A group of female entrepreneurs in the legal market has told general counsel that they have to support female-run start-up businesses if they are to survive the impact of the Covid-19 pandemic.
An open letter signed by 28 founders of legal businesses – including alternative legal services providers, technology pioneers and others – said female-founded businesses were more likely to suffer as a result of the crisis, risking the diversity of the market.
The letter was sent to all General Counsel for Diversity and Inclusion, a group of 100 GCs at leading companies who have signed a pledge to act as advocates for diversity and inclusion.
It was organised by Dana Denis-Smith, founder of flexible legal services provider Obelisk Support – which mainly using female lawyers returning to work after having children – whose research earlier this year found that women-only founders raised just under 1% of the overall investment into the legal sector.
The letter said: “A snap poll of female founders running legal services businesses carried out since the lockdown started shows that in the space of only a few weeks, 39% have seen sales drop considerably and for 21% funding is now even harder to come by.
“With the third most commonly reported pressure being the added strain of childcare (13%) falling disproportionately on women, the perfect storm is here.”
It said there was a “real danger” that start-up ‘New Law’ businesses like these “just won’t survive”.
“In tough times, with budget cuts and extra scrutiny on spend, commitments to diversity and inclusion are all too easily forgotten and smaller, more innovative suppliers can be swept aside.
“There is a temptation for in-house counsel to turn to traditional suppliers that are perceived as less risky despite being shown to be less cost effective in the long run.”
The letter urged GCs to think about the long term as they looked at their supplier relationships.
“Our concern is that female entrepreneurs who were already facing poor odds due to the structural inequalities prevalent amongst the investment community and lower access to corporate spend (less than 5% of corporate spend is with women-owned businesses), will struggle to survive and thrive.
“Unlike larger firms, most do not have the ability to access capital arrangements with banks that would help to see them through if their sales funnel dries up and they do not have investor backing to champion them or co-finance any support.”
The letter warned that, without collective action, the result would be a “less diverse, less vibrant market”.
It finished: “On behalf of all women who have together contributed to an emerging ecosystem of alternative legal services companies, we ask that when reviewing budgets and making procurement decisions in the coming weeks and months, you consider the long-term benefits of maintaining greater competition, innovation and supplier diversity in the sector.”
The other signatories to the letter were:
Rachel Amos, Senate
Mandy Aulak, Talem Law
Christina Blomkvist, Green Counsel
Mary Bonsor, F-lex
Helen Burness, Saltmarsh
Vanessa Challess, Tiger Law
Susan Cooper, Accutrainee
Vandana Dhamija, Legal Operations Consulting
Helen Goldberg, Legal Edge
Lori Gonzalez, Rayna Corp
Silvia Hodges Silverstein, Buying Legal Council
Sara Hutton, Consultsh
Kerry Jack, Black Letter Communications
Kaisa Kromhof , Contract Mill
Catherine Krow, Digitory Legal
Chrissie Lightfoot, Entrepreneur Lawyer
Karin McKercher, Twenty2 Group
Victoria Moffatt, Lex Rex Communications
Denise Nurse and Janvi Patel, Halebury
Emma Reid, Ergo Law
Maaike Roet, House of Lawyers
Jo Rogers, Navistar Legal
Janet Taylor Hall, Cognia Law
Pip Wilson, Amicable
Samantha Woodham, The Divorce Surgery