Clio Secures $110 Million in Series E Funding

Clio, a company specializing in cloud-based software for legal practices, announced on Tuesday the successful completion of a $110 million Series E funding round.

This funding was co-led by T. Rowe Price Associates Inc. and OMERS Growth Equity. The investment elevates the Vancouver, British Columbia-based company to a valuation of $1.6 billion, achieving unicorn status.

Funding History and Market Position

Clio’s previous funding round occurred in September 2019, raising $250 million in a Series D financing.

With this latest capital injection, Clio asserts its position as the “first legal practice management unicorn” on a global scale. The total capital raised since the company’s founding in 2008 now totals $386 million.

Origins and Mission

Founder and CEO Jack Newton, alongside Rian Gauvreau, established Clio during the 2008 recession.

They observed the challenges faced by solo practitioners and small law firms in managing their businesses. Traditional legal practice management software was largely geared towards larger enterprise clients, leaving a gap in the market.

Clio was created to address this unmet need, providing solutions tailored for smaller legal operations.

A Platform for the Future of Law

Newton likened Clio’s impact to that of Microsoft Windows for personal computers.

He stated that Clio has developed a cloud-based software platform specifically designed for law firms and their clients, prioritizing a client-centric approach.

The company’s platform functions as an “operating system” for legal professionals, offering tools for legal practice management, client intake, and legal CRM.

Customer Base and Reach

Clio currently serves over 150,000 customers across 100 countries.

While many users are solo practitioners and smaller firms, the platform also supports larger organizations like Locks Law and King Law.

The company aims to enhance productivity, facilitate firm growth, and improve accessibility to legal services.

Growth and Financial Performance

Newton indicated that the company has experienced “explosive” growth since its 2019 funding round.

This growth was significantly accelerated by the shift towards digital solutions prompted by the COVID-19 pandemic. He described the current valuation as “fair,” resulting from a comprehensive evaluation process.

Focus on Innovation and Accessibility

Clio has concentrated on developing its core technology, particularly within an industry historically reliant on manual processes.

A key objective is to make legal technology more affordable and accessible for lawyers.

The Impact of COVID-19

The pandemic compelled law firms to reassess their operational models and service delivery methods.

Storing client data on-site became impractical with the rise of remote work. Lawyers who had previously resisted technology adoption were compelled to adapt quickly.

Newton believes this shift represents a lasting change in the legal landscape.

Strategic Acquisitions and Future Plans

In 2018, Clio acquired Lexicata, a legal tech startup based in Los Angeles.

The company intends to pursue further acquisitions utilizing the new capital. Investment will also be directed towards platform development and strategic partnerships (currently exceeding 150 integrations).

Expansion and Hiring

Clio plans to increase its headcount by 40%, adding 250 employees.

The focus will be on strengthening the product and engineering teams. The company currently employs 600 individuals.

Newton stated the company’s goal is to “completely redefine the way legal services are delivered and democratize access to legal aid by way of the cloud.”

Geographic Expansion

Clio is experiencing growth in the EMEA markets, with a particular focus on the United Kingdom and Ireland.

Investor Confidence

OMERS Growth Equity managing director Mark Shulgan expressed his firm’s long-standing interest in Clio.

He stated his belief that Clio has firmly established itself as a leader in the legal tech sector and is poised for continued growth in the coming decades.