Investment continues to flow into New Law and legal tech with US-based law company Elevate securing $25m in private equity backing while legal tech start-up Orbital Witness raises £1.2m.
Elevate today (17 June) announced that private equity house Kayne Partners had injected $25m into the New Law pioneer in what is the first significant private equity investment into the company since its inception.
‘We see it as a real vote of confidence in the company,’ Elevate president John Croft (pictured) told Legal Business. ‘We’ve reached a scale where we’re able to do a deal like this and still keep Elevate in charge of the strategic decisions.’
The minority investment by Kayne Partners will see the private equity firm acquire a less than 10% stake in the Elevate business, while Leo Chen of Kayne Partners joins Elevate’s board of directors.
Croft added the investment will likely see Elevate continue its acquisitive form, which in January of this year saw it buy UK-based flexible lawyering business Halebury.
Last year was also dominated by buyouts, with Elevate acquiring AI creator LexPredict and contract lifecycle management provider Sumati Group. Elevate claims to have grown at an average of 65% annually over five years, with 2019 sales forecasted to exceed $75m.
The investment is a significant stepping stone in Elevate’s plans to float, with a potential 2021 initial public offering a longstanding strategy for the company.
‘It’s another important step,’ Croft continued. ‘We have brought in a serious amount of money and it’s an important development for us as a law company.’
Elsewhere, legal tech start-up Orbital Witness last month rose £1.2m, backed by JLL Spark, LiFE Ventures and Seedcamp. The start-up – which looks to identify legal risk in property transactions – will use the lion’s share of the funding to bolster the company’s development team.
The company’s customer base has also seen growth, with Orbital Witness launching its first product aimed at the in-house market, with retail outlet Marks & Spencer an early customer.
Orbital Witness co-founder and chief executive Edmond Boulle told Legal Business of the company’s backers: ‘We wanted wide-ranging property sector expertise. We’re good at building this product for property lawyers but eventually we want it to reach out to a wider customer base of home buyers, lenders, and developers, so we needed that expertise to understand how all the moving parts work across the industry.’
He sees the amount of cash flowing into the start-up sector as a sign of imminent consolidation: ‘The volume of funding coming in is probably indicative that at some point there will be consolidation. To some extent, companies are solving different pieces of the same problem.’