Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More
The 16-year-old Canadian legal software firm Clio, which makes a cloud-based operating system for law firms that handles everything from client intake to court filings to accounting, announced today that it has raised $900 million in a Series F investment round.
This massive round was led by New Enterprise Associates (NEA) and values the firm at a total of $3 billion. Clio is touting it as the largest transaction ever in cloud legal technology, and says the money will be used to further advance its tech offerings with AI and other features, as well as expand to new markets and firms. It already counts customers in more than 130 countries, though the majority of its 150,000 individual users are in the U.S.
“We’re able to dramatically simplify workflows and unify them into one system,” said Jack Newton, CEO and Founder of Clio, in a phone interview with VentureBeat. “We put law firms of all stripes, all of the data of each firm, in their own centralized, secure system of record that they depend on as their source of truth.”
The Series F round saw participation from Goldman Sachs Asset Management, Sixth Street Growth, CapitalG, and Tidemark, joining current stakeholders TCV, JMI Equity, funds and accounts advised by T. Rowe Price Associates, Inc. and T. Rowe Price Investment Management, Inc., and OMERS.
Tony Florence, Co-CEO at NEA, who has joined Clio’s Board of Directors, commented in a press release: “Clio embodies everything NEA looks for in a growth-stage investment: an exceptional, purpose-driven team, market and product leadership, and stellar business physics. Clio is mission critical to law firms, and the company’s best-in-class retention and NPS are testaments to the team’s ability to continuously innovate, deliver immense value, and meet the dynamic needs of the legal sector. With the right foundation in place for continued market expansion and advanced AI capabilities, we believe the best is yet to come.”
Investment in AI and new features
Clio plans to invest further in its burgeoning AI portfolio and integrated legal payments.
Recently, the company announced Clio Duo, a proprietary generative AI solution designed to help lawyers complete routine tasks and leverage firm analytics for more efficient practice management.
Clio Duo includes audit log functionality for court discovery, enhancing legal practice efficiency.
“We’re all in on AI,” said Newton. “We’re weaving it into many different areas of the product…it’s something we’ve been investing in since the earliest days of large language models over a year and a half ago.”
He pointed to the launch of ChatGPT in November 2022 as the key turning point for interest among customers in AI, as it was for many industries. He also noted his own background was in machine learning.
At the same time, Newton acknowledged that “there’s a lot of anxiety around AI replacing lawyers among our customer base…but we really perceive the power of AI is to amplify them so that they’re able to dramatically increase their productivity, and position them to better serve the huge amount of unmet legal demand.”
Newton added that statistics available to Clio showed that 77% of current legal issues annually are not served by lawyers — with people going to other experts or simply going it alone to solve them, also termed as the “justice gap.” He said that AI would help lawyers by giving them more time to find and serve more people who are currently doing without representation.
Additionally, Clio offers Clio Accounting to manage firm finances, ensuring compliance, and a module specifically for personal injury lawyers, providing rapid settlement estimates for high-volume case assessments.
The platform also includes Clio Draft for intelligent document automation and court form libraries covering more than 50 jurisdictions, as well as electronic court filing services to streamline court interactions.
Security is paramount
Obviously, the legal sector is among those that have a consistent and dire need for security — by the very nature of dealing with confidential material before trials and filings, whether it be pertaining to individuals or organizations and their goings on.
Amid the recent outage of security provider CrowdStrike that left millions of airport travelers stranded and bank customers frustrated, questions have swirled throughout the tech and business worlds about enterprises being overly reliant on cloud software companies.
But Netwon says Clio understands these concerns and takes security extremely seriously and has since the start.
“We’ve made a very significant investment in security and compliance, and operate a dedicated security team that is larger than some of our competitors and their development team,” the CEO told VentureBeat. “We’re able to provide assurance to our HIPAA regulated customers [Health Insurance Portability and Accountability Act — pertaining to healthcare firms]. That’s something we’ve invested in since day one of our technical investments.”
A winning streak
Clio’s growth since its Series E funding in April 2021, which raised $110 million, has been remarkable. The company has exceeded $200 million in annual recurring revenue (ARR) and expanded its international footprint to the APAC region. Its all-in-one payments business, launched in 2022, now processes billions of dollars annually in legal-specific transactions.
Clio’s workforce has grown to over 1,100 employees, with hubs in North America, EMEA, and APAC regions. The company continues to hire across various areas, including product development, R&D, sales, marketing, and customer success, to support its expanding operations.
A history of innovation
Since its inception in 2008, Clio has made a major impact on the legal technology landscape. After recognizing the challenges faced by solo practitioners and small law firms, founders Jack Newton and Rian Gauvreau aimed to bring the practice of law to the cloud.
Clio has hosted 10 Clio Cloud Conferences, presented 32 Reisman Awards, and published seven Legal Trends Reports. It is recommended by over 100 bar associations and law societies and has added more than 200 partners to the Clio App Directory. Clio also offers an Academic Access Program, providing free software to over 55,000 users at more than 200 schools.
Source link
