The confidence of the people in the legal tech industry in the U.K. and beyond to weather Brexit is apparent in a number of ways, from how they operate in the market to the tools they develop. Below are four of these tell-tale signs that highlight how it's business as usual in legal tech:
1. Legal Technology Companies Are Expanding Into the U.K.
Nothing expresses confidence in a country more than opening up a local office. And far from cowering away from the U.K., legal tech companies have been doing exactly that.
E-discovery managed services firm Fronteo, for example, recently established its new international subsidiary Fronteo EMEA (Europe, Middle East and Africa) in London and opened an e-discovery review center in the city that specializes in data forensics, preservation and processing, and predictive coding services.
James MacGregor, vice president of European e-disclosure services at Fronteo, told Legaltech News that a big focus of the new offices will be the U.K. market itself. "As the market continues to build in the U.K., there will be [an] increasing appetite for managed services, and Fronteo is now strategically positioned to capitalize on this primary market."
Like Fronteo, SharePoint-based products provider Handshake Software also recently expanded its presence in the country by partnering with U.K.-based Enable Business Solutions, who will resell, install and repair Handshake's products in the country.
Glenn LaForce, senior vice president and chief strategy officer for Handshake, told Legaltech News that the fact that Brexit happened "doesn't change that the lawyers over there need products to facilitate their business decisions and enable their practice."
2. The Market for U.K. Legal Tech Companies Remains Strong
Legal tech companies aren't just opening new offices and services in the U.K., they're buying up local companies as well.
Mitratech, for example, recently acquired risk management software provider CMO Software and information governance solution provider HiTec Laboratories, both based in the U.K. The move underscored the market for U.K. tech businesses, which far from being stunted by Brexit, have come away relatively unscathed.
Matt Stamp, a partner at Acuity Advisors and adviser to HiTec during the acquisition, told Legaltech News that the local tech market is "as robust as it was" before Brexit. "It's got a lot of money invested in it from institutional investors and private investors," he said.
He added that a larger factor in the market is interest by U.S. buyers who are drawn to the U.K. legal tech ecosystem because they find it relatively easy to navigate the country's culture and regulations.
"When you consider legal technology, you need to be aware of key differences in the compliance or regulation environment," he said. "There are always going to be quite significant regional differences, but there is more of a commonality between the U.K. and the U.S. than there would be if you jump into France or Germany or Spain."
3. U.K. Companies Are Preparing for GDPR
A survey of over 800 corporate IT professionals across the EU, U.K. and U.S., conducted by IT community organization Spiceworks, found that U.K. companies were ahead of their counterparts in preparing for and understanding the impact of the EU's upcoming General Data Protection Regulation (GDPR).
The findings show that despite Brexit, legal tech companies in the U.K. are still planning to handle and manage EU citizen data that is subject to GDPR oversight and play an active role in the international legal tech market.
Peter Tsai, a senior technology analyst at Spiceworks, noted that in part, more U.K. companies were focusing on the GDPR now so they could free up their compliance efforts for any upcoming new local regulations or laws once the U.K. leaves the EU.
But he added the U.K.'s GDPR preparation is also a result of the fact "there aren't as many consultants that are up to date on, and could help with, GDPR compliance" in the country, so U.K. companies have to be more informed about the regulation on their own.
4. Brexit Risk Is Being Addressed Through Innovation
Leave it to legal tech pioneers to turn to innovation to quell their Brexit anxiety. Law firm Mayer Brown, for example, recently launched a Brexit assessment tool to help companies understand the specific risks they face operating in the U.K. after it leaves the EU.
A Mayer Brown representative explained to Legaltech News that the tool "looks at a range of high-level issues that we believe businesses need to consider in light of Brexit; for example, major ongoing or future investment decisions, supplying cross-border goods and services, and EU grant funding."
The tool then ranks the importance and impact of these business issues, which also include contractual liabilities, data protection and privacy issues, and regulations, as well as estimates the amount of resources addressing risks may require.
In addition to the tool, Mayer Brown also launched a knowledge hub, which the representative noted strived "to cut through the Brexit noise" and offer insight on relevant developments on Brexit negotiations.
Contact Rhys Dipshan at rdipshan@alm.com. On Twitter: @R_Dipshan.
