Hello Divorce Raises $2M to Simplify the Divorce Process

Addressing the Cost Barrier in Divorce Proceedings

The process of divorce is often emotionally taxing and complex, further complicated when financial constraints hinder access to legal assistance. Hello Divorce, an online divorce platform, is being developed to provide a more affordable and expedited solution for couples navigating this challenging life transition.

Securing Seed Funding for Expansion

The Oakland, California-based startup recently announced the completion of a $2 million seed funding round. This investment was spearheaded by CEAS, with contributions also coming from Lightbank, Northwestern Mutual Future Ventures, Gaingels, and individual investors including Jack Newton, CEO of Clio, Lisa Stone of WRG, and Ed Diab of Equity ESQ.

The Scale of the Divorce Industry

Statistical data indicates approximately 750,000 divorces occur annually in the United States. The financial burden associated with divorce varies by state, typically ranging from $8,400 to $17,500. The overall divorce industry is estimated to be a $50 billion market annually.

A New Approach to Legal Counsel

Founded in 2018 by family law attorney Erin Levine, Hello Divorce aims to provide couples with “affordable meaningful legal counsel” and resources that extend beyond simple online forms. Levine asserts that the traditional billable hour model employed by many lawyers is an outdated system for individuals seeking a more straightforward divorce process.

Shifting Control to the Client

“Currently, legal professionals often retain control of information, leading to ongoing costs for clients until the divorce is finalized,” Levine explained. “Divorce extends beyond paperwork; it’s a difficult period where most individuals require support. I identified a significant opportunity to leverage technology and fixed fees to empower couples and reduce conflict.”

Plans for Growth and Innovation

The newly acquired seed funding will be utilized to accelerate the expansion of legal filing capabilities across the U.S. The company also intends to enhance its existing product and provide consumers with more comprehensive content and services to navigate their divorce with confidence.

Affordable and Remote Legal Services

Hello Divorce offers a range of services, including a do-it-yourself option starting at $99, and comprehensive legal assistance for an average of $2,000. This allows couples to complete the divorce process in approximately one-third of the time, all conducted remotely.

Addressing Fears and Access to Justice

Levine notes that many individuals spend between two and five years considering divorce, often hindered by concerns about affordability and potential impacts on their children. Approximately 80% of those contemplating divorce are unable to access legal representation.

Leveraging Venture Capital for Infrastructure

Despite already achieving profitability, Levine sought venture capital to build a robust infrastructure and benefit from the expertise of investors like CEAS and Eric Ong of Lightbank. She acknowledges the importance of recognizing both her strengths and areas for development.

Investor Perspective: A Unique Value Proposition

Ong stated that he was introduced to Levine through fellow investors who highlighted the potential of Hello Divorce. Lightbank focuses on investing in companies that are defining new categories, and he was impressed by Levine’s vision and her team’s approach.

Disrupting the Traditional Model

“A significant portion of individuals still lack adequate legal representation,” Ong commented. “We sought a technological solution that would deliver substantial customer value, and Hello Divorce stood out as the clear choice.”

Expanding Service Availability

The seed funding will also support the expansion of legal filing options nationwide, as well as ongoing product development and the creation of new educational content for users.

Strategic State Launches

Currently, the service is available in California, Colorado, Texas, and Utah. These states were selected strategically, with California offering Levine’s familiarity with its laws, Colorado presenting a complex divorce system, Texas lacking streamlined processes for same-sex couples, and Utah implementing a new regulatory framework. Future expansion plans include New York and Florida, with a bilingual service offering in the latter.

Demonstrated Growth and Pandemic Impact

Since its inception in 2018, Hello Divorce has experienced 100% year-over-year growth, boasting a 95% success rate for couples initiating the divorce process through the platform. The company also saw a surge in inquiries during the past year, with approximately 2,000 individuals seeking guidance on navigating separation and co-parenting during lockdown.

Long-Term Effects of the Pandemic

“We observed an increase in questions regarding whether to stay or leave, and what the divorce process would entail,” Levine said. “The full impact of the pandemic on divorce trends will likely unfold over time.”