The recent influx of cash into legal tech start-ups shows little sign of abating, after deal platform Legatics and property transaction platform Thirdfort both announced sizeable funding rounds to accelerate growth.
For Legatics, a member of Allen & Overy’s last two Fuse innovation hub cohorts, the investment gives the company a £3.14m valuation. Its £500,000 investment came from a combination of angel investors and venture partners.
The investment round will also see two non-executive directors join the Legatics board, namely former A&O board member Simon Black and former head of investment banking for EMEA at MUFG, Andrew Jameson.
The news follows Legatics’ move as one of the first 17 companies into banking giant Barclay’s LawTech Eagle Lab in August. Legatics expect to use the funding to branch out into more diverse transaction types, while also hiring new developers and making additions to the company’s existing platform.
‘We’re looking at growing the team and increasing our global expansion,’ Daniel Porus, head of business development at Legatics told Legal Business. ‘There is interest from an array of firms globally and we also want to continue rolling out our new use cases, beyond banking and finance, such as our use cases for M&A and equity capital markets transactions.’
Thirdfort, meanwhile, raised £400,000 in a funding round led by Alex Chesterman, the founder of Zoopla, and Lawyer Checker. Founded in September 2017 by Olly Thornton-Berry and Jack Bidgood (pictured left to right), Thirdfort acts as a payment platform to facilitate residential property transactions and is FCA-regulated.
Like Legatics, Thirdfort has featured in a law firm’s legal tech programme, namely the second cohort of Mishcon de Reya’s MDR LAB.
Thirdfort’s relationship with Mishcon will likely continue, with the company expected to undertake a pilot with the firm before the end of the year before an expected product release in 2019.
Speaking to Legal Business, Thornton-Berry said the investment will fund new hires as the three-person company enters a demo stage in early November: ‘The majority of it will be used for hiring more developers and operational people, as we do all our development in-house.’
Thornton-Berry added that companies with a history at firm and corporate start-up programmes, such as Fuse and MDR LAB, will remain more attractive to potential investors: ‘Investors look for signs of validation at an early stage, and corporate incubators provide that.’
Porus, however, stressed such experiences were advantageous, but not essential, for early-stage companies pursuing investment: ‘Our experience with Fuse has been a phenomenal one, it was a huge benefit to us and there seems to be a trend there, but there have been companies who were not involved in incubators securing significant funding rounds. It’s all about what works for individual companies.’
The investments follow a string of legal tech funding rounds in the last few months. Last week, flexible lawyering start-up Lexoo raised $4.4m, while a month ago leading AI platform Kira Systems sealed $50m in private equity backing.
Other deals this year include legal fee tracking platform Apperio raising $10m in August, Bloomsbury AI joining Facebook in a deal reportedly worth between £23m and $30m, Eigen Technologies securing £13m in funding and email security AI company Tessian raising £9m.
In other legal tech news last week, contract management start-up Juro announced travel search comparison site Skyscanner as a new client. Juro also raised $2m earlier this year.
For more on the legal start-ups vying for positions in the market, read our special report ‘The wheat from the chaff – Hustling start-ups meet City law’