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“UK is a global leader in legal technology, but we are not alone” – Society president warns industry leaders
Research conducted by the Law Society of England and Wales indicates UK legal technology will need continual investment to stay on top – with other jurisdictions seeing strong growth in their domestic sectors.
These are initial findings launched at Legal Geek Conference 2019 in Central London on Wednesday 16 October.
The global market in legal technology, or Lawtech, is growing rapidly and is valued at $15.9bn – and new research published by Thomson Reuters today shows investment in UK Lawtech has increased threefold in the past year to £61 million, with Britain home to nearly half of companies.
The adoption of new technologies could increase productivity growth in the legal sector from 1.3% per year to 2.7% per year. And every £1 spent on legal services supports £1.39 in spending across the entire UK economy - a contribution that could be boosted by investment in Lawtech.
Law Society president Simon Davis said: “Our research shows the synthesis of ‘law’ and ‘tech’ is establishing the UK as a global leader. Our leadership in lawtech will bring economic benefits, but it will also further establish our reputation as a global legal centre.
“London is becoming a hub for legal technology, with the capital topping the European investment charts for funding into fast growing sectors such as artificial intelligence, cybersecurity and FinTech.”
Although investment in UK Lawtech is likely to increase in the near future, he warned: “The gap between the UK and its closest competitors is too close for comfort.
“Furthermore, UK Lawtech lags behind other fields of digital disruption, such as FinTech – where funding and regulatory alignment is much more advanced.
“Further investment and strategic support will be needed if we are to maintain our competitive edge in the global market.”
We will be releasing the full comparative analysis of the UK’s Lawtech market and other jurisdictions, with comprehensive recommendations, before the end of the year.
Investment in UK Lawtech is likely to increase. Global investments in Lawtech currently stand at $926 million. While the UK Lawtech market is still at an embryonic stage, the value of investment in the sector shows encouraging levels of backing by venture capital firms, angel and seed investors.
Lawtech remains less mature than other fields of digital disruption, most notably Fintech where funding and regulatory alignment are more advanced. Growth areas of Lawtech include: legal analytics; legal project management; governance and compliance; and contract management. More established areas include: collaboration tools; document management; IP management; and e-billing.
London is becoming a hub for legal technology. Global tech investors are drawn to London for its strengths in developing the latest cutting-edge technologies, with the UK capital topping the European investment charts for funding into fast growing sectors such as Artificial Intelligence, cybersecurity and Fintech. London ranks close to the San Francisco Bay Area in three specialist markets for AI suppliers: insurance, legal and education.
The UK is playing a significant role on Lawtech in the worlds’ stage. The closest competitors are Singapore, Hong Kong and the Netherlands. Although the UK leads in some aspects it is lagging in others and overall the gap between the UK and the competitor nations is not large, meaning that in order to, as a minimum, retain our position we are likely to need to invest, and more so if we aim to seek to improve competitive edge.
The most established Lawtech products in the UK are target eDiscovery and legal Research. Contract management is ripe for explosion in terms of legal services market interest (especially B2B and in-house) and as an attractive investment. We will see these individual Lawtech product types merge as start-ups work together to offer blended solutions, further pushing what tech can achieve the legal services sector.
About the Law Society
The Law Society is the independent professional body that works globally to support and represent solicitors, promoting the highest professional standards, the public interest and the rule of law.
Press office contact: Liam McCafferty | 0208 049 4028