The document discusses how the COVID-19 pandemic is accelerating the adoption of digital technologies across the legal industry. Key points include: interactions with the law are moving online; work from home is becoming permanent; legal work is shifting to digital devices; budgets are tightening and legal teams are relying more on software; and policy changes are bringing new opportunities for legal innovation.

1. CONFIDENTIAL
APRIL 2020
Briefing

2. CONFIDENTIAL
THE
LEGALTECH
FUND
"There are decades where nothing happens, and
weeks where decades happen."
– TYLER COWEN, AMERICAN ECONOMIST

3. CONFIDENTIAL
legaltech.com
The New Normal
1

4. CONFIDENTIAL
legaltech.com
Theme: Accelerating to the future
● Everything moves online
● Interactions with the law go digital
● Work from home is here to stay
● Business moves to devices
● From W2 to 1099
● Software & structured data disrupt law
● GCs tighten budgets and turn to software
● Policy changes bring new innovation
● Freemium will drive adoption in legal
● Great experience drives customer growth
● Change is coming to legal services and
creating the court of the future

5. CONFIDENTIAL
legaltech.com
60% of organizations
significantly increasing their
use of virtual classroom
training because of the
COVID-19 coronavirus
pandemic.
In-person trainings are canceled
Sources: Institute for Corporate Productivity (i4cp), Chief Learning Officer

6. CONFIDENTIAL
legaltech.com
Education
65% of parents worried about
children falling behind as
schools go online
Worldwide university closures
impact 1.57 billion students
Massachusetts may offer bar
exam online
Learning is changing and moving online
Sources: App Annie, EdTrust, MarketWatch, WeForum
WEEKLY iOS / ANDROID USERS

7. CONFIDENTIAL
legaltech.com
+50X
Work
📈 20X+ demand for online
meeting software and similar
services
Work has become a series of video calls
Sources: App Annie, Legaler, MarketWatch
+200%
+50%
GLOBAL DAILY USERS
1/13 3/20 4/20
UNIQUE LAW FIRM SIGN UPS

8. CONFIDENTIAL
legaltech.com
Online delivery of
home goods
7X growth in downloads
Ordering food has become an on-demand service
Sources: App Annie
NEW USERS AND APP DOWNLOADS
8,000,000
6,000,000
4,000,000
2,000,000
800,000
200,000
4/19 4/20
600,000
400,000

9. CONFIDENTIAL
legaltech.com
70%+ traffic growth to online
notaries in March as
consumers seek online
alternatives
Interactactions with the law move online too
Sources: SimilarWeb, Google
U.S. TRAFFIC GROWTH
+400%
+71%
2/20 3/20
200k
100k
+76%
110,000
190,000

10. CONFIDENTIAL
legaltech.com
125% increase in mediation and
coaching sessions
90% of sessions are
Corona-related co parenting
issues
Responded to crisis by building
network of retired judges to
offer free remote mediation to
families with Corona-related co
parenting issues
Family mediation has become digitally-enabled
Sources: Company provided information

11. CONFIDENTIAL
legaltech.com
74% of
companies
Will have > 5% of workforce
remain permanently remote
- Gartner, April, 2020
Work from Home is here to stay
Sources: Gartner, Northeastern University, Privva
Up to 19
times
REMOTE / TELEWORK
LEGAL APPLICATIONS
LAW FIRMS (BY
CLIENTS)
SMART DEVICES TURNED ON
ACCIDENTALLY PER DAY
+600%
+37%
SECURITY REVIEWS RELATED TO
LAW FIRMS: JAN FEB vs. MAR APR

12. CONFIDENTIAL
legaltech.com
Legal Software
Several companies reporting
⬆ 20%+ in the last 30 days
Where attorneys are getting work done
Sources: Docusign, Zero
TRAFFIC INCREASE
IN APRIL
+ 28% + 22%
INCREASE IN PIPELINE
ACTIVITY IN MARCH

13. CONFIDENTIAL
legaltech.com
Business Apps
Gain Share
Business Apps represent five
of the top twenty apps in April
2020 vs. zero of the top twenty
for calendar 2019
And our personal devices are turning into work devices
Sources: App Annie
TOP BUSINESS APPS IN APRIL

14. CONFIDENTIAL
legaltech.com
Moving away from
Ages & Stages
We are seeing a shift from W2 to 1099 across the economy
Education
Work
Retirement
Education
Exploration
TRADITIONAL
MODEL
MULTI-STAGE
MODEL
Traditional
employment
Self-
employment
Portfolio of
work
Retirement
Education
Sources: MIT Sloan School of Management

15. CONFIDENTIAL
legaltech.com
Corporates
embrace freelance
As freelance population
explodes, growing to 90M by
2028
This trend is in its early innings
Sources: Intuit, Statista
+80%
90M
57M
2017 2028
MAJOR CORPORATIONS INCORPORATING
ON-DEMAND TALENT BY 2030
FREELANCE POPULATION GROWTH

16. CONFIDENTIAL
legaltech.com
+77%
Enables quick
pivots based on
circumstances
And empowers firms to change legal strategies easily
Sources: Hire an Esquire
March/April
revenue
relative to 2019
JOB POSTING INCREASES
JOB POSTING DATA MARCH / APRIL 2020
20% +40% -30%
Bankruptcy Labor &
Unemployment
Commercial &
Corporate

17. CONFIDENTIAL
legaltech.com
Legal less affected with hiring
down only ~2% in March and
up ~4% in April.
Legal is faring better than other industries
Sources: Vox
LEGAL INDUSTRY HIRING IN APRIL

18. CONFIDENTIAL
legaltech.com
But software can replace basic lawyering tasks

19. CONFIDENTIAL
legaltech.com
“We are saving our clients weeks of
time on Co-Tenancy Clauses alone.”
– Gabriel Safar, CEO LeasePilot
Legal needs in every industry are met with tech solutions
Clayton Christensen’s Theory of “Disruptive Innovation”
Sources: Harvard Business Review

20. CONFIDENTIAL
legaltech.com
“90%of participants
said controlling outside
counsel costs was a high
priority”
“...leveraging technology
and data enables legal teams
to work smarter, to better
measure exposure, and to
predict where problems might
emerge, and this will enable
managers to deploy their
resources in optimal ways.”
62% of
companies
Expect cuts to SG&A in the
upcoming fiscal year
We think shrinking GC budgets = ⬆ reliance on tech
Sources: Gartner, Thomson Reuters
1 out of 4 CFOs
plan to cut legal spend
by 10%+ in 2020

21. CONFIDENTIAL
legaltech.com
Move to cloud
Nearly 9 out of 10 IT
professionals anticipate moving
to cloud systems from on-prem.
Decreasing budgets = ⬆ cloud usage (vs on-premise)
“This is the event that will force any
law firms not adapted to remote,
universal work to move to the
cloud.”
– LARRY PORT, ROCKET MATTER
Sources: Gartner, INAP

22. CONFIDENTIAL
legaltech.com
Including software to shrink outside counsel spend
Sources: Company websites
Additional scrutiny on outside
counsel spend
Firms drive down outside legal
spend via RFPs

23. CONFIDENTIAL
legaltech.com
Policy is also changing...rapidly
Sources: CNN, The Washington Post, CNBC, The Baltimore Sun, Axios
39 states + PR have statewide orders
urging or mandating virtual hearings.

24. CONFIDENTIAL
legaltech.com
Sources: Company websites
But policy is leading to new tech companies and products
Distance
depositions, courts,
and more

25. CONFIDENTIAL
legaltech.com
“Free” models will quickly get software into the hands of the end
users
30%
??% LegalTech
ARPU
CONVERSION RATES
4.0%
4.1%
0.5%
CONVERSION RATES BY FREEMIUM TOOL
Sources: Company websites, Dejan Gajsek

26. CONFIDENTIAL
legaltech.com
Great experiences will keep customers & unit
economics that work
Sources: Profitwell, Struto
CAC PAYBACK MODEL
LTV
CAC
CAC Payback
SUCCESSFUL MODEL
LTV
CAC

27. CONFIDENTIAL
legaltech.com
Legal industry #1 in online
discussion about change.
So we think change is coming
Sources: Above the Law, LinkedIn
COVID-19
POSTS BY
INDUSTRY
COVID-19 crisis has “reframed legal
services,” and in the course of that,
“technology has become a lifeline.”
– ROBERT AMBROGI & JOANNA GOODMAN

28. CONFIDENTIAL
legaltech.com
Coordinate with
multiple agencies
Esign pleadings
Schedules hearings with
text reminders
Share critical information
Criminal chatbot integration
Online court attendance via
Efficient case management
The courtroom of the future?
Total cost < $5k a year
Judge Scott Schlegel,
24th Judicial Court
Jefferson Parish, State of
Louisiana
Learn more at Courtonline.us
*Not an endorsement of any specific company

29. CONFIDENTIAL
legaltech.com
But forget us… check out what the entrepreneurs are saying!

30. CONFIDENTIAL
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