A series of layoffs at online mortgage lender last year left thousands of former staffers scrambling to find a job. But not . He was thinking term sheets.聽

Sahai, a 27-year-old Colorado native, joined Better in 2018 as a loan consultant, working his way into a post as legal analyst a year later. Alongside his job, Sahai was studying for a law degree at

The combination of work and studies helped germinate the idea that culminated in his legal tech startup, , when Sahai had trouble finding software geared for managing workflow at a busy and growing in-house legal department.聽

After getting laid off from Better in August, Sahai, now a law school grad, had time to devote to startup building. In subsequent months, he and his team developed an initial product they鈥檙e pitching to in-house legal teams as a tool to streamline workflow and help manage incoming requests, documents and internal communications.

Gaining momentum

Sahai said momentum picked up in December, when the startup got initial backing from seed and early-stage investor .

鈥淭hat started accelerating things,鈥� he said, noting that shortly afterward, co-founder and CTO Ilia Rogov, also a former Better employee, came on board. The company also landed its first enterprise client, along with some smaller customers.

Composure is now going out for a pre-seed round. There鈥檚 no hard target at the moment, but Sahai said comps for similar rounds usually fall in the $1 million to $3 million range. So far, the startup has raised a little over $300,000 from Day One and angel investors.

From suing to SaaS

Part of what makes in-house counsel workflow appealing from a startup perspective is that it is both complex and kind of repetitive.

Day-to-day workflow, as least for a larger organization, is likely to include both inbound and outbound litigation. Unfortunately, as companies scale, Sahai noted, eventually 鈥渋t’s just a fact of life that someone鈥檚 going to sue you.鈥� (Or vice versa.)

Beyond lawsuits, there鈥檚 usually a lot of in-house work around compliance and regulatory approval. This can be a particularly large workload for companies in heavily regulated industries like finance or health care. In addition, in-house legal teams have to devote resources to overseeing intellectual property protection, internal investments, and weighing in on terms for vendor and sales negotiations.聽

The idea behind Composure is to make it easier to track the tasks and documentation involved in all those myriad responsibilities, and to divvy up workload accordingly.聽

Starting in a downturn

While this is not the easiest time for startups to find funding, Sahai for now sees advantages in launching a company amid a market downturn. For one, out of necessity, everyone is focused on capital efficiency. That ought to have some long-term advantages.

Customers are also tightening their belts. As a first-time founder, Sahai said in the past year he鈥檚 realized how much resilience is required to keep a nascent venture afloat. Most queries end in rejection, with only the outliers culminating in a 鈥測es.鈥澛� He compares the relentless forward push to football:

鈥淵ou鈥檙e punting a lot. 鈥� And then, once in a while, you find a gap and you run it down for a touchdown,鈥� he said.

Illustration:

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UpCounsel previously raised a total of $14 million since its inception in 2012. This latest round brings its aggregate funding to $26 million. Most recently, the San Francisco-based startup raised a $10 million Series A round that closed in July 2015. , , , and聽participated in the round.

It is not clear from the SEC filing who participated in UpCounsel’s latest round, although the filing indicates there were 12 investors who were a part of its Series B. At the time of writing, UpCounsel had not responded to SA国际传媒 News鈥檚 request for comment.

Small and large enterprises use UpCounsel to supplement or replace large law firms or traditional service providers. The UpCounsel community is made up of part-time, solo, and boutique attorneys who hail from global law firms and graduated from top law schools. Customers include , , and investor .

, founder of legal web strategy consultancy AttorneySync, believes that UpCounsel makes a lot of sense from the perspective of business legal services consumers.

鈥淭hey take a lot of the pain out of the lawyer search process,鈥� Tsakalakis told SA国际传媒 News.

However, Tsakalakis is skeptical of the startup upon completion of a project.

鈥淚’ve always thought that these sites face something of an identity crisis, namely, is their primary function to serve legal services consumers (i.e., their users) or their lawyers?鈥� he said. 鈥淣eedless to say, these interests aren’t always aligned鈥�. If consumers lose trust in the integrity of a platform, they’re more likely to fall back on traditional notions of getting referrals from people they know, like, and trust鈥攚hich they should still be doing anyway.鈥�

It is that , another online legal marketplace, had, according to Tsakalakis.

鈥淩ating lawyers is really hard. It’s not like rating a restaurant,鈥� he said. 鈥淚 have yet to see a lawyer rating site that does a good job of matching based on qualitative data.鈥�

滨濒濒耻蝉迟谤补迟颈辞苍:听

In January of last year, legal tech startups聽聽according to SA国际传媒. But this year, the same group of companies have raised a touch over $49 million in just over a month’s time.

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So what’s pushing such a strong start to 2018 in legal tech? It turns out making easier is a good way to attract funding in the sector. And two startups in the niche,聽 and , are leading the way.

Logikcull

Founded in 2004, , Logikcull has been offering eDiscovery services for over a decade. Andy Wilson, its CEO, described his company to SA国际传媒 News聽as “the only fully featured, and entirely self-serviced, eDiscovery platform in the cloud.”

However, it wasn’t until 2015 that Logikcull looked to investors and with Storm Ventures leading the event. A year later, the eDiscovery platform Series A, adding OpenView as a lead investor. The cloud-based eDiscovery platform has found itself one step away from being a late-stage startup announced January 29th, bringing its total funding to $39 million. The round was led by New Enterprise Associates, with Storm Ventures and OpenView staying on deck.

According to a company on the raise, it took Logikcull just over two weeks to raise the new capital. How it managed to do this likely comes down to the startup’s pace of growth.

In addition to growing its customer base by 500 percent in less than a year, Wilson told聽SA国际传媒 News聽the startup projects it will also聽“hit 10 TB uploaded/day” in the next two years. Currently, the company is nearing 1 TB of data uploaded a day.

It also doesn’t hurt that the company didn’t exactly need funding to keep itself steady.

“We weren’t聽looking to raise money. The business was well capitalized before NEA approached us about investing,” Wilson told SA国际传媒 News. “We took the investment because it will help us accelerate future product development鈥�2020 bets鈥擟hetan, the partner at NEA, has an amazing track record of helping to take companies public, one of our long term goals.”

He also added “this bull market can’t last forever,” a comment that would prove timely given recent market behavior.

But Logikcull isn’t without its competition. We only have to go south to find it.

CS Disco

Much like Logikcull, offers software solutions to help with the eDiscovery process. CS Disco also augments its software with eDiscovery professionals, complemented by artificial intelligence the startup calls Disco AI.

The startup has for its eDiscovery solution, with its latest announced merely one day after Logikcull’s $25 million Series B. Its investors include LiveOak Venture Partners, Bessemer Venture Partners, and the Arkansas-based Stephens Group.

The company, in a , labels its Series D as “growth financing.” CS Disco intends to “double its engineering and product team to continue investing in the eDiscovery solution DISCO Review while also beginning to expand the DISCO platform beyond eDiscovery.” Bessemer Venture Partners, which led the Series D round, noted it was “thrilled to have the opportunity to double down” on its investment due to its growth.

鈥淚n 2017, we grew revenue by 2.7x overall and by more than 3.3x in the AmLaw 200 segment,” said founder and CEO Kiwi Camara in a release. “Our accelerating growth is driven by both more and more firms switching to DISCO firm-wide and the tremendous loyalty of our existing customers, who grow their business with us every year.鈥� CS Disco claims over 400 law firms as customers.

As noted in previous reporting, many legal tech startups are still in the seed and early-stage, providing a healthy pipeline for later-stage deals. Whether CS Disco and Logikcull represent a harbinger of more deals to come for legal tech’s early-stage cohort remains to be seen.

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