A software company that helps law practices run more efficiently may not be the flashiest business in town, but that’s not stopping some VCs from backing them with pretty high dollars.
Hence, Canada-based Clio (which provides that type of software) announced this morning it has raised a massive $250 million Series D round from TCV and JMI Equity. Clio’s platform aims to serve as “an operating system” for lawyers, offering cloud-based legal practice management, client intake and legal CRM software. The company has 150,000 customers across 100 countries.
The financing is roughly ten times the amount of venture funding that Clio had previously raised since it was founded in 2008. The company’s Series B in January 2012 amounted to a comparatively small $6 million. In 2014, Clio raised $20 million in a Series C led by Bessemer Venture Partners that valued the company at $110 million, according to Crunchbase data. The company raised a $1 million Series A in 2019 from friends and family and Christoph Janz, who was also an early investor in Zendesk and contacted Clio via a cold email after finding the company on the internet, according to Clio CEO and co-founder Jack Newton.
The new round is “one of the largest in legal technology and the largest in Canadian history,” according to Clio.
Newton said his vertical SaaS company helps legal professionals be more productive, grow their firms and “make legal services more accessible.” It also aims to help clients find lawyers more easily and vice versa.
In its first 10 years of operation, Clio has focused on building out its core technology to an industry that continues to rely on pen and paper in many cases. It has also aimed to make legal technology more affordable for lawyers to use.
Following the news, I spoke with TCV Principal Amol Helekar this morning. Helekar will join the company’s board along with TCV General Partner Jake Reynolds. He said his firm views Clio as the clear market leader in the legal tech space, which Helekar believes is “underused relative to the potential demand in the end consumer base.”
“This is a vast industry that has been lagging in technology adoption and there’s tons of opportunity,” he said. “We see Clio as a pioneer in cloud-based tech solutions for the legal industry that has seen exceptional organic growth.”
Helekar likened Clio’s trajectory to that of previous TCV investments such as Netflix, Expedia and Spotify.
“We feel like this investment can help supercharge the business so the company can double down and expand its advantage and capture share in a market that hasn’t yet adopted technology in a big way,” he told me. “They’ve been very capital efficient but this kind of capital can help them invest in go-to-market, build out their sales team and invest in a lot of product in addition to the suite they currently have.”
Last year, Clio made its first acquisition with its buy of Lexicata, a Los Angeles-based legal tech startup. The company plans to do more acquisitions with the capital, according to Newton. It also wants to accelerate product development in general and continue integrating with more apps. Since the company made the decision five years ago to expand its functionality through integration (it currently has partnered with over 150 apps), the company has seen accelerated growth, Newton said.
Speaking of growth, Newton would not provide any revenue numbers but said the company was scaling “rapidly” and had “roughly doubled its number of employees” to over 400 in the last two years. He also declined to comment on valuation.
The company also announced today that Mark Britton, who founded legal marketplace Avvo (which was recently acquired by Internet Brands), is joining Clio as an independent board member.