An online lawyer-matching business targeted at companies has secured £3.4m in its latest funding round with an investor predicting that it could become “a virtual and distributed tech-driven global law firm”.
Lexoo’s series A financing round was led by Earlybird, a venture capital investor focused on European technology companies, with participation of existing investor Forward Partners and Ned Staple, general counsel at Zoopla Property Group, amongst others.
Lexoo will use the funding to invest in new technology, including automated contract drafting and project management tools to further increase efficiencies of its lawyers.
The company also plans to expand its headcount to 45 employees internationally by 2020.
Lexoo allows in-house lawyers to identify boutique firms from its network. Clients compare and hire lawyers who bid on a fixed-fee basis for their work.
Fabian Heilemann, a partner at Earlybird who will be joining the company’s board, said: “Lexoo has the perfect combination of tech expertise and legal industry background needed to take on the B2B big law market.
“We love their vision and believe they have the potential to evolve from a marketplace into a virtual and distributed tech-driven global law firm.”
Mr Staple added: “I was struck by how Daniel and his team understood the need to grow supply and demand in unison, which is critical to building successful platform businesses and generating network effects.
“There’s undoubtedly a structural shift going on in the legal sector, with both lawyers and their clients wanting greater flexibility and more efficiency.
“Indeed the number of deals and volume of money going into innovative businesses in the sector shows that significant change is already well underway.”
Lexoo says its lawyers are “algorithmically matched to the client and the job spec, eliminating the stress typically associated with finding and instructing an appropriate lawyer”. Lexoo’s team monitors and assists when necessary.
The site now has over 800 vetted lawyers on its marketplace, with Lexoo saying it accepts less than 15% of applicants.
The lawyers are typically former big firm lawyers who now work independently or for boutique firms, and together they cover 55 countries.
The company said that, since launch in 2014, over 3,000 multinational companies, large corporates and high-growth startups have engaged Lexoo lawyers.
They include UBS Asset Management, Travelodge, eBay, Ascential, VICE Media, Ocado, Monzo, Just Eat, Babylon Health, Secret Escapes, WorldRemit and ASOS.
Lexoo said it was also on the legal panel of numerous FTSE 250 firms.
Dutch lawyer Daniel van Binsbergen, co-founder and CEO of Lexoo, said: “The traditional global law firm is a flawed delivery mechanism. The large dominant firms bill by the hour and are incentivised to overcharge.
“Furthermore, the decision makers are often senior equity partners and so take a very short-term view. We have created a competitive and transparent market that is aligned with the interests of the customer rather than the partners of big firms.”
He said there was “a growing realisation that smaller specialist firms are not only more cost effective but also provide superior service”.
Mr van Binsbergen added: “Meanwhile, larger corporates are increasingly hiring legal operations managers to review procurement practices and bring down legal costs. All of this is extremely encouraging for Lexoo.”
The company quoted Katherine Chandler, chief operating officer and general counsel EMEA at VICE Media, as saying: “Lexoo is a great way to source and engage quality lawyers, worldwide. We have used Lexoo for a variety of work, from getting quotes for one-off pieces of advice to helping us take on larger projects, enabling our team achieve what we want to achieve.”
Meanwhile, Juro, an artificial intelligence-enabled contract management platform, has announced leading travel search comparison site Skyscanner as its latest high-profile client following a successful pilot.
Juro, founded by one-time Freshfields associate Richard Mabey, already lists Deliveroo, Estée Lauder Companies, Nested, Unbabel and Hostmaker as clients. It raised £1.5m in funding earlier in the year, twice what it raised in early 2017.
Carolyn Jameson, chief legal officer of Skyscanner, said Juro’s “refreshing, innovative approach has been invaluable in shaping Skyscanner’s expanding contract management needs”.