The Big Four accountancy firms and technology groups are competing with law firms in this growing market.
When UnitedLex recruited five senior staff with extensive experience at the Big Four accounting firms, the hires were a statement of intent. By appointing senior figures from professional services firms earlier this year, the legal tech company was reinforcing its strategy to offer services as well as products.
Legal technology companies such as UnitedLex are also now winning big investments from backers that include private equity giants — even the Big Four accountancy firms. And this development is another indication of their move into offering new services to compete with lawyers and consultants — and of their increased firepower in a once nascent market. Among the UnitedLex hires were David Clarke, former PwC digital strategy and innovation leader, and Mike Duggan, who was a partner at Deloitte for 10 years.
At the same time, though, the Big Four firms, including auditor Deloitte, have been fighting back. In the past year, they have spent heavily on hiring from high-growth legal technology companies, to expand their own legal departments.
Until recently, this legal technology market used to be dominated by small companies offering single solutions to lawyers, such as tools to speed up document reviews, or to spot key words amid reams of court filings. Now, however, the tech companies are competing with law firms for the first time by offering consultancy, which was previously the preserve of professional services firms.
“There is much more momentum and investment [in law tech] now,” says Eleanor Weaver, chief executive at legal tech company Luminance. “There is a sense that this could be the new fintech market.”
In 2019, Thomson Reuters and Legal Geek estimated that the amount invested into UK legal tech start-ups had been rising year-on-year and had reached £260m in total. But, globally, the sums have been far higher. In 2014, European private equity firm Permira invested $200m in the US’s LegalZoom, a company that lets customers create legal documents without a lawyer, to take a controlling stake. In 2018, private equity firm CVC raised the stakes by investing $500m into UnitedLex, in one of the biggest deals yet with a legal provider.
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