During my own startup adventures, I came to the conclusion that, succeed or fail, the only people guaranteed to make money are cloud providers and lawyers. With regards to the former, pricing and competition is fairly transparent. But legal fees, not so much. That’s the problem UK startup Lexoo has set out to solve.
To help with that mission, the London-based company, which offers what it calls a ‘lawyer-matching’ service, has just scored a $400k seed round from Forward Partners — the venture firm and startup ‘foundry’ headed up by Nic Brisbourne — and Jonathan McKay (Chairman of JustGiving).
“It’s difficult for small businesses to find a good lawyer and not get overcharged in the process,” explains Lexoo co-founder and CEO Daniel van Binsbergen, who previously worked as a lawyer focussing on finance and M&A. “Brand name law firms are usually great but have a lot of overheads and therefore high hourly rates. With smaller firms it is hard to know which lawyers are actually good and specialised. Finally, if you go with a recommended lawyer it is hard to judge whether the price you are quoted makes sense or not.”
To tackle this — in what can be considered a classic example of how markets can be made more efficient and transparent by moving them online — Lexoo enables businesses to get multiple quotes from a curated line-up of lawyers, based on the type of work required. After posting a job, you receive multiple and competitive quotes from the qualified lawyers on the platform, usually within 24 hours.
“We make sure that only lawyers who are actually specialised in a certain area of law are invited to quote for a job and we screen and interview every single lawyer before they can join the platform,” says van Binsbergen. “Customers can then compare the quotes and lawyer profiles and make a much more educated decision. Our sweet spot is finding lawyers who trained at the largest firms but for lifestyle reasons are working at home, virtually or in a small office. This enables them to usually charge only 50 per cent of their previous hourly rates.”
To that end, Lexoo is free for clients, but lawyers pay the startup a 10 per cent commission on any work they obtain through the platform.