A Bay of Plenty startup that created a whole new category of software - a cloud-based system organising in-house legal teams - has just landed another wheelbarrow load of venture capital.
The Tauranga-based LawVu has raised $20 million in a "Series A" extension - taking its current fundraising round to $37m and its total venture capital funding to some $45m.
Chief executive and co-founder Sam Kidd says the funds will be used for product development, and to boost staff numbers from 120 today to around 180 by year's end.
Kidd sees most of the hires in Tauranga - or working remotely from elsewhere in NZ - as the startup keeps most of its R&D local. But it will also be adding sales staff in the US and other key markets.
The CEO isn't disclosing any financials. But he says revenue doubled last year. And the firm's performance was sufficiently impressive to attract the New York-based multinational VC outfit Insight Partners, which lead the $20m Series A top up. The round was supported by one of LawVu's existing investors - Australia's AirTree Ventures.
LawVu has recently signed a number of big customers, Kidd says, including AMP and the NYSE-listed Dutch Bros - a fast-growing Starbucks competitor that now has 538 locations in the US and a US$8.5 billion market cap.
But he adds that an equally important trend is that existing customers - including one of the giant social media platforms in the US, Telstra in Australia, and Fonterra, Zespri and Sky TV at home - are "doubling down" on his firm's cloud-based service.
"We're also getting a lot of traction on the US West Coast tech scene," he says.
Kidd and co-founder Tim Boyne got the idea for their startup when both were working in and around corporate NZ in the early 20-teens, Kidd for a startup that integrated accounting software with IRD's systems, Boyne as an IT operations manager at a law firm.
While lawyers have a raft of technology options today, Kidd and Boyne saw a gap in the market for in-house legal teams within government agencies or large companies like Zespri.
"Often in a big firm, there's a lot of repetitive legal work, or sometimes the left hand doesn't know what the right hand is doing," Kidd says.
The pair thought in-house legal teams needed their own software platform, just as salespeople had Salesforce.
"Our platform is finally offering a way for not only legal teams but also management to see how the legal function is performing inside their company," Kidd says.
While dedicated law firms or large corporates had (often pre-cloud) ELM (enterprise legal management) software, it was complicated and often required a big implementation team. In 2015, Kidd and Boyne set out to create a cloud-based, user-friendly alternative.
Tauranga City Council became LawVu's first customer, and something of a test-bed. Dunedin City Council came next, followed by top-tier corporates.
The cost of LawVu's cloud-based service depends on how many modules you subscribe to; they cover areas including creating contracts, collaboration and sharing documents. Its platform can work with a range of other software, including Outlook and e-signature service DocuSign.
Kidd says a Series B round is next on the agenda, which is likely to be in the $30m to $50m range.
He puts the value of the overall legal tech market at US$50 billion.
The CEO won't disclose his firm's private equity value today. But it will be well north of the mark set in 2020, when LawVu raised $2.5m from AirTree at a $20m valuation.
"From day one, we recognised LawVu's potential for high-growth and global expansion as they were offering a disruptive solution to the legal industry and its traditional ways of working," says Insight Partners MD Rachel Geller, whose firm's previous punts include early investments in the likes of Shopify, Twitter, Adobe Sign, DocuSign, Mimecast and Trivago.
"We're thrilled to be strengthening our commitment to LawVu as it continues to provide a best-in-class experience for in-house legal teams globally. We look forward to our partnership as they continue to scale up."
Staying in the Bay
LawVu currently has around 70 staff in NZ, and most of the rest spread between hubs in the US and Australia.
Kidd says while he's angling to keep "the lion's share" of R&D work in Tauranga as LawVu goes on its latest hiring drive, "It's an interesting dynamic trying to work out how much office space we need. The whole talent acquisition side is super competitive now and people are picky about where they work. So we're keeping it fluid".