Small business-focused online legal platform Lawpath has raised $7.5 million from investors to drive international expansion as the company’s rapid growth has been bolstered by a COVID-led boom in side hustles.
Lawpath CEO Dominic Woolrych (pictured) says the Sydney-based platform recorded a surge in activity during the first lockdown in 2020, and it picked up again the second time around this year.
“One really interesting fact that we didn’t expect is the people starting new businesses would be up 15 per cent,” says Woolrych.
“We were expecting it to actually go down.”
Woolrych says Lawpath starts about 5 per cent of all businesses in Australia through its platform and that the latest figures show about 40 per cent of new businesses currently being started outside of office hours.
“With everyone working from home, with a lot more time on their hands because they’re not transiting to their offices every day, they’re all thinking about their side hustles,” he says.
“People who may be starting an eBay store, or an Instagram account that sells merchandise, are coming to our platform to set up a company or a business.”
The company, which was listed 37th in the 2020 Deloitte Technology Fast 50 with annual revenue growth of 170 per cent, uses a subscription-based model to provide users with affordable access to online tools, workflows, legal documents and on-demand lawyers.
Among other services, Lawpath assists in setting up the necessary registrations needed for a new business.
“Our software is a work-through solution that does that for you,” says Woolrych.
“Typically, about half of those people move onto a subscription with us where they pay an annual or monthly fee where they can access on our platform for all those legal tasks that a small business will need to do. Even if they want to bring on investment, our platform can do that.”
Lawpath currently has 230,000 platform users – a figure that has doubled every year over the last two years.
The latest capital raising is aimed at helping grow the business in Australia and drive the company’s ambitions to drive into New Zealand and South-East Asia.
The fast-growing platform, which launched in 2014, has drawn a number of new high-profile investors in the $7.5 million round, including the Gonski family, the chairman of Adore Beauty, Justin Ryan, and Barry and Darren Smorgon’s Sandbar Investments.
Tony Faure, the chairman of both Ooh! Media (ASX: OML) and Readytech (ASX: RDY), has been appointed chairman of Lawpath. Faure also participated in the latest capital raising as chairman.
Key backer LegalZoom (NASDAQ: LZ), which led Lawpath’s previous round in 2019, bolstered its holding further with the latest raising and affirming the US giant’s continued appetite for the long-term investment.
Woolrych says the Lawpath business has materially benefited from the expertise provided by LegalZoom, the world’s largest online legal platform.
“LegalZoom have been really supportive especially around our product and marketing. They have 20 years’ experience in the US doing this.
“We’re really happy with the variety of investors we have this time around. A big part of this round is about bringing some additional people onto our register so we can expand our network, and I think that will really set us up really well into the future.”
Lawpath plans to double its team to 40 people over the next few months as it ramps up its activities in Australia.
The company is not expecting to launch internationally until at least 2022 and Woolrych, a professional lawyer, is confident the platform can cut across international jurisdictions.
“Typically, it’s been very difficult to move into new jurisdictions,” he says. “But we have the legal infrastructure through the existing platform, and we can very quickly swap out the lawyers, the legal documents and the e-legislation and move quite quickly between markets.
“At the moment, we’re really just getting good traction in Australia and we’ve always known it will be an international business.”
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