Where are the UK legal tech unicorns?

Last week I joined a group of fellow UK scaleup founders at 10 Downing Street for the launch of the 2024 Future Fifty cohort.

Wandering up and down the iconic Hugh Grant disco staircase from Love Actually was a bit surreal. We fought our natural instincts to dance ironically and kept our cool:

It was a fun photo opportunity, but of course, it represents countless hours of my team’s work building and scaling both Juro the product and Juro the company, and I was so proud to represent us.

But interestingly, Juro was also representing legal technology as a whole, as the only legal tech vendor in the Future Fifty cohort. This got me thinking.?

The UK legal services industry is worth about ￡44 billion. The US market is worth more like $350 billion, according to Statista.

If we compare those numbers to the market caps of even the very biggest US legal tech giants, true legal tech penetration is quite low.

DocuSign is worth about $12 billion and it’s sort of a legal tech company but not really. Some of the biggest enterprise players, like Thomson Reuters (owner of Practical Law, Casetext, HighQ and others) and RELX (owner of LexisNexis, Law360 and others) would be worth much more. But these are primarily information and publishing companies first, rather than tech scaleups.

There’s no Salesforce for legal.

Salesforce, by comparison, is at $38 billion in annual revenue and is worth just shy of $300 billion in market capitalization. So given the addressable markets in play, in a sector like legal, which is apparently being transformed by disruptive technology, there’s a clear mismatch.

There’s no Salesforce for legal. There are a few companies at a couple of hundred million in annual revenue; but what is going on with the level of scale and ambition of legal tech companies - particularly in Europe - that’s creating such a mismatch? Why isn’t this very loud and energetic corner of scaleup land making its presence felt at a bigger scale?

The goal of the Future Fifty programme is to promote scaleups within the UK, and help them to reach a level where they can achieve huge valuations and perhaps list publicly - like previous cohort members Deliveroo , Wise and Just Eat Takeaway.com .

As a partner to the programme, what struck me on the day was just how sincere the Government is in supporting this. The Department for Science, Innovation and Technology (DSIT) has a deep bench of talented civil servants working hard to make the business environment, as well as physical and virtual infrastructure, optimal for UK scaleups to grow and thrive. There really is good intent there.

There’s a consultation ongoing to create an innovative new market to enable technology companies to scale and grow. You can read all about PISCES here - without getting into the weeds, more options for liquidity and more flexibility when it comes to funding can only be a good thing for UK tech companies’ competitiveness.

Then of course there’s the AI regulatory sandbox. At Juro we’re big believers in doubling down on safety and privacy when it comes to the rollout of innovative technologies like generative AI (you can read more in our Trust Center here). Anything the regulators can do to encourage private companies to experiment safely is more than welcome.

All that having been said, the reality is that the number of tech companies going from idea to startup to scaleup, and coming out the other side as a large public company or giant acquisition, is really small (as Daniel Glazer can tell you). We’re fortunate to have as customers some of the success stories who’ve listed in the UK, like Trustpilot and Deliveroo, but as far as legal tech itself? It’s not really happened yet.

But we’re living in an ‘AI spring’, and the pace of change it’s bringing is something we’ve not seen in a long time. For example, last year we were delighted to win ALM Law.com Product of the Year, deservedly collected by our Head of Implementation, Sharen Gill . This year, there are two awards instead of one - Product of the Year, and AI Product of the Year (we’ve been shortlisted for the latter).

Is generative AI the unlocking technology, then, that will allow us confidently to get to the point where the UK has multibillion-dollar legal tech companies, having a major impact not just domestically but globally?

Of course, I would say yes - the majority of our customer base is in the US, and their appetite for AI solutions has transformed dramatically just in the last 12 months. But it’s important to remind ourselves that companies very seldom make it to that level.?

To get there, we need great innovation in both the products and the companies themselves to really hit maximum velocity and achieve the level of scale needed to realise our mission.

And the Government has a key role too. Some of the initiatives I mentioned earlier are critical; support on key challenges like privacy will be invaluable too.?

The UK’s status as a legal centre of excellence ... presents a systemic advantage to UK legal tech companies.

For legal tech in particular, it’s crucial that the Government of the day is committed to maintaining the UK’s status as a legal centre of excellence, because it presents a systemic advantage to UK legal tech companies which we need to protect and cherish.

It’s clear that the UK tech sector has big ambitions, and that the Government wants to see them realised - let’s hope we can all rise to the challenge.