Ask HN: Why are there so few law startups?

There are companies that provide legals docs to startups as a service. These are generally a bad idea to use. For example, I used a popular one a few years ago and got a general, 2-page document. I went to a real lawyer and got a 50-page document that served me well later, when my company needed to liquidate.

One of the problems is that the cost of having a bad legal team (or no legal team) is astronomical. It's far higher than just paying the "high fees".

What kinds of areas would you want to innovate specifically?

One that I remember coming across is https://www.shakelaw.com/

Cant give insight as to why that industry seems particularly more quiet than others in terms of disruptive business models however

Here are some law startups:

www.hireanesquire.com www.plainlegal.com www.InCloudCounsel.com www.casetext.com

There are quite a few law startups with legal practice SASS offerings, b2c marketplaces, document management. You likely haven't heard of these unless you're a lawyer, and even then it's not likely. How many dental startups are you following? None, I'm guessing.

Here are some law startups:

www.hireanesquire.com www.plainlegal.com www.InCloudCounsel.com www.casetext.com

There are quite a few law startups with legal practice SASS offerings, b2c marketplaces, document management.

Startups practicing law (rather than providing law-related services other than legal practice) are difficult given restrictions on the practice of law, including legal ethics rules (e.g., things like ABA Model Rule 5.4(d) [0].)

Also, while in other industries if you break the rules of the industry the corporation pays a fine (which is part of the risk of a startup) and the principals all move on with their lives and livelihoods.

Lawyers who break the rules of their industry can be disbarred. While this doesn't completely stop all move-fast-and-break-things in the field, it does limit the willingness of people in the field to engage in it.

Another factor may be that purchasers of legal services tend to be looking to mitigate risk by purchasing those services, which may make them reluctant to consider novel and unproven models.

[0] http://www.americanbar.org/groups/professional_responsibilit...

Clio is the only one I know of off the top of my head. https://www.goclio.com/

Here is a law startup: https://lexmachina.com/

I thought https://www.docracy.com was disrupting that space. Isn't it?

Another interesting one: https://www.judicata.com

I think this is by the guy that posted those great class notes originally for Peter Thiel's Startup Class (which then became a book I believe).

I know of one in Australia https://lawpath.com.au/

The other area to disrupt IMO is accounting services.

Another one that was posted on HN recently was https://www.lawgeex.com/

Angellist ranks close to 900 legal startups (https://angel.co/companies?markets[]=Legal)

but most of them are in fact only partially legal or "meta legal" in the sense that they do not offer legal advice. There has been going on a lot of discussion why legal discruption or innovation do have such a hard time. One of the most important reasons is linked to the matter as such: math, logic and algorithms are apt to create complex logical structures but remain semantically simple. legal rules are simple in terms of logic but semantically complex.

The very few startups actuelly working the automation field (neota logic, lexalgo) have a hard time finding sufficient real live cases to get their hands on.

Well, it depends on what you mean by "law startup."

There are plenty of document-processing startups that help with what lawyers call e-discovery. There are also some startups that will help you do some standard legal tasks, like incorporate in Delaware and issue stock. I think one of those is Clerky, a YC-funded company. Avvo is a matchmaking/profile aggregation startup that comes to mind.

I worked with Fenwick and West to incorporate https://recent.io/, in part because I've had a relationship with them for a few years. But I see why people today use Clerky and pay ~15% as much.

A few other thoughts:

* Lawyers are some of the most conservative and risk-averse professionals you'll find. So it will take a while for any newfangled innovations to become adopted.

* Those "enormous fees" are already being whittled down as part of a multi-decade shift away from Big Law in its traditional form, including fixed fees rather than hourly rates.

* Bar associations act as a cartel and try to restrict competition. Nolo, which publishes self-help software and books, was actually sued for daring to compete with lawyers ("Unauthorized Practice of Law"): http://blog.nolo.com/blog/2011/04/11/the-brief-story-of-texa...

* When you want tailored advice, a website with a bunch of forms (even forms created by smart lawyers) is likely insufficient. I know one trust attorney in the SF bay area who told me she had to figure out how to handle cryopreservation after some Silicon Valley execs wanted it; that required original research. When you're in a situation where mistakes can cost you millions, hiring an attorney for tailored advice is cheap insurance.

regulations

lexisnexis and westlaw got this space locked down.

some interesting attempts:

https://www.ravellaw.com/ (active) https://www.judicata.com/ (stillborn/dead) www.tabulaw.com (dead)

I'm the lead developer at Contractually (a Vancouver-based startup): http://www.contractual.ly. We take contracts out of Microsoft Word and email and put them in an online format that understands the business data and process that is involved. We're solving problems form the low level (version tracking, redlining, commenting) to the high level (renewal reminders, workflows, tagging, reporting). We're currently focussed on large businesses and enterprise.

To answer your question, there's not many startups in the legal space because people and businesses are really worried about their contracts. The conservative nature is one that needs to slowly be eroded, and that's where we're at now. E-signature providers have taken away a lot of concerns and we're starting to see opportunities in areas outside of just signing.

At Contractually, we're seeing more competition (a good thing, of course) targeting small businesses right up to enterprise. Typically, they solve some small part of the contracts problem: Assembling documents, or e-signatures, or workflows, etc. The competition isn't just coming from startups (e.g. glider.com, acquired last year), it's also coming from large incumbents (e.g. Merrill DataSite for contract management, launched last month).

It's an exciting time and I think we'll start to see big chunks of the problem solved over the next few years.

I'm jurist cum developer in Belgium, I spent a decade in this niche:

* Jurists are used to face extraordinary difficulties when researching things. Throw them a monstrous contractor-built Adobe Flex application as a search engine, and they'll be all the happier: still better than hundreds of paper volumes. The erudite knowledge of where and how to search is part of their expertise.

* In their mind, it's the content that matters. The form may be prettier and easier to use, they will hardly notice. As a law student, we had to read and print things presented like this (and this is a extremely gentle example): http://goo.gl/6Uz48Q Years later, I built my own app, where the same content is presented like this (see print preview to see what a little interest in the subject can produce) : http://www.etaamb.be/fr/2015201838.html It doesn't get noticed a lot, although it attracts a lot of visits.

* The sector is cornered with not too innovative academics and conservative publisher companies with vested interests, even more conservative public institutions and associations (lawyers, notaries,... ) and extremely conservative laws. Kickstarting something like an internet app for last wills and testaments without the support of most of them is impossible (been there, done that): there is no place for disruption without institutional support.

* Speaking of institutional support: I only managed to implement an electronic proceedings platform in Belgium (still the only one) because I happen to work at a federal institution. It's been instituted by way of Royal Decree: not really the same as the apple store. It was a fortuitous meeting of ambition and competence: in other settings contractors have to be engaged, of which only the cheapest get selected, resulting in utter crap and millions of wasted taxpayer's money.

* It's very country-specific. Laws and customs stop at national borders, not even speaking of fragmented federal states and small legal districts. You could write a successful app in your country, but other countries have their own hurdles, not event speaking of the not-invented-here bias (As far as I know, technological exchanges are virtually non-existent, even between countries who share a common judicial structure).

Plenty of other stuff in my mind, but still, the sector is ripe for improvement; the internet revolution has just started reaching the outskirts of the legal world. The ways laws are voted, how proceedings and courts work, how doctrinal knowledge is made available and legal professionals joinable, there's plenty of low-hanging fruit. Fruit regulated by state law and pretty tenacious customs ;)

Perhaps pay and lifestyle are already very good, why bother risking that for a startup that might fail or will, at the very least, cost a lot of time.

That and the probably rather conservative nature of people in this profession are probably some of the reasons.

We at Beagle Inc (http://beagle.ai) are building a product that uses NLP to make contracts easier to understand, bringing comprehension from 0 to 80% in seconds. There's also a collaborative piece which allows you to make critical changes and see redlines. I'd say our analysis focuses on a relatively different problem than other legal tech startups are addressing. Its been a substantial technical challenge to bring our analysis quality to a good level and its constantly improving. Aside from that, law can be a relatively daunting space, so I believe that having a leader who knows their way around the law (and tech) is critical. I'd suggest that these personalities enjoy well-paying jobs at law firms and a special few would consider the startup route.

Startups generally solve pains that the founders have experienced. To experience the pains of the legal profession you need to have worked in it for a while, but if you've done that then you're probably already quite well paid and maybe see the paperwork as a necessity. Or at least see it as something that you can charge a lot for. In short, there aren't many law startups because the people who suffer what we regard as a pain don't see it as a pain.

I suspect that it is because law service advocates (and most professional groups) fiercely protect themselves through licensing and watch-groups (normally "boards").

If you would like to prove this to yourself pull up your state (not CA, CA is weird) statutes concerning attorney licensure and read the entry and maintenance requirements to "join the club". You will find them draconian and easily withdrawn for minor offenses.

You will see this in all groups that have advocates from lawyers to hairdressers. It is self-preservation.

I think law startups is a vague term that can account for many points of view. Startups for people 'using' the law or startups for those 'practicing' the law.

For the past few years I've been making apps such as iJuror (http://www.ijurorapp.com) specifically for attorneys and law firms. Adoption has been pretty significant but the industry is a bit more conservative when it comes to technology. Other apps such as TrialPad and TranscriptPad have been successful as well.

ClearView Social (http://clearviewsocial.com) is another startup in the legal space that helps attorneys and law firms grow their presence on social media.

I think we'll see more startups in the space in the coming years too.

People are not too keen on betting the future of their company on a startup that may or may not be still around in 3 months to save a few bucks.

I'm an ex-lawyer and co-founder of Dragon Law (www.dragonlaw.com.hk). We're based in Hong Kong, the legal hub of Asia. We'll be launching in Singapore in a month or two's time.

Our online contract automation tool allows business owners to create their own legal documents, have them reviewed by a lawyer, and signed electronically.

Check us out! Happy to hear feedback from you all!