There are currently around 600 legal technology companies on Angel List, including law firms and, according to an expert in the area, about 300 companies in the space. As you can see, law firms are not the only industry that makes up a healthy part of the legal tech industry.
I mention this because technology is long overdue in many aspects of the law, particularly on the transactional side of the law. Both case research and the tedious task of combing through endless documents for court evidence lent itself perfectly to the creation of technology earlier than some of the new legal technology companies that help attorneys save time when creating contracts, filing IP registrations, and document review. Because of this, e-discovery and using technology for litigation is more mature than automation on the transactional side.
However, legal matching sites have recently popped up, whose focus is finding affordable attorneys or legal advice for consumers for both family and business needs. Another new trend are companies that allow consumers to practice do-it-yourself filings or registration. Companies have popped up in immigration, divorce, IP, and now company formation.
I met with Mark Oblad at a co-working space in NYC to look at his new platform. Mark is similar to some of my co-presenters at Evolve Law, a former attorney who saw a pain point while practicing and developed a solution. It’s impressive (and rare!) that he is both the legal subject matter expert as an attorney and the developer for his product.
Mary Juetten: What’s the name of your company?
Mark Oblad:Valcu Inc. (A lot of people ask what the name means. The short answer is: nothing—we made it up. We did, however, want to connote both value and calculation).
Juetten: What does Valcu do? What problem are you solving?
Oblad: Valcu operates the web app at valcu.co, which simplifies the process of incorporating and setting up a startup the way Silicon Valley venture capitalists require. Some of the key features of the application are: an extremely easy-to-use interface; a simple process; document generators with Word, PDF, HTML, and text outputs; electronic signatures and coordination with electronic signature packets; data room sharing with co-founders, attorneys, clients, or other trusted persons; and activity logging. We’re also developing a number of additional tools to simplify corporate aspects of running a startup, including a capitalization table maintenance tool, term sheet and financing document generators, and valuation generators.
Juetten: When did you start?
Oblad: I had been experimenting with some of the code earlier, but officially left my job as a startup attorney at Gunderson Dettmer to found the company in April 2013. We had originally set out with the focus on algorithmically generating valuation models for public and private companies. We spent most of a year wrangling the SEC’s XBRL data set and building our valuation models. Along the way, we found that as we developed those tools, we’d have to encompass a number of other products to get where we’re going. So the approach we’re taking is to surface the products one at a time when they’re ready.
Juetten: What's the vision for your company?
Oblad: There is significant amount of time, effort, and money that goes into negotiating and entering into financing transactions, granting options, obtaining valuations, reporting to stock and debt holders, and many other corporate tasks. In most cases, the process is routine, but involves lots of parties, project management, data entry, and in some cases unnecessary negotiation. The Valcu tools are designed to work with all stakeholders (founders and management, investors, attorneys, accountants, bankers, etc.) and streamline these processes as much as possible. We are rapidly integrating and simplifying work around the corporation to build the corporate complement to business’ current use of booking and financing software.
Juetten: Startups are an adventure. What's your favorite startup story?
Oblad: We’ve enjoyed seeing conversations with stakeholders and potential partners evolve. In the earlier stages when the startup is just an idea or code that runs from the command line with no website interface, sometimes the story is hard to tell or it’s less believable. As we’ve built out the products and added features, conversations take a much different tone. Potential users and partners help you tell the story—they think of different features they would find useful, explore different strategies for pricing and approaching markets, and volunteer introductions to hard-to-reach friends.
Juetten: How do you measure success and what is your favorite success story?
Oblad: We see many ways to measure success, but in short they are all measures of value creation, including: shortening the duration of, and/or the amount of time one has to spend completing, a transaction; minimizing the mistakes and variability across transactions; and providing so much value that people get over the barriers of switching and changing their existing processes. As for a favorite success story, I love to watch BuzzFeed grow. They started with a few very smart people experimenting with using technology to identify, create and distribute content that resonates with people. Figuring out how to entertain people and unobtrusively weave in advertising, they’ve built a major technology-enabled media company.
Juetten: And of course, any IP horror stories to share?
Oblad: I think one of the biggest justified fears and risks for sellers of technology companies and their acquirers is drawing attention and costly lawsuits from patent trolls, who go after an easy pool of escrowed transaction funds. Unfortunately, I don’t know a great solution for avoiding these suits, other than to change the laws around patents.
-----
It will be very interesting to see how the field of do-it-yourself legal technology plays out and how some of the lawyers in the legal marketplaces embrace technology to provide services at competitive rates. Even at 300 legal technology companies, the disruption of the legal industry cannot be ignored.
