What You Actually Need to Know about Diversity in LegalTech in 2021, and 7 Ways to Improve It

It’s been two and a half years since I published the first data-driven study that analyzed the (lack of) diversity among legaltech founders. I had intended for this update to be as solely data-focused as my last report, but since our collective conversation around diversity as both a country and an industry has greatly shifted since early 2018, this update warrants context about where we are, why all of this matters, and what we can do to make real change.

What is the current state of diversity among legaltech founders? To recap, after pouring over datasets for six months back in 2017–18 and analyzing 478 founders across 269 legaltech companies,¹ I found that only 13.8% of founders were women and 26.5% were diverse.² Black and Latinx founders accounted for 2.3% and 3.1% of legaltech founders, respectively. To say that these findings were disappointing, when women make up over half of the U.S. population and outnumber men in law school, and around one third of the population identify as Black and/or Latinx, is an understatement, especially since those who shape tech shape the future of the legal industry.

Fast-forward just two and a half years, and the country has had a racial reckoning spurred by the deaths of George Floyd, Breonna Taylor, and Ahmaud Arbery, among others. Both the legal and tech communities have reaffirmed their commitment to diversity, pouring money into racial equity causes, launching new programs to support minority communities, and ramping up pro bono programs. It’s been fantastic to read about, and will be even more fantastic to see their ultimate impact — if and when folks put serious action behind those commitments.

With that context, this refresh feels even weightier: how can we know what progress looks like if we don’t have baselines?

With the help of Stanford’s CodeX team and Pieter Gunst of Legal.io in particular, I set out to update my initial legaltech company and founders lists to get a sense of how much progress we’ve made since 2018, and to provide an additional benchmark for things to come. This time, to drive home the question of who is driving innovation and progress in our industry now, we narrowed the scope to standalone legaltech companies founded within the past 10 years. All in, we examined 392 founders across 219 companies for this refresh³.

Where are we now? After adding 53 companies and removing even more, our data shows a slight decrease in the number of founders of color, down from 127 to 124, and a decrease in the number of female founders from 66 to 57. However, these numbers actually represent an increase in the percentage of diverse new founders from 26.5% to 31.6%, and a very slight increase in the representation of female founders from 13.8% to 14.5%. And, while 9 Black/Latinx led companies fell off the list for being greater than 10 years old (e.g. RocketLawyer), getting acquired (e.g. SimpleCitizen), or shutting down (e.g. DealWIP), we gained 13 new leaders working on issues regarding access to justice (e.g. Athena, JusticeText, PeopleClerk) and new marketplaces (e.g. Anü, ListaLegal, Freelance for Law), among others. Those moves represent a bump in Black founders from 2.3% to 3.3%, and Latinx founders from 3.1% to 4.3%.

Why does diversity among legaltech founders matter? The entire purpose of legal technology is to make law more accessible and easier to navigate for lawyers and clients alike. Technology is the future of the industry, and thus, those who shape the tech will shape the future of justice. Considering how dire the current justice gap is, legaltech founders have immense power and responsibility to build well-informed products for a variety of users, and diverse leaders will often raise issues that others wouldn’t consider to achieve that outcome. Put simply, by decreasing design bias through diverse and female founders, our technology will be more comprehensive and impactful. Especially as consumers become more diverse, it’s essential that their backgrounds, experiences, and use cases are reflected in the tools they’re using to solve critical legal issues.

What can we do about the lack of women and diverse founders? If members of the legal community are serious about increasing gender and racial diversity among legaltech founders, we first need to ensure that our current group is wildly successful. If done right, we can change the pattern recognition of what ‘success’ looks like to buyers and investors, inspire others to start companies by visualizing representation, and increase investment in others by creating generational wealth. Here’s where we explicitly start:

A few fantastic Black/Latinx-founded legaltech companies are below:⁴

  • Anu: a platform that connects underrepresented founders (minority, female and immigrants) to law firms that are mission minded and want to diversify their client pool. Contact Tiyani Mayoko (Co-founder, CEO) at tiyani@goanu.co for business development (law firms) or PR opportunities.
  • Athena: a service that empowering moms to collect the back child support that they are rightfully owed. Contact Simone Spence (Founder, CEO) at simone@athenacollects.com.
  • Casetext: an award-winning legal research platform that makes research faster and more accurate using advanced artificial intelligence. Contact Pablo Arredondo (Co-founder, Chief Product Officer) at pablo@casetext.com for business development, fundraising, or PR opportunities.
  • Courtroom5: an automated legal toolbox for the 30 million people in the U.S. each year who go to court without lawyers. Contact Sonja Ebron (Co-founder, CEO) at sonja@courtroom5.com for fundraising opportunities and connections to small/solo firms providing unbundled services.
  • Divorceify: a roadmap to your divorce — a customized action plan, an education, access to reliable resources, and vetted local professionals selected specifically for you. Contact Sonia Queralt (Co-founder) at sonia@divorceify.com for fundraising, business development, and PR opportunities.
  • Documate: legal document automation software to create powerful workflows that push data into your templates and forms. Contact Dorna Moini (Co-founder, CEO) at dorna@documate.org.
  • FairClaims: a user friendly online dispute resolution platform that promotes access to justice and civility. Contact Stephen León Kane (Founder, CEO) on LinkedIn here for business development and PR opportunities.
  • Gavelytics: finding insights and analytics about judges, litigants, and law firms on state courts using the power of AI and machine learning. Contact Juan Carlos Moreno (Co-founder, CTO) at jcrogel@gmail.com.
  • JusticeText: an audiovisual evidence management platform designed to produce fairer outcomes in the criminal justice system by expediting the review of body camera footage, interrogation videos, jail calls, and more. Contact Devshi Mehrotra (Co-founder, CEO) at devshi@justicetext.com to help with connections to public defense agencies, small-medium private criminal defense firms, law school clinics, and for PR opportunities.
  • Legal Equalizer: a multi-faceted app aimed at promoting positive police encounters through a more legally informed citizenry. Contact Mbye Njie (Co-founder, CEO)at mbye@legaleqapp.com.
  • ONE400: a law innovation agency that creates digital experiences that connect law firms and legal tech companies with people who need their services. Contact Allen Rodriguez (Founder, CEO) at allen@one400.com with business development opportunities and new talent/advisors.
  • Paladin: a law firm and corporate pro bono platform focused on increasing pro bono engagement and decreasing administrative overhead to increase access to justice. Contact Kristen Sonday (Co-founder, COO) at kristen@joinpaladin.com with fundraising and business development opportunities [yes, it’s me!].
  • PeopleClerk: a platform that helps pro se litigants navigate the California small claims process by helping file, serve, and prepare for hearings. Contact Camila Lopez (Co-founder, CEO) at clopez@peopleclerk.com with fundraising and PR opportunities..
  • Quiktract: any easy, affordable way to get your agreements in writing by creating simple, legally binding contracts that can be amended as needed to ensure everyone gets what they should from the work. Contact Blake Stanton (Co-Founder, CEO) at blake@quiktract.com to help with user feedback and business development opportunities.

The second part of advocacy is to encourage more diverse budding entrepreneurs to get into legaltech (or, any tech so they can learn). Whether you’re at a firm, in-house, law school, or other, you can expose your team to legaltech companies, host innovative speakers, encourage them to try internships or externships at legaltech companies, promote demo days and pitch nights, and share relevant content that might inspire them.

More often than not, support for women and diverse founders comes from folks who don’t look like them, and even a kind word or note of support can go a long way on the entrepreneurial journey.

Finally, diverse founders are not exempt from responsibility here — we need to seriously commit to building scalable, sustainable, and VC-backable (if desired) companies that warrant the above actions. We need to do our research on how to approach complex problems, collaborate with others who can help, contribute to industry dialogue, and build products so good they can’t be ignored.

2021 is a great opportunity to turn 2020’s commitments into follow through, and I can’t wait to see how we collectively advance the industry. If you have other ideas, I’m all ears — kristen@joinpaladin.com.

~~

¹ ‘Legaltech companies’ refers to operational for-profit, full-time, legal-specific focused, U.S. based, stand-alone companies.

² ‘Diverse’ founders include Black, Latinx, Asian, Indian, Middle Eastern.

³ We removed companies from the original list that were founded in 2010 or earlier, had been acquired, closed down, pivoted outside of legal, or moved to a part-time staff.

⁴ These founders gave me permission to share.

Founder, COO @JoinPaladin. Founding four @Grouper. World traveller. Wine and chocolate lover.

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