Deloitte’s law arm has launched a program designed to “propel” early-stage legal tech companies while using their products, in its latest of many forays into global legal services.
Through Deloitte Legal Ventures, the young companies, many of which are still startups, will allow Deloitte Legal to become users of their products and services from their beginning stages, so the Big Four behemoth can help with testing and scaling.
After analyzing the offerings of nearly 400 companies in early venture capital phases—from pre-seed to Series A—Deloitte selected 14 companies to be its first cohort. They include legal tech “app store” Reynen Court, which has enlisted 18 Big Law firms as backers, the law firm time-keeping startup Ping, and contract automation platform Avvoka.
“We are focused on developing long-term, meaningful relationships with these companies,” said Laura Bygrave, innovation and Ventures lead at Deloitte Legal, in a statement. “Starting as the user enables us to understand how a product or service can transform how we work and how it can benefit our clients.”
Deloitte’s legal services work has grown fast in recent years outside the U.S., alongside those of the other Big Four accountancies, KPMG, PwC, and EY.
Top law firms have taken notice of this trend, and this, combined with the Big Four’s advanced tech capabilities, have led some to fear more serious incursions into law firms’ business lie ahead.
Deloitte is not asking for exclusivity through the Ventures program, nor is it placing any restrictions on vendors that might inhibit their growth, Bygrave said.
According to a spokesman, Deloitte is also not making financial investments in their vendors, or taking equity stakes, as venture capital companies would.
Full Speed Ahead
There are some parallels between the Deloitte program and legal tech incubators, which support new companies through product development, and accelerators, fixed-term arrangements through which startups can get funding and sometimes mentorships. Allen & Overy’s Fuse and the Dentons-connected Nextlaw Labs are examples of an incubator and an accelerator, respectively.
Deloitte thought it important to form a new type of program, the Big Four accountancy’s spokesman said in a written statement, given that the market currently is “saturated” with incubators and accelerators.
“Deloitte Legal Ventures is a specific programme to better shape and test the proof of concept process,” he said.
Through that process, prioritized sets of assumptions will be tested using specific metrics to gauge, from the outset, if the vendor’s business is succeeding.
At the same time, Deloitte’s Venture Path methodology will allow company experts to stress test the vendors’ business models to identify if, and how far, they can scale.
About two-thirds of the selected companies have products or services that are operational, and already have existing clients. The rest are at the earliest pre-revenue stage of development, or have chosen to work with Deloitte Legal in order to develop their offering in a “sandbox” environment.
Other companies selected include Autologyx, CourtQuant, Crafty Counsel, Define, Genie AI, Juralio, Kormoon.ai, Sente Advisors, and Tabled.io. The last two of the 14-vendor cohort have asked to remain anonymous, the Deloitte spokesman said.
Deloitte Legal boasts about 2,500 lawyers working in more than 80 countries, its spokesman said.