Franco-European legaltech: the battle for hearts and minds

In recent years, the French and European legaltech market has recentered itself. “With the self-regulation of the actors and the arrival of Covid, those solutions for which there was no obvious need have fallen by the wayside,” explains Grégoire Miot, treasurer of the European Association of legaltech (Elta). Despite this, in Europe there remains interest in tools for collaboration, contract management and understanding regulations. “For primary needs, in other words,” adds Miot.

LegalPlace, which in October announced a fundraising of €20 million, wants to enhance its range of legal services intended to facilitate business creation procedures and allow entrepreneurs to check whether they have complied with all their obligations.

By acquiring Hyperlex, DiliTrust has shown that it wants to secure its position in the contract segment, with the help of artificial intelligence. Legaltech businesses also wish to make life easier for users on the subjects of document collation and sharing of confidential files, as well as on the centralization and monitoring of pre-litigation and litigation files. Lex Persona, for its part, recently made available a free tool for signing documents remotely.

The local option
The next stage in the life of Franco-European legaltech, for Miot, will see the development of all-in-one solutions. This can probably be done via M&A activity by legal publishers, which has intensified over the past three years. Many solutions of French origin are pioneers in their sector, or have put themselves in a good position to capitalize when their activity experiences a leap. Startups like Doctrine and Predictice are helping boost the influence of the French market. A sign that users have acquired a taste for French legaltech? Miot notes a “sensitivity to the choice of French or European solutions,” at the very least.

In public tenders, local preference has been predominant in recent years. Understandably so: choosing French or European solutions has its perks, after all. There is the question of the need for closeness, of course, and users of these solutions, get the peace of mind that comes from knowing that European legaltech have a good understanding of the specific local legal and regulatory issues. “Proximity also allows clients to keep tabs on changes in the legal profession, and in local practices. Many parameters come under local business and legal practice,” continues Miot.

The European business community tends to associate French and European legaltech with data security

Most European legaltech have also been built on the feedback of their customers. Customers who, Miot stresses, “appreciate being able to use a language other than English, which is not always best suited to their needs, yet is a feature that is often overlooked by Anglo-Saxon companies.”

High-horse
In the Old Continent, the market is still evolving. Grégoire Miot thinks that there is still “a lot of room for improvement” for legal professionals, in terms of equipment. "We are still talking about the first generation of legaltech solutions. The good news is that members of the European business community are sending positive signals: users tend to associate French and European legaltech with data security."

Orlando Appell, the COO of SAP, acknowledges that "many customers ask to host data in Europe and to go through European stakeholders to do so." The publisher now offers private encryptions. Customers can also, depending on the chosen cloud solution, decide on the location of the data center where their data is stored.

Europe can also use its regulations to its advantage, when promoting its young legaltech prodigies. The electronic signature market is a good example: “American company DocuSign tried to conquer the European market by arriving on its high horse, but found local players already established," recalls Miot.

E-signature solution providers are not licensed the same way in the United States as they are in Europe. In the European Union, it is necessary to comply with the eiDAS regulation, which promotes the development of a digital trust market. Member-states were able to draw up lists of authorized holders. Spain, for example, decided to exclude DocuSign.

Still, among the general public at least, according to Grégoire Miot, the potential of the legaltech market has not yet been grasped, with fintech taking all the praise. Legaltech startups rarely put together applications for public funding, since at present this is only granted to projects covering the digitization of justice. Quite an unfortunate state of affairs, when you consider that Franco-European legaltech may just require a little push in order to take off.