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Making divorce cheaper, more friendly... and better for the kids

wevorce.com ·

  • ~50% cheaper than the average divorce
  • 99% success rate of keeping clients out of court

san francisco ca
The Elevator Pitch Wevorce is a startup that uses software to help couples go through divorce in an amicable way. Navigating the legal and often psychological battle in a friendlier way may free some Americans from the divorce culture, but the startup needs to penetrate a community of early adopters in the law community before it can scale.

Staff Pick

by Boonsri Dickonson, Wefunder Correspondent, February 12 2013

Wevorce founder Michelle Crosby knows the pain of divorce all too well. At the age of nine, her parents were going through a bitter court battle. When she took the witness stand, the judge asked her: “Which parent will you choose?”

"When you are nine, you can't answer those questions," Michelle says.

She felt confused and overwhelmed. They were asking her to pick which one was her favorite parent, and she didn’t know how to answer.

At the time, divorce settlements meant mom got the kids and dad had to live with seeing them every other weekend. That wasn’t enough for Michelle’s father, so he challenged it. Unfortunately, because of the way the divorce process generally works, this meant that Michelle was dragged to court every other year.

The post traumatic stress from experiencing such a bitter divorce, stayed with her and wound up influencing her career choice. Michelle attended Gonzaga University of Law in order to pursue family law so she could help make sure other children didn’t have to go through a similar traumatic experience.

The divorce process is broken

Throughout her studies and practice, she started to understand why so many divorces wind up like her parent's one did. When partners decide to divorce, two different lawyers are hired who work towards ensuring that the partner they represent walks away with as many of the family’s possessions as possible, including the kids.

“Law schools train lawyers to be advocates. Lawyers sit with their clients and are taught to think about the process from that one client’s perspective,” Michelle said. “They fail to recognize there’s a whole family involved or how divorce sets the stage for co-parenting. That’s a rough way to begin a change especially when this is your family.”

Michelle couldn’t bring herself to practice family law in that way, so she joined a corporate securities firm instead. After years at that firm and on the eve of a coveted partner promotion, Michelle realized that she had drifted even further away from the reason she went to law school in the first place.

So she quit and decided to start her own family law practice that would change the divorce process in the way that she had always understood was needed.

"I wanted to go work with families," Michelle said, “and help them through tough times to make decisions for their families. The transition during a divorce maybe from the husband and wife role, but there's no reason couples can't maintain the mom and dad role for life,” she added.

Divorce impacts millions of families

To say that many families could benefit from an improved divorce process would be an understatement. According to the CDC, nearly half of all marriages end in divorce. The chance of staying together in a second or third marriage is even less likely, and children are directly impacted by the change. The Effects of Divorce On America found that fifty percent of children born to married parents will experience divorce before they are 18-years-old. And various studies have shown that children who experience the divorce of their parents require psychological help.

Second to the death of a spouse or child, divorce is the most traumatizing life event that one can experience, so grieving through the process is expected. Michelle experienced this grief first-hand. After being married for 13 years, she went through an amicable divorce with her husband using her own methodology. Seemingly trapped in the divorce system herself, her only escape has been through creating a new way to get divorced -- one that is augmented by software and prioritizes empathy for the children involved.

"I've walked the shoes of every role -- the child of a divorce, a wife who was divorced, and a lawyer helping other people get divorced," Michelle said.

How Wevorce works

There are stumbling blocks that all families encounter, so Wevorce can recognize those patterns and normalize them. The Wevorce process starts from a different place than a traditional divorce. Instead of two lawyers competing against one another, Wevorce puts one lawyer at the center whose job it is to help the family find the best way to co parent moving forward. There are six steps to the process : Amicable divorce planning, sustainable co-parenting planning, partnering agreement, financial mapping, financial agreements, and divorce settlement.

Each step involves a meeting with the attorney and an accompanying software component.

"The idea of combining technology in this conversation is really new. Using technology to make the professional’s job easier is the key. It allows them to save costs and do away with paper files," Michelle said.

Family attorneys wind up doing a lot of paperwork, a reality that is cumbersome for them, and expensive for their clients. Wevorce has developed software that helps attorneys complete that paperwork in 60 percent of the time that it normally takes. Clients can answer questions using a tablet while meeting with the attorney and complete other components of the process on their computers at home.

In addition to walking the couple through the legal process, the software gives couples helpful information about the complexity of what they are going through. For instance, there’s a video that explains how the brain’s amygdala region, where emotions are stored, is affected during a divorce. When someone is going through a divorce it is impossible to make a logical decision. The video shows parents that when they experience an emotional trigger, they can have a rush of adrenaline that lasts for hours. To relieve this, the video suggests that they go for a walk in order to calm down and get back to making logical decisions.

Companies such as LegalZoom have provided online paperwork that is standard in divorce settlements. However, people have a hard time navigating hundreds of pages of legal documents, “Even if you choose do-it-yourself methods, they are dealing with 170 pages of double sided documents that use jargin like “pro rata” and “jurisdiction” that the average family has a hard time understanding.” Michelle said. "We populate those legal documents and we are doing it in a much more human fashion."

Wevorce is already having success. While living in Idaho, Michelle ran a beta test. She put 104 families through the system and only one went to court.

“If this could work in Idaho, this could work anywhere,” Michelle said. The service will soon be available in San Francisco, California, Seattle, Washington, Boise, Idaho, and Asheville, North Carolina.

In just two years, the system has saved clients $2.5 million in legal fees. In January, Michelle moved from Boise, Idaho to Mountain View, California to join a prestigious incubator program called Y Combinator to further develop the software powering Wevorce with her co-founder Jeff Reynolds.

Jeff Reynolds joins the team

Michelle was speaking at an Ignite conference, where Jeff happened to be one of the organizers. Jeff joined as co-founder and COO after a mutual friend suggested they meet for coffee. Jeff’s parents had also gone through a divorce when he was a child, so felt a personal drive to make the divorce process better.

“If my parents had had this, I wouldn’t have spent 20 years worrying about them bumping into each other. Or stressed out about thinking about the transition between my mom and dad’s house,” Jeff said. “My parents didn’t know how that would impact their kids and how it would impact future relationships. They were focused on getting out of each other’s sight. But it turns out, that’s not really a healthy approach to build a future on.”

Jeff brings a history of entrepreneurial experience to the team. He has founded or grown with companies, and is building on that experience to bring Wevorce to a number of new locations.

Why attorneys like Wevorce

Michelle and Jeff hope that a group of lawyers that are already working to keep families out of court will be their early adopters. The collaborative law movement began in the 80s, and has since spread across the country. Lawyers in this movement practice with the thought that families should work on separating without ending up in court or losing sleep from the threat of contested litigation. The challenge has been finding a revenue model to support their work, and Wevorce seems to be a fit. The faster lawyers can help families through the divorce process, the more clients they can manage. There is a list of 15 attorneys in 6 different cities waiting to join Wevorce.

Like most startups, Wevorce is testing different pricing models, but currently averages around $6,500 a client. The average family spends $27,000 on divorce, so Wevorce costs less than a third of what they would otherwise expect to pay. Families call Wevorce to book an appointment. The couple schedules a meeting with an attorney mediator for a consultation where the couple gets the same information together rather than each partner coming to the table with different ideas from their respective attorneys. Delivering the information this way, Michelle said, builds trust.

The trust built through their process helps Wevorce get clients to a resolution relatively quickly, but they often want to expedite the process.

“I always try to say, how long did you spend planning your Wedding? When you are uncoupling, it takes time for everyone to adjust, including the children," Michelle said.

The fastest couples go through the Wevorce process in 6 weeks, but on average, it takes 90 days. The National Center for Health Statistics estimates the average length of divorce proceedings to take 1 year.

Meet the Founders

Michelle Crosby
Founder and CEO

What People Say

Breaking Up Is Hard To Do; Wevorce Aims to Make It Easier
July 5, 2013
Michelle Crosby, co-founder and CEO of divorce mediation start-up Wevorce, knew what she wanted to do when she was nine. Six years into an epic custody battle, one of her parents’ lawyers put her on the stand and asked her which parent she would want to be with on a desert island. “At nine, you can’t answer that question, and you shouldn’t have to,” she says. “At nine, I knew this space was broken.”
Wevorce, the YC startup that makes divorce suck less, opens to all
May 22, 2013
Besides making the divorce process more understandable and speedy, the company also claims to make it cheaper. Wevorce says its set fees range from $3,500 to $15,000. The company says the average case costs less than $10,000 while traditional divorces can cost upward of $27,000.

Questions & Answers

WF: Why did you start this company?

Because the world needs it. Michelle was a practicing attorney who heard over and over again that attorneys were not—could not—be in the business of settlement. She set to work to find a better way. Wevorce is the better way: for kids, couples and divorce professionals.

WF: How many families have you helped?

105, with several more waiting to get started.

WF: What are your margins?

Gross margin ranges from 40% to 50% depending on the product, location, etc. While at our core we are about making life better for kids, we know this can’t happen without a sustainable business model. There have been other movements that tried and failed because they cost too much or didn’t allow practitioners to earn a good wage. Our technology-meets-humanity approach fixes that.

WF: Is this a services business?

It’s a hybrid. By using specially trained mediators to facilitate our process in-person and online, we’re able to provide the personal touch families need during this process. But we couldn’t scale it without our cloud-based software and education tools, which allow the families to do much more of the work themselves.

WF: How do the costs compare to a traditional divorce process?

We’re normally 1/3 the price of a two-attorney divorce and about the same price as unstructured mediation. Compared to both, we provide much more value to the families in the form of education, tools and sustainable parenting plans. Most notably, instead of working with just one, legally-focused professional, you also get the help of parenting and financial experts.

WF: How will you find customers?

We’re finding them and they’re finding us! Everyone recognizes that the existing divorce machine is broken and couples are looking for better options. We want to be at the center of that conversation. We’re accomplishing this by building a strong professional referral network in the cities where our physical locations are based, developing relevant content for publications, blogs and SEO, and strategically using targeted SEM to stay in front of this information-starved audience.

WF: How will you find attorneys?

Well, not all of our mediators—we call them Divorce Architects—are attorneys, though most are, simply because they have the legal training to help families untangle even the most complicated situation. These professionals have been waiting for technology and content like ours. In fact, we have a waiting list of professionals in every city we’ve rolled out in.

In many ways, we’re creating a new career track for the thousands of would-be attorneys who come out of law school with no job and no desire for following the traditional law firm career track.

WF: How will you expand such a high touch business?

It wouldn’t be possible without our back-end technology. It seems ironic, but the technology actually enables us infuse more touch and even humanity into the experience. Our system frees the Divorce Architects to put 95% of their energy into understanding their clients’ issues, not shuffling papers.

With such a systemized approach, we also eliminate the need for support staff, meaning that our revenue-per-employee remain at attractive levels.

WF: How big is the market?

$16 billion per year is spent on divorce legal fees alone. And that’s just a fraction of the total cost of divorce when moving expenses, counseling services, etc. are included.

Eventually, we think we can help our clients solve the many challenges that surround this transition.

WF: How fast can you reasonably expand?

We plan on opening 25 locations in 15 states by the end of 2013. Because we work with clients virtually as well as in-person, we expect our client growth to accelerate even faster.

WF: How do you manage such a large workforce of consultants?

Because our Divorce Architects are all highly educated,highly trained professionals, their self management capabilities are exceptional. And when we give these talented people access our custom case management software, it helps them work even more effectively.

WF: Do you bring attorneys clients or do attorneys bring them to you?

Because our Divorce Architects are experienced professionals, they almost universally have a strong referral network that attracts clients based on their reputation. This helps us grow our client base quickly when we enter a new city. That said, this is far from our only source of clients. Our clients come from referrals, publicity, search engine marketing and more.

WF: Who owns the client?

All of our clients are Wevorce clients. Our “Divorce Architects” are either employees or contract employees.

WF: Do family attorneys see you as competition?

Most family law attorneys are thrilled about our work. They realize the flaws in the system and, in many cases want to be part of fixing it. That explains why in some areas, like Seattle, we actually have a waiting list of professionals—many which are currently practicing family law attorneys—who want to become Wevorce mediators.

WF: Do you have any competitors?

It’s a very diffuse market, with lots of different types of attorneys, mediators and even “divorce coaches” servicing it to varying degrees. In one sense, these are all competitors, but in another none of them are trying to achieve what we’re trying to do: take the confusion out of getting divorced amicably. Right now, most folks have no idea how to do it. We want to be the answer they’ve been looking for.

WF: How is this defensible/why can’t lawyers just replicate your process?

We’ve been refining our methodology for nearly two years. It took that long because every family situation—while similar—has many unique characteristics that we needed to integrate into our system. Could someone do this development faster? Possibly. But it is still going to take many months to get it even close to right.

Attorneys are trained to be experts in the law. They do a great job at that. Unfortunately, while divorce has legal implications, it is the emotional and financial elements that normally send people for a loop. We’re dedicated to finding solutions for all three of these elements.

WF: What keeps you up at night?

Several things. First and foremost is the challenge of expanding quickly while maintain an amazingly high quality experience for the families we serve. We consider it an honor to work with our clients and we take our commitment to them seriously. Still, we are driven to grow quickly. Every day a child is dragged through a courtroom or in some other way torn apart by the existing divorce machine is one day too many. Contrary to popular belief, the most damaging part of this experience for kids is not the divorce itself, but how their parents handle the process. We lose a lot of sleeping worry about that.

WF: If you achieve your vision what will Wevorce look like?

Our vision is massively improved relationships—and therefore improved lives—for thousands of kids and their parents. To achieve this in the way we hope, we’ll need a solid presence in every state both brick-and-mortar and online. We also see ourselves at the heart of a very large and very important national (if not global) conversation on improving how we address major life events from a legal perspective and how we can make the law more responsive to human needs.

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