A lawyer-matching service originally designed for tech start-ups and SMEs has secured a second, much larger cash injection of £850,000 from a range of investors led by e-commerce specialist Forward Partners.
Daniel van Binsbergen, chief executive of Lexoo, said some of the new funds would be used to target cash-conscious in-house lawyers at large companies already using the service to save money.
The company, based in Shoreditch, London’s tech capital, announced a funding deal worth £260,000 in January.
Businesses post a job on the website and receive a number of fixed-price quotes from lawyers vetted by Lexoo and with expertise in the area. Clients compare the quotes and make their own choice.
Mr Van Binsbergen, a Dutch lawyer based in London, said the company reached its target of processing £1m of legal work by the end of this year in July. He said the service now aims to process from £1.5m to £2m of work this year.
“When we started out, most of our clients were SMEs with up to 50 employees. They had a generalist local lawyer, but wanted specialist advice on a specific matter, such as intellectual property.
“Recently we’ve seen the service being used differently by larger companies. It could be an in-house lawyer paying a high rate for simpler kinds of work, like small-scale employment matters or commercial contracts. SMEs want a fixed fee for a one-off project. In-house lawyers want hourly rates and to compare lawyers based on that.”
Mr Van Binsbergen said Lexoo had expanded the number of law firms it works with from 100 to 150, and added south of England commercial firm Pitmans to its existing list of larger firms – Thomas Eggar, Fieldfisher, Harbottle & Lewis and Fox Williams.
He said Lexoo currently works with around 200 individual lawyers, who pay a commission of 10% on the fees they receive from clients.
Mr Van Binsbergen said he would use some of the new funding to improve marketing to larger companies, which were still “very much a minority” of clients.
He added that finding a lawyer could be an “intimidating prospect” for entrepreneurs, who tended to hire through a combination of personal connections and searching Google.
“Going down this route doesn’t answer the two key problems faced by business-owners – making sure they’re paying a fair price and finding a lawyer with the right experience.”
Nic Brisbourne, managing partner of Forward Partners, commented: “Daniel and the team at Lexoo have achieved an amazing amount with what was a relatively small amount of seed funding.
“I’m confident this new funding round gives them the runway to pull the legal services industry into the 21st century.”