Legal tech segment to see consolidation

Jansen said that law firms and corporate legal departments are facing increased pressure to do more legal work for less money. This has precipitated a disaggregation of workloads and increased adoption of new tools to streamline processes, as well as an unmanageable field of small, specialized tech providers.

"A large law firm or corporate legal department cannot work with hundreds of outside tech vendors," he told AVCJ, noting a recent boom in legal tech investment and company creation. "Platforms are being built and consolidation is coming. We think these forces, and others, make our timing excellent for focusing on and investing in legal tech."

Legal tech investment, excluding debt, grants and post-IPO rounds, grew 184% globally during 2018 to $794 million, according to Tracxn. It reached $764 million by July this year. In Asia, investment totaled $187 million in 2018 – up 318% on the prior year – and came to $118 million in the first seven months of 2019. The number of legal tech start-ups founded during the four years to end-2018 was 1,077 globally and 308 within Asia.

Asian traction has been driven by a groundswell of incubator creation, often combining the resources of government agencies, law firms and VCs. These include Australia's LawTech Hub, a collaboration between YBF Ventures and law firm Lander & Rogers, as well as the Future Law Innovation Program (FLIP), an initiative of the Singapore Academy of Law's investment unit SAL Ventures. In December, FLIP helped law firm Clifford Chance launch its own incubator called Create+65.

Recent investment in the region includes a $25 million Series B round for Taiger, a Singapore-based company that uses artificial intelligence for a range of business automation products and services. The idea is to help the company expand operations into legal tech by developing new contract auditing, document updating and document search technologies.

Meanwhile, BestSign, a Chinese digital signature player, received an approximately $52 million Series C.

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