A legal spending analytics and tracking platform has raised $7m (over £5.7m) in its latest funding round, some of which will be used for expansion into the USA.
Former City solicitor Nicholas d’Adhemar, founder and CEO of Apperio, said the firm recruited its first US member of staff just before Christmas.
Apperio’s original plan, pre-Covid, was to open an office in New York, but the aim now was likely to be a distributed model in the US, with around 10 people in place by the end of the year.
“We’re more interested in where the talent is. We could have opened in New York, but we would have been severely limited in terms of talent, and most of our customers are not there.”
Meanwhile in London, Mr d’Adhemar, who also previously worked as a private equity investment manager, said staff numbers would grow from around 45 to 60-70 this year.
Apperio’s platform provides in-house counsel with a comprehensive view of legal spending on its dashboard, while aggregating and analysing historic and current spend, including work in progress.
The software also provides streamlined invoice approval, partly by connecting directly to law firms’ practice management systems. In-house lawyers can see in real time when the budget for a legal matter reaches a certain threshold.
The latest funding round brings the total raised so far by Apperio, launched as Legal Tender in 2013 before changing its name two years later, to just under $20m.
Molten Ventures (formerly Draper Esprit) led the latest investment round, joined by Notion Capital, IQ Capital, Nextlaw Ventures and new investors Volution and Hambro Perks.
NextLaw Labs, the business accelerator set up by global law firm Dentons, invested in Apperio in its second seed-funding round in 2016. Nextlaw Ventures, the sister company of NextLaw Labs is an early stage venture capital investor focusing exclusively on legal technology.
Mr d’Adhemar said Apperio currently worked with over 60 corporate legal departments and around 250 law firms.
He said the funding environment had changed significantly over the last few years, moving from “growth at any cost” to “economic sustainability”.
The maturity of the market has also changed: “Demand is still strong, but buyers have matured and become wiser.”
Apperio’s customers include Network Rail, savings and retirement business Phoenix Group and insurer Royal London Group.
As well as expansion, the new funding will be spent on product development to meet the demand for new functionality from law firms.
David Eldridge, non-executive chair of Apperio, added: “It’s no secret venture funding has slowed across technology sectors.
“That Apperio closed on funding with both new and existing investors, in this environment, speaks volumes to the company’s unique position in the legal technology sector, the value the company is delivering to customers and the significant opportunities ahead.”
A survey of 300 in-house lawyers operating in private equity and venture capital that Apperio carried out recently said tax, employment and litigation were the legal matters most likely to bust their budgets.
Asked how they respond to higher-than-expected invoices from law firms, half said they negotiated discounts, while 43% challenged line items.
Other responses were sending the invoices to an external bill review provider (36%), delaying payment (32%), rejecting the entire invoice (28%) and refusing payment (17%).
Nearly half of respondents (46%) identified a lack of transparency around time, billing and law firm invoices as a top barrier to controlling costs, with 39% still ‘always’ or ‘often’ surprised by the size of law firm invoices.
The name Apperio comes from the Latin ‘aperio’, meaning ‘I open, uncover or make clear’.