Cloud-based, data-driven technologies are revolutionizing the legal field from the ground up, which is why Forbes recently called legal tech “the hottest thing in the $400 billion-plus U.S. legal market.” Firms hoping to thrive in this new environment and investors seeking to cash in on it should perk up their ears, because legal tech isn’t going anywhere but up.
Big tent, big changes
Legal tech (LT) is an umbrella term for modern, software-enabled legal tools and services marketed to businesses of all kinds. The time and money LT saves is so significant that adopting these products has quickly become a baseline “adapt or die” business practice, especially for law firms and corporate legal departments. And LT’s scope expands as new technology emerges and improves, which is constantly. Here’s just a taste of what’s hot right now in legal tech’s big tent:
Contract management and automation
Sophisticated contract management software makes every phase of the contract “life-cycle” (from generation through execution and renewal) more efficient, resulting in faster closing times, streamlined workflows, and revenue recovery. Contract software also provides valuable insight into how factors like deal type and size correlate with performance, risk, spending, profits, and more.
Traditionally, “due diligence” and”discovery” for big corporate deals or major lawsuits meant legal professionals had to review hundreds and even thousands of pages of documents one at a time. Computers can now do this in a fraction of the time, and, thanks to machine learning and AI, with highly accurate and insightful results.
When lawyers get ready to argue a case, a ton of factors go into formulating a legal strategy, including the judge’s previous opinions and temperament. Technology that helps attorneys conduct this kind of complex, multi-layered litigation and judicial analysis is quickly becoming a must-have for any trial lawyer.
Legal tech is reinventing the business side of law. Management software finely-tuned to the needs of legal practices address common challenges particular to this field, such as automated tracking for billable hours. LT is changing how firms reach customers, price services, and apply data-derived insights to everything from marketing strategy to staffing to procurement.
The roof is on fire!
When we say legal tech is hot, it’s hard to overstate just how much potential exists in this space right now.
Globally, the industry is estimated at around $16 billion, and growing. And since LT currently accounts for only about 20% of the wider legal industry, this means there’s plenty of room to spread out.
That means LT’s share of the “legal spend” pie is sure to rise in coming years, especially given the presence of long term growth indicators such as intellectual property expansion. For instance, between 2012 and 2016 patent applications for LT increased by almost 500%—which means a flood of new products and services are making their way through the pipeline at this very moment.
Closest to the action
So, in this super-heated environment, who are the stand-outs?
Well, today’s largest areas of LT spend include enterprise practice management, contract management, and eDiscovery. But of these three areas, only contract management (CM) is also projected to grow the fastest in coming years.
Another important trend is LT startups, which have raised nearly $2 billion to date. And the pace of that investment is accelerating, as seen in Crunchbase stats finding that LT startups raised $49 million in just the first month of 2018, versus $1.25 million for all of Q1 the previous year.
As a venture-backed CM startup, you could say Outlaw occupies the hottest corner of this hot little world; but of course, trends only tell part of the story. Not every CM software or startup is created equal. That’s why we built Outlaw to be supremely flexible and intuitive, with gorgeous design and the features you can’t do without.
Legal tech may sound like a buzzword, but it isn’t a fad or a phase; it’s how law gets done nowadays—and how it will get done, increasingly, in the future. So if your business is still doing things the old way, don’t wait a minute longer to make the switch. Innovation is a dish best served hot.