Legaltech’s long road to innovation
The CEO of a start-up specialsing in enterprise discovery shares the story of how his company has matured on the track to innovation to join the Nextlaw portfolio of companies endorsed by Dentons.
Canada-based Chris Perram (pictured) landed in Sydney last week to participate in a panel hosted by Dentons as part of its innovation start-up initiative.
Speaking to Lawyers Weekly about the evolution of his B2B SaaS company FileFacets, the information governance expert discussed the ambit of legaltech providers now entering the market.
On one end of the scale there are companies such as Beagle, with clients of the likes of Westpac, that offers machine learning contractual review. Beagle’s software has the capability do a detailed analysis of contracts, clause by clause, and check the content for compliance with regulations and broader contractual obligations.
“It’s a really neat mix in the Nextlaw portfolio of firms that are doing really big data stuff, like big enterprise analytic stuff; and really granular detailed analysis, at the word, sentence and paragraph level of a contract,” Mr Perram said.
Mr Perram is the CEO of FileFacets, one of the companies backed by Denton’s innovation portfolio Nextlaw Labs. The initiative is part of the global law firm’s efforts to strategically invest in companies that it identifies as being able to transform the legal landscape.
“What we do is index all of the unstructured content in an organisation and apply machine learning and AI to every object in the enterprise.
“We can go in, very quickly index several tens of millions of files in an organisation and identify all of the contracts and the invoices or the employee records to expedite the discovery phase of a due diligence exercise. We’re getting some really great traction with that use case inside legaltech and fintech,” Mr Perram said.
The start-up’s offering was informed by his long background in the information governance space, Mr Perram said. His company was first established with the original business objective of data management at the enterprise level, catering to clients in heavily regulated sectors such as mining, resources and energy.
Mr Perram explained that in 2015, a decision was made to transform the business into a software company. Nextlaw’s investment came soon afterwards and FileFacets has been a part of the global law firm’s portfolio for nearly a year.
“Our view of the world has always been at the enterprise level. We were mostly around information governance and doing meta data extraction and auto-classification. Then we pivoted from that to where we are today,” Mr Perram said.
“We identified that in fact, one really big missing piece was that ability to find and identify all the content across an organisation, regardless of where they are in the world.”
The CEO said that in making the transition from servicing very industry-specific clients, most of whom were large corporations subject to strict environmental compliance rules, the firm had to learn to refine its offering to adapt and appeal to a broader market. This evolution involved unpacking what was a very effective but technical conversation about the product being offered.
Mr Perram said that there was a lesson for start-ups to learn from his company’s experience maturing in the innovation space.
“Especially in a world like this in the AI space where the sky’s the limit and no one really knows where it’s going, there is always somebody that is pushing the envelope,” Mr Perram said.
“Invariably, you end up with solving a problem that didn’t really exist. So you have created this great solution and didn’t go hunting for a problem,” he said.
In the case of FileFacets, Mr Perram said that the company realised it needed to tweak its product in order to better service a broader market. That spurred the company to evolve, he said.
“We built this great solution for a really small, powerful subset of businesses out there. [Smaller] prospects we were talking to were taking the product and carving off the bits that they really understood and could easily integrate into their business… and that was what drove our pivot,” Mr Perram explained.
“Now we’ve pared down our message and our approach so that we’re really a big market solution that can go after every organisation that has either a transaction coming up or a privacy issue,” he said.