Are you looking for legal technology opportunities? Do you want to learn about investing or potential jobs? You’ve come to the right place. We will talk about the trendsetters in this article, including Clio, Clearway, and Avvo.

Our CEO Alistair Vigier 2022 was on the list of British Columbia’s 5 Top CEOs in the Legal Space list!

Before we get into it, if you are looking for legal technology opportunities to invest in, scroll to the bottom of this page and see our “Investor Relations” page. And then please reach out to us to see our pitch deck.

Jack Newton (CEO of Clio) and Rian Gauvreau saw that the cloud was going to revolutionize the legal industry in 2007.

These kinds of disruptive waves of tech don’t come along that often. Mobile phones were the last wave of tech to change the world back in 2010. Artificial intelligence has yet to come through and majorly change any industry. The other founder of Clio, Rian Gauvreau, used to work at Gowlings as their IT manager.

He realized that the technology that law firms were using was garbage. Around the same time, the law society was looking for better technology to help smaller law firms stay in compliance.

Only large law firms could afford a large support staff to stay on track with everything. Solo practitioners didn’t have anyone to help them stay on track.

Clio said that small law firms should use technology to catch the ball before it drops. This would help solo lawyers and small law firms stay in compliance.

Good Technology That Is Affordable

There was no good technology that was affordable. Lawyers would have to hire an IT manager and build a server. So Clio built practice management software that is cloud-based. This meant that small law firms would have to hire a tech manager and build a server. If you are building something that doesn’t exist, there are two outcomes.

Either there is no market for it, or you are about to become very wealthy. Clio was started by the founders of Clio remortgaging their house for capital. There was no investment around 2008 because of the financial crash.

Legal Education and the Online Courts

The real question was, will lawyers and the Law Society be comfortable with the information being stored on the cloud? Jack Newton is a big fan of the book, The Four Steps to the Epiphany. The book says to forget about the product development exercise.

Instead, think about customer development. Understand what your customers need, and then work backward from there. The important part of the book is the idea that if you can find 10 customers, you can find 100.

If you can find 100 clients, you can find 1000. But the key is to understand what the first 10 customers need. And then go and build the product after you know what the clients want. The job of a tech company is to make it look like its customers have superpowers.

Clio’s first customer came around 2008 around the time they built the beta version of their products. They were very strict about who they let into the beta.

Clio is a legal technology opportunity. It’s a central place that meets the needs of lawyers.

Legal Technology Opportunities

They would do onboarding for each new customer. Beta means that there are bugs everywhere and customer information could be lost. Their first customer wasn’t just testing the product but was using the product very heavily.

The customer loved the product and found a lot of errors. Clio then worked hard to fix all the issues. It was a call to action to make the product work for this first customer. If it worked for the first customer, it would work for thousands of other customers. Clio now does over $150M in sales each year. It’s valued at around $1.7B.

Lawyers are only using around 25% of their time for billable work

According to Clio, lawyers are only using around 25% of their time for billable work. This means that 75% of the time lawyers spend at work they are not getting paid. The average lawyer only gets paid for around two hours of billable work per day.

And then clients only pay around 80% of the bills the lawyers send out. Therefore, lawyers are only getting paid for around 1.8 hours of work per day. Pretty terrible. Many lawyers thought they would get rich when they were law students. For many lawyers, this was not to be. Instead, they are just trying to get by and pay their bills.

Client Expectations For Law Firms

There is also a massive gap between lawyer expectations and client expectations. There needs to be a bridge between lawyers and clients. When customers are looking for a lawyer, they simply want to be called back. Many clients have a hard time speaking to a lawyer.

Even though many lawyers complain about not having enough clients, they do a terrible job closing the leads that they do get. Many lawyers do not even know what a “lead” is. Lawyers just see people as either clients or non-clients. The lawyers don’t see the need to move a lead through a sales funnel.

Mark Britton, the founder of Avvo said that fewer than 10% of people that use Avvo get a callback or email from a lawyer who receives a lead. This is completely unacceptable. Every law firm needs to think about the customer experience when reaching out to firms.

Lawyers Need To Be Open To Working Remotely

These days as long as lawyers have a good internet connection at home, they can be successful working remotely. One of the things that people love about working from home is that they can see their family more. Instead of spending this time in traffic, you can spend more time with your kids.

During the COVID-19 pandemic, it was obvious that lawyers needed to upgrade their technological capabilities. It’s not a requirement for lawyers to be 100% cloud-based. But they do need to be open to change.

Because change happens regardless of whether they want it or not. Managing partners need to focus on the productivity of the lawyers who work for them. Not where the lawyers are working from.

Legal Technology Opportunity Concept Validation

There are so many reasons why legal tech startups fail. Most of the time, it’s because the market didn’t want what the company was selling. Legal tech is a specific industry. The legal industry is highly regulated as well. The technology company might not be regulated by the law society, but their clients are (the lawyers.)

It’s important to know what the Law Society rules are. Ideas are fantastic but the problem is that you shouldn’t fall in love with your idea. You must be able to accept feedback. You need to ask yourself what problem your issue solves. Is it a dollar issue? Are you saving your customers money?

Understand your customers

You need to understand your customers. Saying your customer is a law firm is not good enough. What types of lawyers are you going after as customers? You need to build this out and know this. You need to know who the competition is. Don’t say you are unique.

There is always some form of competition out there. You need to have deep thoughts and research about this. Why are you the right person to bring the product? Why is right now the right time? Many companies come too early or too late.

It’s okay to pivot if you are not making the difference that you want to make. ClearWay Law did that ourselves. We couldn’t make the difference that we wanted as a law firm. So we moved into being a legal technology company.

Signs Of A Good Problem To Solve

If you are not solving a real problem, people are not going to pay you for it. The pain point also needs to affect lots of different people. There needs to be a prominent issue. Something that someone needs only once in their life is not ideal. You want to find something regular to sell to people. It should also be time-consuming.

It should take up a lot of time for your clients to do. Further, it should not be stressful or boring for your clients to do. They would rather pay you than deal with it themself.

If it’s complex like family law, a lot of people would rather hire a lawyer than deal with it themselves. You don’t need to solve all the issues, but you should solve multiple problems.

Legal Technology Opportunities in the Modern World

When you get to an answer, you should ask why again. You can call it the five “whys.” If you ran a red light, why? Because I was late for work.

Why were they late for work? Because I don’t have an alarm clock. And you can keep drilling down on the “why” to find the real problem. You need to get to the core of the problem.

You should do 50% on client development. Also, you should do 50% on product development. Early on product development is not very important at all. It’s much more important to talk about customer development. If you don’t know your customer, you are probably building towards the wrong thing.

If you don’t end up building the product, the customers will never come to you. Who is the stereotype of the person who would use your product or service?

You want to get into their mindset. Do you want to include how are they feeling? What influences their decisions? The more information you have the better.

Some Examples of Legal Technology

In the graphic above, Clearway Law would fit into the “tech-enabled B2C legal services” category. Our company is most like Avvo. Avvo doesn’t operate in Canada. You can also see that LegalZoom made the list.

Clio is in the law firm management industry. We have also written about Axiom in the past. We don’t believe Total Attorneys exists anymore. Many of these companies operate outside of Canada. LawDepot and lawyer.com are well-known in Canada.

77% of legal issues go unaddressed by lawyers

The best companies respond to leads in minutes. Top software companies like HubSpot get back to clients extremely quickly. When lawyers get back to clients within days, it’s horrible.

It’s important to measure the response team in minutes. If lawyers think two days is good, and customers think two minutes is acceptable, how do you bridge the divide?

There is so much opportunity for lawyers to thrive in the industry. To make their clients happier and to solve the access to justice problem. However, things are not moving fast enough. Lawyers need to do a better job at innovation. 77% of legal issues go unaddressed by lawyers.

Any industry that was well put together would find a way to quickly solve this problem. The way that legal services are offered today is the same as it was thirty years ago. Lawyers learn how to practice law from those who practiced law thirty years ago (law school professors.)

Downloading legal forms

Legal websites are a popular place to go when consumers are looking to download a legal form that looks convenient and cost-effective. Many legal professionals have argued that using such platforms could cost you money in the future. That legal forms are inadequate and in some cases could even lead to larger problems later.

It’s up to you to decide if you are comfortable taking the risk of downloading legal forms on the internet. Next in this article, we will take a look at the future of lawyers, or if legal tech companies will completely take over.

Are lawyers even needed anymore? We are working hard to be successful in the legal innovation industry. We have gathered several of the lessons we have learned by speaking to and studying major successful companies.

There are a lot of legal technology opportunities out there.

Evolving legal trends

The internet changed everything over the last two decades. As time went on, it was clear that lawyers were going to need to catch up to evolving legal trends. Many law firms also don’t understand marketing.

Gaining top spots on Google requires writing thousands of blogs. You need to get tons of backlinks in the media. The media only publish around 5% of the articles that are sent to them. We put together a guide for SEO for lawyers that’s worth checking out.

At the end of working hard at content creation, you need to make sure that once someone comes onto your website, they convert into a lead. Only once someone converts into a lead can it be sent to a law firm.

Legal Technology Opportunities

Law firms are willing to pay good money for quality leads. We saw that this business model was working well down in the USA, and we wanted to bring it to Canada.

An online platform for legal services connects people with legal problems and a lawyer. This is done in a way much easier than before. People can quickly find the best lawyer for them. And unlike a law firm, an online business requires little money to run the business.

There is no fancy office, office supplies, or art to line the walls. All the money goes into improving client service, branding, marketing, and technology. Most legal innovation focuses on artificial intelligence and high-end technology services.

But what about fixing the most simple of problems? According to the Legal Trend Report, 64% of people have a hard time connecting with the right lawyer. Legal tech companies need to focus on solving that basic problem.

Legal Technology Opportunities

We are working hard to use any resources they offer to carry out our mission of improving the legal industry. We used to be a law firm, so we know how hard things can be for lawyers.

Lawyers are now our clients. We work hard to make sure they are connecting with clients that are serious about hiring a lawyer. For the past few years, we have been trying to direct lawyers, innovators, and techies to the massive untapped market that is the legal industry.

Around 70% of individuals going through the courts during a family law dispute do so without a lawyer. There are new kinds of companies competing with law firms. Many lawyers want to start their businesses. The idea of being their boss is very attractive.

We hope you found this legal technology opportunity article interesting.