Firms go all in on AI — but overlook the tech that ties it all together
While firms race to integrate AI, many are overlooking the foundational technology that could drive efficiency and profitability, Clio finds in its latest Legal Trends for Mid-Sized Law Firms report
Clio’s 2025 Legal Trends for Mid-Sized Law Firms report has uncovered a seismic shift in how firms operate.
- AI adoption among mid-sized firms has skyrocketed to 93%, with over half using AI widely or universally
- Despite investing nearly double the industry average in software, only 38% of mid-sized firms are using legal practice management software
- Mid-sized firms are leading the shift toward predictable pricing, with 64% offering flat fees and 27% adopting subscription models.
AI adoption has surged from 19% to 93% in just one year, transforming how legal professionals work. At the same time, mid-sized firms are leveraging more billing strategies, charging higher rates and embracing fixed fees to meet client demand for predictable pricing. Yet, while firms race to integrate AI, many are overlooking the foundational technology — cloud-based legal practice management software — that could drive efficiency and profitability. As firms navigate economic pressures and rising client expectations, this report provides a critical look at the future of legal practice.
AI adoption soars among mid-sized law firms
The rapid adoption of AI stands out as one of the most striking trends in this year’s report, with 93% of mid-sized and sole practitioners now incorporating AI into their operations — over half of them adopting it widely or universally. Not only are mid-sized firms significantly more likely to have embraced AI than smaller firms, but their adoption is also more comprehensive. While 72% of smaller firms are using AI in some capacity, only 10% have adopted it extensively, highlighting a significant gap in technology utilisation.
The push for AI adoption is driven by the need to save time, increase efficiency and improve the quality of work. Legal professionals at mid-sized firms identify the top benefits of AI as enhancing efficiency (43%), improving work quality (38%), and managing caseloads more effectively (37%). Popular AI tools include AI-powered legal research (66%), generic non-legal AI tools (65%), and document automation (60%), which are proving instrumental in enhancing productivity and client engagement.
Looking ahead, more than 80% of legal professionals anticipate AI usage will continue to grow over the next 12 months, suggesting that firms that fail to adopt AI may soon find themselves at a competitive disadvantage.
Mid-sized law firms are leading the way in billing strategies and pricing models
For the first time, Clio’s 2025 Legal Trends for Mid-Sized Law Firms report breaks down hourly rates by firm size — uncovering striking differences in how mid-sized and smaller firms price their services. 99% of mid-sized firms use multiple billing rates for their lawyers, compared to just 85% of smaller firms. On average, mid-sized firms apply eight different hourly rates for lawyers and nine for other legal professionals, while smaller firms rely on just three.
This pricing flexibility gives mid-sized firms a competitive edge, allowing them to tailor services to client needs and maximise revenue. Mid-sized firms are also charging higher rates with greater variability. This signals a more sophisticated, revenue-driven approach to billing that could reshape industry pricing standards.
Embracing fixed fees as clients demand predictable pricing
As client expectations evolve, mid-sized firms are responding by moving away from traditional hourly billing models. Instead, they are increasingly offering fixed fees and subscription-based pricing structures, which provide greater transparency and predictability. With 64% of mid-sized firms now offering flat fees and 27% adopting subscription models, the emphasis on pricing clarity continues to grow.
Additionally, 82% of firms that offer fixed fees apply them to entire matters, while 41% use them for specific activities within a matter. As more clients seek predictable pricing over traditional hourly rates, mid-sized firms are adapting their billing practices to meet these expectations, establishing themselves as forward-thinking, client-centered businesses.
Marketing tools drive revenue and efficiency gains
Mid-sized firms are making substantial investments in software, dedicating 2% of their expenses to technology. Popular solutions include cloud-based storage, video conferencing, e-signatures, online payments, accounting software and cloud-based practice management software. However, despite this commitment to modern tools, only 38% of mid-sized firms are utilising legal practice management software, significantly trailing behind the 71% adoption rate seen among smaller firms.
This gap highlights a disconnect: mid-sized firms are investing in technology but overlooking the efficiency gains of a unified practice management solution. They’re buying the pieces but ignoring the puzzle.
Clio’s commitment to mid-sized firms
Clio remains dedicated to empowering mid-sized firms through tailored technology solutions that drive productivity and profitability. With over 1,000 mid-sized firms relying on Clio’s technology, the company continues to strengthen its presence within this segment.
Since 2016, Clio’s data-backed reports have provided invaluable insights to legal professionals, guiding firms toward making more informed decisions in an increasingly complex industry landscape. The 2025 Legal Trends Report for Mid-Sized Law Firms draws from anonymised data from tens of thousands of legal professionals, offering a comprehensive view of industry trends and opportunities.
Download the full report at clio.com/uk/guides/2025-mid-sized-law-firms-report/
