Peter Carayiannis

2Very well, Pulat, thank you very much. How are you today?

4Well, it's kind of you to say so, thank you.

6Well, I— first of all, I don't even know that I've looked at that for a little while. So this is a great question. This is certainly not where I thought we'd start off. What do I have to say? I'll start at the back and work my way forward on this. It doesn't— I never counted them. I honestly had never counted them. So that's news to me that that was the number or that even that that's a lot by LinkedIn standards. But I definitely knew that I had some recommendations. And I also know that I made a conscious effort, certainly when anybody would ask for any kind of feedback or any kind of a recommendation, I always made them.

7There's a great book that I read a few years ago, it's called The Go-Giver, and in this book, which I would strongly recommend to anybody that might be looking for a very lighthearted, easy to read, and easy to digest business book, but told in the manner of a story, that just has some really strong truths. But the go-giver turns upside down the idea of a go-getter. You know, you're out there in business and you're a hustler and you're a go-getter. And what the story is, is you really, you know, what you get is actually what you give, which is, isn't that a Beatles song, right? We've got that lesson from Paul McCartney and John Lennon many, many years ago and set to a beautiful song.

8But one of the interesting points is that for the circle to be complete between giving and getting, you have to also be able and willing to receive something from somebody else just as easily as you're willing to give something to somebody else, whether that's a gift or recommendation or feedback. And a lot of times it's harder to receive. You know, people feel embarrassed. You feel like you don't deserve it. You feel like you didn't earn it. You feel like, you know, it's okay. You don't have to do anything. But when you do that, you are actually denying the other person the moment where they are expressing a generosity to you. And when I read that, it really struck me that, that, that instinct that you think that comes from a good place, to say, you don't need to, I don't need that.

9You don't need to give it to me. It's okay. Is actually a little bit selfish in its own way because it denies the other person that opportunity. And so I had never thought about this before you asked the question, but I think probably the reason why the number of recommendations and the number that I've received and the number that I've given is so closely is that I probably made a point of trying to give recommendations as much as getting recommendations. And I tried to complete that circle I don't know if that's true or not, but that's my story today and I'm sticking to it.

11Yeah, born and raised, local boy.

13Yeah, Michael Power, St. Joe's. Go Power!

15That high school is in Etobicoke. It still is in Etobicoke. And I grew up, like many things in my life, interestingly enough, I sort of, I grew up on the boundary between Etobicoke and Mississauga. Anybody that is getting this podcast or this interview locally would know that. For people out of the area, the Etobicoke and Mississauga would be, if you will, the inner suburbs of the city of Toronto, but, you know, right on the line. So at that time, there was still a lot of undeveloped farmland in parts of it, or not very far away. You could drive for a few minutes and be in an apple orchard, literally. In fact, the home that I grew up in, I was born in High Park, It's where my parents lived, just a few blocks away from High Park.

16But the house that I lived in was a redevelopment from an orchard, a fruit orchard. And even while I was growing up, there were still— they had taken the time, built— can you imagine? They would never do this now. They just raze the whole thing. But the developer had taken the time to protect apple trees on people's homes. Not everybody, but when I was growing up, there were still apple trees and peach trees and cherry trees that were part of the original orchard when they bought it from the farmer. But so I grew up in Mississauga, Etobicoke, and I kind of had a foot in both camps. So at the time in Mississauga, we were running wild going up and down the creeks and ravines on the weekend, and, and then I could hop on the subway and in a few minutes be all the way in downtown Toronto.

18Probably, probably my argumentative nature took me there and how close political science might be to politics in general. So I've been active in politics my entire life. I was on student council in high school and student council in university and student council in in law school, or the one of I was the president of the student body. That's always attracted me. Politics in general has always attracted me. And I've always felt, once I was exposed to political science as a subject matter, I felt like political science in many respects was history taught properly. And maybe it was just my experience of how I learned history, but, you know, it's interesting how you put that.

19Now, here I was, a boy that had been exposed to parts of the city, the development of the city, the changing parts of the city, and that is something that fascinates me always. Anytime, anywhere, whether it's in Toronto or any other part of the world, where I can find lines that take us back in history roots of the city, stories in the city. I'm always very interested in that. But I think my experience with history as a student and as a subject was that it was very linear. And political science as a subject that I learned was more dynamic. So more things coming together to touch that line. Because that's the way it is.

20I mean, we, you know, we study history as a subject, And, you know, 500 years from now, somebody might be studying— well, 500 years from now, somebody guaranteed will be studying the pandemic and what we've lived. And we, you know, the last 12 months, we can definitely create a line and say, you know, March 12th, 2020 and March 12th, 2021. And we can create a line, but we don't experience— none of us have experienced that as a straight linear thing. Things have come in from different worlds, different or different countries rather. Not different worlds, but different countries, different environments, different socioeconomic levels. What I am experiencing now as a pandemic with my wife and my 3 children, and we live in Etobicoke now, very close to where, where I went to high school and that was not necessarily by design, but, you know, certainly the roots of that are there.

21But what we've experienced as the pandemic is not necessarily what has been experienced in the pandemic in the long-term care home that is literally not a 5-minute drive from my front door. I, in fact, I could bicycle there in probably 10 or 15 minutes. And if we were to go to North Etobicoke, which is an entirely different socioeconomic part of the city relative to Central Etobicoke, that would be a different experience of the pandemic. And so I've, I gravitated towards political science because I think my experience with political science was that it was a more dynamic and fluid interpretation of what happened in a particular historical setting. Does that make sense?

23I had the better part of a gap year. Yeah, I deferred law school for a period. I did, not a full year, but I was able to defer my admission. The school that I went to in Michigan State, which was at the time in Detroit, Michigan, they started their classes in two cohorts. They had a fall cohort or August. They started the third week of August and then a January cohort, and I was able to defer that. To January and start then. So it wasn't a complete gap year, but it allowed me to work.

25Nothing's wrong with any of them. I think it would probably be better to look at my approach to the admissions process at any of those law schools the first time around. And in fairness, it might be my approach to my academic performance in undergrad and what that might have looked like to the admissions committee at Osgoode the first time around. I so I went to, I went to law school in the States. I didn't know exactly what I wanted to do as a lawyer, and you know that it would actually be a little while before I even— any of that came into focus, but I did like the idea of international relations. I did like the idea of international trade and commerce.

26I didn't really know what that meant. A lot of people in law school say they want to do something international, but You know, what does that really mean? And Michigan State offered a program in Canadian Studies and they were based in Detroit. And, you know, a minute ago you already touched on it and I really would never want to be cross-examined by you in real life because I think you've intuited something there. But, you know, I grew up in suburban Toronto, but on the boundary between two cities. And I ultimately ended up in law school on the boundary between two countries. I lived in Windsor and I went to school in Detroit for two out of the three years.

27And in the third year of law school, I moved to Michigan, but I have found myself at so many junctures in my life to have a foot in two camps, even my background, my father's Greek, my mother's Irish. I have a foot in two cultures. Because of that, because of my family background. So I was attracted to the Canadian Studies Center at Michigan State. I was attracted to the prospect of learning the American legal system. So, you know, as Canadians, we're, you know, obviously we sleep next to the elephant and we absorb and understand so much of American the American political system, the American legal system, American culture, and we just get it by osmosis, or we get it through consuming mass media.

28But it was attractive to me to actually go and learn it directly. And ultimately, I was really attracted to the idea of learning in an American setting, learning about the American legal system, and learning about American society that way. And it turned out to be a very good decision for me. It was a really, it was a very rewarding educational experience. I made great friends. I learned a lot about myself and I learned a lot about our neighbors to the south by going to law school there. And then I came back and I got into Osgoode Hall and I did a year at Osgoode and became a Canadian lawyer too.

31Well, it's, it's, it's pretty rare. I, my sister and I, we're definitely two Irish-Greeks that we know of. And, and I don't know of too many others. I did meet one once. It was the opposite. It was a an Irish father and a Greek mother, but it's not a common combination. They met here in Toronto. That is probably the most understandable part of it, that they met in the '60s when, you know, immigration from Europe was probably at one of its post-war peak, and that created the, you know, the the right environment for people to mix and meet and build lives together in this fantastic country, in this beautiful city. But it's— listen, you are by far in the majority.

32Most people assume that with a name and a look like mine that I'm all Greek. And there's no question that my Greek heritage is a big part of who I am. And people certainly understand that with a surname like Carayiannis. But my father was born in Greece and my mother was born in Ireland. She has 4 sisters there, my aunts, and their uncle and their husbands, and my uncles. And my cousins are all— my first cousins on the Irish side, all— a few of them live in England, the rest of them all live in Ireland. And I'm in contact with my Irish family, if not weekly, several times a month. Even during the pandemic, we've spent a lot of time in touch on Zooms and FaceTimes and things like that.

33But yeah, I have a— and I'm very proud of my Irish heritage. But I will say that I sometimes have to— I have to make sure that it's known because people make that assumption about my background.

35That's interesting. It probably doesn't. I don't know. I articled at the firm that's now just referred to as Gowling's. At the time that I articled and when I first started there was Gowling, Strathy& Henderson. Shortly after that became Gowling Lafleur Henderson when they did the Smith Lyons merger and the Lafleur Brown merger. And then I think now they just, everybody just calls them Gowlings.

37I have no idea how they let me in. Honestly, I was very fortunate to get a chance at Gowling's. The time that I was applying for an articling position was— I can never really remember what it's like now. For those in the Canadian system, they'd understand that. Anybody outside of Canada, after we go to law school, we have to do effectively a year as an apprenticeship, and it's called articling here. And you apply for that at least a year in advance of finishing school. So, you know, I was not a conventional applicant to a Bay Street white shoe firm like any of them. I did go to Osgoode Hall, but really my J.D. was from Michigan State.

38And in fact, at the time, I had a JD and everybody else had an LLB. And I had to answer that question at every single interview. What's a JD? What's a JD? What's a JD? It was a few years later, as so many U of T grads and McGill grads were going to New York and Boston, that they petitioned their schools to change the LLB to a JD so that they didn't have to answer what's an LLB question when they were interviewing in New York. But yeah, I went to Michigan State, I had a JD, I had this interesting, unusual background for most applicants, and I think we can probably safely say that there aren't a lot of Greeks on Bay Street, and while there are far more now, there weren't that many in the '90s, and I think that's just a I think that's just a demographic fact.

39So I think they took a chance on me. I'm not sure how I got in, but I felt very grateful to, to be given an interview. I can tell you that I sent way more applications to firms than I got interviews. In fact, the ratio was about 10 to 1. I paid for a lot of postage at the time. You know, we had to do them all manually and stick them in the mail. And I got a lot of short one-paragraph letters in response. And Gowling's was one of the ones that was kind enough to take a chance and let me come in on the interview process. And a few people there really, I think they took me under their wing.

40And for that, I'll be forever grateful. I still keep in touch with some of those people. And I'd say thanks to them as well. So I don't know, it was a happy accident. I was a fluke.

42Yeah,

44Well, you know, I think, I think there were a few things that were happening. You know, Gowling's, I have to give credit to them in so many respects. You know, they've, as, as these things go, they've got a lot of people that have been very progressive and very innovative in the legal space. I think back to the '90s and the mortgage enforcement machine that Gowling's and principally Mark Tamminga, with other people around him, but I think it's probably fair to say we should give credit to Mark for spearheading that initiative. But it was truly modern, new work in the mid-'90s to create an entirely automated legal process from start to finish. And, you know, now it probably seems pretty boring and old-fashioned to have a mortgage enforcement practice attached to a law firm that's part of a bank or that works with a bank and then have it mostly automated.

45But I can tell you that in the mid-'90s, that was not considered a normal approach. Approach to the practice. And that's one big example, but I think Gowling's probably, I could probably think of a few more examples where there were individuals at Gowling's, there were lawyers at Gowling's that are willing to try something new, they were willing to try an alternative. And, you know, they wouldn't have been in the majority, but I think that's normal for any large law firm. And if we were to look at the bell curve of early adopters to laggards, I think the same bell curve would apply to Gowling's, but there was definitely a group of early adopters who were open to the conversation, who were willing to look at new ways of practicing, who thought that we could make a difference and practice in a different way.

46And those people were, you know, if not supported, at least tolerated, and the conversation wasn't shut down. So I think at an early age, I was probably attracted to the idea. I know that very early on I realized that the billable hour was, you know, there really ultimately are no redeeming features to practicing law with the billable hour. I know that it's the mainstream, and I know that I'll probably be arguing about this until well after I finish my career. And I know that it's like I'm tilting at windmills, but it's just an awful way to live. It's an awful way to work. It's an awful way to deal with your clients. And on that, I stand firm.

47But I recognized that very early. And even though I was really steeped in that billable hour culture like any other young associate in a big law firm, I realized that there had to be a different way. And that is what started to put me on the road to ultimately creating and building Conduit Law. I left— when I left Gowling's in 2004, I left with an idea in mind, which was that I had this— I had a nice little practice already developing, and Gowling's was very, very encouraging of my, of my business development initiatives and my entrepreneurial initiatives. There was a— there were a few partners in particular who actively supported me and actively engaged with me to help me build up some clients.

48But there were some of them that I realized could use a general counsel, could use an in-house lawyer, but they didn't need a full-time lawyer. They didn't need a 5-day-a-week, 52-week-a-year in-house counsel, but they could use somebody 1 day a week or 2 days a week. And I originally got that inspiration from CAs. I learned about this idea of, of CFOs for hire. Who were sort of aggregating a small portfolio of companies that could not individually have a CFO but needed a CFO. And I thought, well, if we can have CFOs for hire, why not do GCs?

50Why not do GCs? We'll have a general counsel for hire. And and I had a few clients that I thought—

52That's the core of our business, and that's probably what we're most well known for. The embedded in-house counsel or the fractional general counsel, the fractional lawyer, this concept of somebody working embedded on-site, on-demand with clients for a fixed fee. I think that's— if I created a bullseye, a dartboard, That's the bullseye of Conduit Law Services.

54Yes. So that was— and what I was doing there, and I didn't know Pulat at the time, I didn't understand it, but I actually was prototyping Conduit Law, but accidentally doing it.

56Absolutely. I would agree with that completely.

58I've been waging— so, well, I would say I've been formal war since 2012 when I started Conduit Law and I raised the flag and declared a formal war on the billable hour. But from 2004, when I left Gowling's, to 2012, '11, I would characterize that as a guerrilla war.

60Well, so the short answer is anything other than the billable hour, really. Here's my view, and I'd be happy to debate this with anybody. I don't think— clients don't buy time. It's as simple as that. Clients don't walk into your office, they don't walk into my office, they don't pick up the phone and say, I want an hour of your time. I want to buy an hour of your time. Clients have problems that need solutions. If they're calling a lawyer, it's because they've got a legal-shaped solution. Not a plumbing-shaped solution or an electrical-shaped solution or a cardiac-shaped problem looking for a solution, right? You call the plumber, the electrician, the doctor, the lawyer based on the problem that you're experiencing and where they want a solution to that problem.

61The amount of time that you expend on giving them that solution is entirely irrelevant. It's as though you go to a restaurant and after ordering your meal, which says on the menu it's $19.95 for whatever, chicken something, steak, pick whatever, it doesn't matter. It's as though then the chef would come out and say to you, the meat was a little hard. And I had to work harder to make it more tender for you. We actually marinated that meat longer, and so I know I said it was $19.95, but today I have to charge you $22.95 because I had to work harder on that, right? It's as though, you know, we've all been on a flight where we've taken off from our city of departure to arrive in the destination, and we've all been late in the destination while we've flown in a circle over the airport for whatever reason.

62It could be thunderstorms, it could be snow, it could be fog, it could be traffic. Everybody who's flown into JFK or LaGuardia, particularly in July or August, has had this experience. And so your flight is delayed by an extra 20 minutes or 25 minutes or an hour before you actually land. And then the pilot would come to the front of the plane and say, I know you already paid for your ticket, but it took us longer to get here, and I had to really work hard on the landing because, you know, it was foggy. So I'm gonna have to charge you a little bit more. That is ultimately what the billable hour says. The billable hour, you know, and I learned this from another gentleman, the billable hour is about inputs, but the clients don't care about inputs.

63The clients care about outputs. Now, I am not saying that how long it takes you to complete a task a legal task is irrelevant. Of course it's relevant. It's relevant to your day. It's relevant to your schedule. It's relevant to your staffing decisions. It's relevant to the resources you need. It is not irrelevant. It is relevant. But as a billing mechanism, it is a very, very poor proxy for the actual value that you deliver to your client. And in point of fact, when you use the billable hour, you only hit the value accidentally. You will either undervalue your services and leave money on the table, or you will overvalue your services and rip off your client, but you will never hit the button.

65I should check it out again.

70So I think it's a great question. And, and, and this is why this even this entire subject is very compelling and why I mean, after at least 15, 16 years of having this dominate my professional work, it still remains compelling to me. I think there's two things that I'd want to talk about. First of all, we do need to talk about inputs, but we also have to have a proper discussion about what the inputs are if we're going to have that discussion. And let's park that for a moment. But the liberation from time can be a number of different things. And we've experienced this now through the pandemic, particularly for white-collar knowledge-based workers who've all decamped from the office to come home and work from home, underlining the point of place.

71But clients come to us for solutions. Broadly speaking, I think that that falls into 3 categories. What's the solution? They come to us because of our knowledge, our background and our knowledge, what we've learned, the books, the black letter law. They come to us for our experience, the amount of time that we've been doing work and how we are able to marshal resources to solve that problem. And then I think the third thing that they come to us for is judgment. And I've never really been able to properly define judgment in the context of legal services, but I often put the three of them together and put it into some kind of a mélange.

72But none of those are dependent on working 9 to 5. None of those are dependent on working a specific timeframe inside the day. Yes, if you've got to file a document with the court, obviously, you must conform to their schedule. In that case, you're neither liberated from time nor place because you need to show up at the courthouse at a certain time to deliver a document. But the solution around that, the factum that you write, or the contract that you write, or the solution that you put together, that can be put together at 2 o'clock in the morning as easily as it's put together at 2 o'clock in the afternoon. And that's entirely dependent on when you are ready to do the work, when you are capable of doing the work, when you are able to interact with clients and witnesses and stakeholders and opposing counsel.

73All of those things come in together, but none of it has to happen in that particular timeframe. And I think that's really what I'm talking about. It always struck me as kind of odd, you know, going to the big law firms When you look at the types of candidates that law schools select for and the type of candidates that law firms select for in the sort of the larger hiring process, you know, they tend to be high academic achievers. They tend to have powerful resumes with a lot of interesting experience, and they're hired for all of that. But what the billable hour says is, take all of that and now chain yourself to a desk during these business hours.

74And I just think that when you're delivering legal services, it's just not that mechanical. It is not that clerical. There are things that we can automate. There is certainly technology that we can bring to bear. But when you look at that triumvirate of knowledge, experience, and judgment that's brought together, that is not time-dependent.

77But if we explore the time, the actual time concept itself, then we also— the question is, is what time are we paying for? So I often would trot out the example of And I don't practice tax law, which is what gives me license to use a tax example. But, you know, you can imagine a scenario where there is a discrepancy, that there's a problem with the tax authorities. Client comes to you with that problem. You know, you can imagine a scenario where you have a 5th-year associate, reasonably competent, reasonable amount of experience. But let's just say at the beginning of their career still. And then a 25-year partner with the— confronted with the same problem, the same issue, the same price tag, the same amount of money at risk.

78Okay, so they go to the young associate and the young associate starts spooling up the research machine, right, and spending time to come to a conclusion. The 25-year partner may already have the solution in their head because they've confronted this before. Their experience line is significantly longer than the experience line of the 5-year associate. Consequently, the length of that experience line informs their judgment line. And I use this as a magical example. I'm sure this never happens in real life. But in 1 hour, that tax partner with 25 years experience able to draft a perfect letter responding to the tax authority, solving the problem. So the associate spent— let's just give it a number.

79Let's just say the associate spent 20 hours solving the problem and came to the same conclusion. And the partner spent 1 hour solving the problem, coming to the same conclusion, giving the client the same result? How do we charge that person? And what's the input? Is the input just the 20 hours that the associate spent that week, or the 1 hour that the partner spent that week? Or is the input a 25-year career that funnels off over the horizon? What is the input? What's the right number? And let's take it a little further. Let's assume it's, it's the interpretation of a part of the tax code Code, and you have Client A comes to the firm, and Client A is a mom-and-pop small business.

80And the problem with their interpretation of that part of the act is this big, OK, because their business is this big, and their revenue is this big, and consequently, the tax problem is this big. And on the same day, a global multinational company comes to you and has the exact same problem with the exact same interpretation of the same provision of the Tax Act, but their problem is this big. So we've spent 1 hour solving the problem or 20 hours solving the problem. In the hands of one client, that might be a— a $10,000 problem. In the hands of the other client, it might be a $10 million problem. And while most of this story is entirely fabricated, I think we can agree that, you know, when global multinationals have tax problems, it's in the millions of dollars.

81And when mom-and-pop businesses have tax problems, it can be significantly less. So what's the value proposition? Yeah. In solving that problem? Well, it's always going to be in— the value will be determined in the eyes of the client. But when you come at it with the billable hour, the value, the first base point for determining the value is in the eyes of the effort expended by the lawyer. And even in my example, you've got two different— so two, two equal solutions, but delivered by two different lawyers, where the effort is different, at least in terms of billable hours. And so the input is different.

83Yeah, well, don't think that the irony isn't lost on me that somebody who rails against the billable hour and tracking your day in 6-minute increments goes off and starts a watch company. That has been brought to my attention and I embrace that irony. But you know, that's me having a foot in two camps, right? We can have two different ideas at the same time. I started So I started Mission Watch Company together with my partner Aaron Solomon, and we started this— pardon me for that beeping interruption— we started this business in, I guess, 2018. And really it was an opportunity. It was almost a professional palate cleanser. It was an opportunity to do something different.

84It was an opportunity to get away from services. Your intuition on this is 100% accurate. It was an opportunity to look at, look at the how we could provide something valuable, but that people would like and hopefully buy and create a marketplace for or step into a marketplace where we could sell our goods, but actually selling a good. And the idea of going through the creative process of coming up with the Mission Watch Company and then coming up with our product and, you know, literally taking out pads of paper and trying to design this thing on a blank sheet. And let's be very clear, neither of us are industrial designers. So a lot of that was, you know, fairly remedial, I can say, at the beginning in terms of what our designs started looked like at the beginning.

85But then we went through an educational process, and, and a lot of that was informed by my legal background, how to start a company. I've been advising entrepreneurs basically since the beginning of my career, and, and then it sort of took on a life of its own, if I can put it that way.

87No, I don't think there are any echoes of professional services. So, you know, we are subject to market pricing, we're subject to market conditions. The watches are designed in Canada, but the parts are sourced on a global basis. So we have had to dip our toe into the global marketplace for goods. Obviously we're a tiny company, but we're still part of that massive supply chain. Consequently, even at a very small level, Mission Watch Company has had to deal with the pandemic. We're slightly delayed. The Mission— our third watch is coming out. In fact, this morning, I can say that we received the confirmation. We should expect delivery should be the first week of April, give or take.

88But that's been slightly delayed, and part of that delay has been a cause of the disruption in the supply chain on a global basis. We've— pricing has been very, very interesting and dynamic, looking at the marketplace for automatic watches versus the marketplace for quartz watches. Our first watch was an automatic watch. It's at a higher price point. Our second watch is a quartz at an entirely different price point and also able to be marketed to a different, a different consumer. It's been very interesting. And, you know, you know, one of the interesting things, at least where there's a little bit of overlap between designing and manufacturing and selling watches and the legal industry is Both of them are very old professions.

89They've been around for a very, very long time. And in some respects are very constrained by tradition. I mean, people do make some pretty absurd looking watches, but basically we're luck— we're stuck with a single form, you know, a round watch face with markers for 12 hours, whether those are numerals or indices is kind of up to you. But then there's this creative process of how can you come up with something that is authentic and has some originality to it and is true to your vision, but ensure that it's not a copy of anybody else's, and yet still be stuck inside that paradigm of a wristwatch. It's a fascinating challenge. And it's a fascinating problem to solve.

91Well, thank you very much. Spasibo.