Work.

Let's get started by having you share a bit more about your background and how you got into the space. Yeah, it's a real pleasure to be here, Dan. So thank you for inviting me. Yeah, my background's pretty mixed, actually, and perhaps even confusing. I studied philosophy and economics in my first degree at university to really learn about the world, how it operated, what makes it tick. I then went on to become a bond and derivatives trader, managing...

a portfolio of over a billion pounds for a Japanese investment bank, which was too much responsibility too early, at the age of 22. But again, fascinating to see and really understand how the world works, trading bonds with the Vatican, with central banks around the world. But ultimately, I wanted to have more of a positive impact on the world rather than perhaps just moving money around. And so that's what led me to my first company, which was a social enterprise

And then my machine learning degree after that. And finally, Genie AI, which spawned from that. There's a lot there, I know, but happy to dig into either part. When you and Nitish founded the company, it was a different era in terms of the capabilities of AI. Did the vision start with the technology, with AI, or was the vision unrelated? Was it more focused on the law and legal contracts, and then it evolved over time to incorporate AI?

Yeah, it's a wise question. And I actually wrote my MSc thesis on generative AI in 2016 to 2017. So yeah, going back seven, eight years. And I was using the algorithms that were perhaps the precursor to the transformers of today, namely generative adversarial nets or GANs.

which are actually more complex than the algorithms we have today, ironically. So we started Genie because we had these generative algorithms that could generate text. And the vision was, could we generate legal contracts end to end? So we are democratizing the ability to write legal documents. But, you know, that's in some ways the wrong way around, because we are a solution looking for a problem. And so after speaking to hundreds of lawyers and law firms, we became really inspired by

how they have all, law firms have all these documents, precedents, past data. They're making small tweaks and they're reselling it for tens of thousands of dollars or pounds. And we thought, if we can just get AI to enable everyone to have access to this knowledge when drafting,

it would really give everyone access. So you've come to market with this large library of legal agreement templates. Describe the role of AI in the process of modifying those templates. Yeah, so we initially started by open sourcing hundreds of legal documents because we thought it was the right thing to do. And then what we built over time was an AI assistance, which now sounds obvious and AI assistance are everywhere.

But seven, eight years ago, it was maybe not so obvious. What makes the AI Assistant useful, and we believe the best in class, is that it's an agent that can do multiple document tasks in one call.

So you can say, hey, draft me a software license agreement for my company, include these key terms, highlight any risks in red, and add any comments for Joe that may be relevant to him as an HR manager. And it can do all of that together through a chain of actions and making a plan and so on. So the use cases are both preparing a new contract, as well as editing, as well as redlining one that is in process. Is that fair?

Exactly. You can upload third-party documents, you can create from scratch, use templates, any of those flows. I mentioned in the intro 120 jurisdictions. One of the challenges I imagine is that these agreements are highly dependent on where they're being issued and executed. How do you train AI to be kind of geo-aware when it comes to very specific jurisdiction-related requirements? Yeah, so we test the AI regularly.

on major jurisdictions namely US jurisdictions both federal and states and UK and some European ones. We don't test for every jurisdiction in the world because obviously that would be very difficult so we don't guarantee quality all over the world but we do use for major laws and major jurisdictions RAG approach, retrieval augmented generation which I'm sure you're aware of

where we essentially conditioned the model to look into past legislation and case law for which we have databases for. All AI is ultimately a data problem and startups live and die based on kind of the size of the data moat, so to speak. I know it's an awful cliche, but the size of the data moat that they surround themselves with. Given you said you started off by open sourcing this library of templates, what's the data moat for Genie?

Yeah, so I think the data game has changed somewhat. Language models, as we all know, now have access to not just all public data in the world, but they have moved to creating lots of private partnerships with the big data providers like Reddit and so on, Financial Times, New York Times. So

What's more important in this day and age, in my opinion, is access to private data flows. And so for Genie, because we have, I think it's now over 120,000 users on the platform, drafting, reviewing contracts, negotiating, we actually have access to how people negotiate documents at the clause level across many jurisdictions and industries.

And this is data that open AI and so on will never be able to access because it's private information about contracts being negotiated. But that gives us the edge in telling the world what is market standard, what is commercially viable, what's more favorable, given your geography, your industry, your company size, and so on. So that's really where we're going with this, essentially trying to build a global legal brain of intelligence.

Makes sense. So because of the RAG approach and because of the size of the community, your data grows every day as more people use the platform. Exactly. And it's sort of a quid pro quo because we've always kept our pricing pretty cheap. We've kept that application very open, open source and documents. And in return, our community is giving us the information flows, which again, we return to them in the form of market insights. One of the fascinating things about the space that you're in is that

The cost of both false positives, the AI recommends something that's wrong, or false negatives where maybe there's a mistake, an error in the contract that it misses, can be enormous. I mean, lives can be harmed, laws can be violated, financial penalties. I can only imagine.

What do you think about in terms of the responsibility that Genie has for the downstream implications of the contracts that Genie AI proposes? Yes, this is also a great question. So for us, false negatives are a lot worse. So if we miss, let's say we have one algorithm that spots risk in documents and highlights red flags and yellow flags in a traffic light system. If we miss a red flag,

that's potentially drastic. Whereas if we say something is a yellow flag and it's not, it's not the end of the world. So, you know, a simple approach is we do make our algorithms a bit more sensitive than perhaps needed. Of course, it's a balance because we want to save people time as well. So yeah, legal was fraught with these trade-offs. Another example is for those who write legal documents know that sometimes you want to keep language a bit vague just to let the document be flexible and take into account different scenarios.

But then most of the time you want to be specific because that's going to hold up in court more clearly. So there are all these trade-offs in legal and there's often not an absolute correct answer. But I would just say, again, that is actually a good AI problem because AI has millions, billions of parameters and can take all those factors into account to make a final decision.

To that point, it's always worth considering when we look at harms that AI can do, the corollary harms that people can do, because it turns out people are error prone as well.

Yet, you know, somehow it's easier to scapegoat or, you know, assign blame or penalty, penalize the AI because it was an automated decision. One of the things that a lot of vendors, AI-first vendors have started to do is actually indemnify the customer in case anything the AI generates ends up creating legal issues. If you thought about it, is it something your customers request? Or how do you think about defending the integrity of the AI-based, the automated content?

Yeah, we've thought about it, especially in the form of insurance. So we have extensive insurance ourselves. We haven't, to this date, made this available to the customer. Rather, we focus on quality. For us, we've always found trust is a major, major issue. And the main factor that solves customer trust is just simply quality. And so for all our AI features in the product, we have

the usual thumbs up, thumbs down, feedback mechanisms after each feature. And typically, the way we do it is we basically track only lawyers and attorneys, their feedback on these particular features. And we typically average around over 91% accuracy on most of these features.

So we just track is that going up or down and keep that as high as we can. You recently recorded an interview with the BBC and you're asked this question, and I suspect you get this question a lot, as do I, about the impact of what Genie's doing on jobs. It's automating a lot of the menial work that a paralegal would do, sometimes even attorneys would do. And it's hard not to.

to consider, you know, the moral, the social obligation that you have. And if you play out when, you know, Genie is wildly successful, what does that market look like for legal services? Yeah, it's really interesting. You know, I was often, I was reflecting back on the TV interview where the reporter on national TV asked me three times, you know, what's going to happen to jobs and so on. Gave a brilliant answer, by the way. That's why I asked you the question. I really, I want our audience to hear your perspective on that.

Yeah, no, I appreciate that. I appreciate that. And I think it is an important question. It's multifaceted too. The obvious answer is that, or the immediate answer, which is perhaps the boring one, is that our clients who are typically in-house lawyers, they typically want to do the exciting work of the next investment deal, the next M&A transaction, advise the CEO. They don't want to do the day-to-day NDAs and employment contracts. And that's where we come in.

But what's more interesting is what is the greater impact on jobs? One thing I will say is, and this is where it gets philosophical, I actually think the objective function of society, which is productivity, GDP growth, I think that's served us well for the last 50, 100 years. But

I don't think it's going to serve us well for the next 100 years. Because if all you want is endless GDP growth, all you're going to get is endless AI, endless productivity, and endless growth in countries and borders and ultimately conflict. Because if everyone's having more, something has to give. You know, nature works in balance and cycles.

So we need to find that same harmony in society, that same balance, rather than a more is better paradigm. I believe that part of what it means to be on Team Human is to think about why every human was put on the planet. And I think AI forces us to ask a really important question, which is if the work that you do is menial or repetitive to the point where it can easily be automated,

buy a bot, maybe it's okay. Maybe this important time is an opportunity to ask the question, is this my life's work? Maybe just, maybe there's something more fulfilling that I could be doing. And maybe this is an opportunity, you know, a wake up call for me to go and discover myself, test my capabilities, you know, find a real passion. Um,

You know, you and I are AI optimists. I think it's easy to take that side of the argument. What's your perspective on that? Yeah, I mean, first of all, I love that you said that because the dawn of AI is going to force us to realize what it means to be human. Because, I mean, first of all, I don't think we should compare AI to human intelligence. AI will have its own form of intelligence that goes...

Right, like way beyond what we can possibly imagine. Nonetheless, if you did have an AI that looked like Dan, acted like Dan, smelled like Dan, was exactly like Dan, then the question is, okay, what makes me different to this AI?

And that's when we realized that, okay, to be human means social connection. It means emotions. It means creativity, arts, meaning, maybe even soul. And that's a potentially exciting direction for humanity that's not just based on droning around spreadsheets and so on. I do think, and I'm not afraid to say at this point, jobs will go.

and jobs will change. But let me add to that, 10 years ago, or even 20 years ago, if you were to talk about social media influencers or prompt engineers, people would think you're crazy. So jobs will go. But also, the jobs of tomorrow, we have no idea what they will be. And there'll be many of them. The job titles will be all sorts of titles that we can't even imagine today.

And that's something we can be excited about. We're having this conversation with you sitting in the cradle of the first industrial revolution, 15th century England, where the Luddites, the machine breakers decided that the best way to resist innovation was to go and break the machines, the things that were disruptive. And whether it's the Luddites or other movements throughout history, when you're on the wrong side of innovation, history doesn't treat you well. To your point, there are going to be amazing new opportunities.

Think of all the jobs that the web created. And, you know, there was all kind of hue and cry in the 90s about, you know, the death of print media jobs. And you know what? We were...

we're resilient. We find ways to make good use of humans. And maybe you have to squint a little harder this time around because AI seems so human. But I think now is when we have to be having that dialogue. Yeah, I agree. I think that's an interesting conversation around intelligence and what that means for humanity and AI. Because this time around, there's an argument to say humans are becoming less and less intelligent because AI is doing everything for us.

And I think that there is somewhat of a risk because how do we train the younger generation if experts are being taken over by AI? But I think the answer to that is yes, you may become less intelligent along the vector of brain stuffing intelligence. So that's the intelligence of today. It's like, who knows the most facts? Who knows the most processes? But the intelligence of tomorrow...

will be more of a dynamic, creative, inspirational, even emotional intelligence. So on the one hand, we might be losing, and no one knows how to, no one has directions and maps in their heads anymore because Google Maps is everywhere. But more and more people are understanding the concept of emotional intelligence, of mental health, of social connection, of community connection,

So there's a whole new dynamic that could open up for humanity that we are just on the precipice of. Let's ground the conversation. So you're an entrepreneur and your product, your team, your influence casts a wide shadow. And whether you had intended to or not, you're

catalyzing this conversation and this thought process. How do you think about your responsibility as an entrepreneur growing a tech company that's really at the heart of these important conversations? How does that impact your leadership, the strategy that you have at Genie? Yeah, I think it's really important that people like myself take action and are proactive and activists about

implementing AI in the best way for society. It is odd and it is funny, you know, as an individual entrepreneur, when we start out, we just have these startups, we're just going to make it and then suddenly you achieve a little bit of success and it's like, actually, I have responsibilities. So we're working on an AI ethics white paper, which I hope won't be just fluff, but will actually give practical recommendations such as, I don't mean regulation, I mean guidelines. For example,

there could be a list of questions to check how biased your AI outputs are. And let's still leave it to the free market and for consumers to judge what's good and bad, but let's provide tools and guidelines as to what is good and bad. I love that approach. And when that's available, please let me know and I'll share it with the community.

A lot of the reason we do this podcast is because the community of people who think like us is growing, but it's small. And just having the conversation about AI ethics and being able to tie what might feel like a very capitalistic pursuit, sharing legal documents with the world and charging a subscription on a SaaS basis and, of course, use AI to

manipulate or edit the documents. It can seem like just a business or a high-tech startup, but it's so much more than that given the broader societal implications. So I'm really glad that you and the team are thinking ahead. How do you tell you have an amazing board, amazing investors? How do you convince them that that's a good use of their money and your time? I think we do have a really great team of investors and they're very active and very supportive of

But I think they also understand this is a pivotal time in humanity's history. And we want to look back on this and say, we've done the right thing. Yes, it is ultimately about money, but more so it's about impact. And I left a banking job trading millions of pounds because I want to have a positive impact. So that is actually my number one priority. And I believe if you have a good impact and try to do the best for people, people will reward you by paying for your services.

I've watched you online leading meditation classes and I've seen how people respond to your philosophy and your thoughts about finding meaning and purpose in life. Who is Rafi Farouk? Why were you put on this planet? That's a deep question. I must say, I don't know if I can take the title of guru, which you mentioned in the beginning, but my life is all about service. And so my long-term mission is to

restructure society in principles of harmony, authenticity and kindness. And with Genie, I'm trying to restructure the legal industry with the right principles. But yes, this is all leading to just playing a very small, tiny part in affecting the way society is structured. Because I believe we're in a local optimum, maybe even a local minimum, actually. And there is a better way to live as a collective.

But it will take, I don't believe in sort of destroying the system. I believe in rewiring the system, rewiring the flows so that we're more in harmony with nature, with ourselves and with our natural purposes in the world. You shared interesting insight online recently about,

kind of an inflection point that you reached as a company where you brought, I think, your leadership team together and said, you know, kind of, I'll paraphrase, obviously, you say it better than me, but, you know, what got us here may not get us there. You know, it's okay to kind of do a rethink and maybe a check-in, a reminder about why we're here and what we're doing. Talk us through that moment and maybe also just kind of how you're

your philosophy on life, your kind of spirituality, how you bring that to work and how that influences the company culture. Yeah, absolutely. So I'd describe myself as spiritual, but not religious. Not that I have anything against anyone religious. I celebrate all paths, but I believe all of life and work itself is spiritual. For example, we structure our company, our teams in similar formations that you find in nature. You know,

seven plants around the world. Seven is like the two pizza team. You can create projects in terms of fractals. So you can do check-ins so that you have many at the start and they cascade out slowly over time, like a fractal. And even building business is actually much like music and sound. Because when you're working with your employees...

you're typically working up to a big chorus or crescendo, but they can do their best work and work their hardest. But you can't have a chorus all the time, otherwise people get burnt out. So you need a regular beat, you need a regular rhythm, you need a coherent verse. And then you have your big moments as a company where you come out and release big innovations, product releases. So all this to say that

All of life and all of work is spiritual. I believe people do their best work when they're in their best state of mind and heart. When they're stressed, they're clouded, they may make bad decisions, and direction is more important than speed. So it's all about how we structure the company, how we run the company, how we run ourselves, and being able to work effectively whilst not getting burnt out, stressed out, and so on. Unfortunately, we're bad at a time. This has really been a great conversation. I...

Love to have you back. I know we're just getting started, but you're not going anywhere without answering one last important question for me. As you know better than anyone, the life of an entrepreneur, certainly a high-tech CEO, is filled with daily peaks and valleys. Probably a bad cliche, but I think you know what I mean.

Um, how does your perspective on life allow you to handle the valleys? It's easier to handle the peaks, but, uh, you know, how do you, how do you channel kind of that inner mindfulness when, when you're entering a room, you have to share an unpopular opinion, you have to make a hard decision.

What's your approach to the hard parts of being a CEO? Yeah, it's a journey of 30 centimeters. So from the head to the heart. I'm a big believer in karma yoga. And in karma yoga, which is the yoga of right action, they say that there is no doer. There is no you, no ego. And as long as you realize that there's no you, then you don't really get stressed out because there's nothing to get stressed out about because you're not affected.

As long as you're aligned, centered, doing what you believe is the right thing, everything else will flow. Rafi, 330 episodes and I've never heard that reference, the journey of 30 centimeters, which is beautiful. And I think that my blood pressure went down just having this conversation. So I'll thank you for that. Really happy to hear that. Hey, Rafi, before I let you go, where can the audience learn more about you and the great work that your team's doing?

Absolutely. You can find us on genieai.co. And you can find me, Rafi Farouk, on Instagram, YouTube, LinkedIn. Excellent. Well, we're going to find other ways to team up and you've got an open invite to come back and hang out, all right? Amazing. Thanks a lot. Good. Well, gosh, that's all the time we have for this week on AI and the future of work. As always, I'm your host, Dan Turchin from PeopleRain. And of course, we're back next week with another fascinating guest.

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