Legal tech Josef raises $2.5m for automation platform expansion

Legal tech Josef raises $2.5m for automation platform expansion

Josef founders (L-R) Kirill Kliavin, Tom Dreyfus and Sam Flynn.

A Melbourne-based technology company pitching itself as an "automation workbench for every legal professional in the world" has been given a boost thanks to a $2.5 million funding round led by Sydney's Carthona Capital.

Used by the likes of MinterEllison, Herbert Smith Freehills, the Consumer Action Law Centre and the American Bar Association, Josef is a no-code software platform that empowers lawyers and legal professionals by automating repetitive tasks like client interactions, sending emails and generating legal documents.

It is a platform that has garnered 700 per cent year-on-year growth in monthly interactions for the company, which was founded with a global mindset from day one according to co-founder Sam Flynn.

"We've never envisaged ourselves as an Australian company. We've envisaged ourselves as a market leader in our space, and that's meant that we continue to grow pretty equally both internationally and in Australia," Flynn tells Business News Australia.

"That's what this round is about. It's really about capitalising on that early success and establishing ourselves in Europe and the US."

As a precursor to Josef and its purpose-driven ethos, Flynn's first foray into product development was during his time working with Supreme Court Justice Elliott when he got involved with a civil liberties group.

"At the time we had the roll-out of the myki system in Victoria - a lot of people were really struggling with it, they didn't know their legal rights, so a friend and I built an app that told people their rights," Flynn says.

"That was super successful. 60,000 people used it at the end of the first month with not a lot of marketing spend, so that to me was this lightbulb moment where I realised people want to use legal technology if you build it well."

Flynn then teamed up with university friend and lawyer Tom Dreyfus, who had previously worked with him at Arnold Bloch Leibler, as well as engineer Kirill Kliavin to found the company.

"The three of us came together to address the problem of making legal services more accessible," he says.

"All of us had had this experience Kiril externally, Tom and me internally within the legal system of legal services not being accessible, not being efficient, being slow, being expensive, so our question was 'how can we change that'?

"How can we help the legal industry change the way it it delivers legal services?"

The inspiration for the company name was the character 'Josef K.' from Franz Kafka's The Trial.

"The protagonist is a man called Josef K, and he is in the story faced with this really confusing legal world. None of the lawyers will help him understand what he's been charged with or what his rights are," Flynn explains.

"So Josef is about making legal services more accessible for people like that Josef."

As is the case with so many startups however, the founders started off with the right motivation but the wrong business model.

"We came together to start building a single application or a single bot that solved a single legal problem," the entrepreneur explains.

"As we were doing that we realised that this was going to take forever -  it's quite a complicated thing, there are so many different laws, so many different experts around the world, and so what we came up with was the idea of an automation platform with no code that would empower legal professionals around the world to transform the work that they do in this specific area of law that they specialise in.

"Through that we came up with the idea of Josef, which we launched in May 2018, and from there it's just gone from strength to strength."

The raise announced today adds to a $1 million seed round in 2019 which helped it secure law firm clients such as Clayton Utz, as well as in-house legal customers from L'Oreal to Randstad.

The COVID-19 pandemic has also delivered a boost as legal teams searched for ways to streamline their systems and processes, while reducing friction points.

"We've had 6,000 bots have been built and they're being used over 140,000 times to solve problems. Monthly interactions have grown by over 700 per cent year-on-year," says Flynn.

The latest round takes total funding to $3.5 million and also involved US investors The LegalTech Fund.

"Every now and then we see a product that feels like magic, as it enables anyone to build automation into their workflows," says The LegalTech Fund managing director Zach Posner.

"Josef's mission is to help all legal professionals capitalize on their knowledge and become developers themselves. They have built a simple, elegant, "automation workbench" for individuals to make their roles navigating the legal system easier and more efficient."

Posner's sentiments are echoed by Carthona Capital partner Dean Dorrell, who believes Josef is primed to streamline legal services globally.

"Josef's platform makes lawyers more productive, develops their interactions with their clients and streamlines their operations," says Dorrell.

"Our thesis about the legal profession is that you don't need to replace the lawyers; the opportunity is to enable efficiency in their work, and that's what Josef is all about."

Meanwhile, customers at law firms and in-house legal teams are also seeing clear benefits.

"We're thrilled by our partnership with Josef. Their technology is a simple, accessible way for all of our people to get involved with automation," says MinterEllison chief digital officer Gary Adler.

"Josef alleviates the time spent by our team on process-driven and low-risk tasks and yet is also seen as an engaging and efficient tool to the business. Josef also empowers us to up our game in the delivery of legal services in-house," adds L'Oreal's legal counsel for Australia and New Zealand, Jenna Adamson.

With companies ranging from Lawcadia to Law on Earth to SprintLaw, Australia's legal-tech scene is fast-growing, but Flynn believes there is plenty of room for growth and competition.

"There's so much exciting activity happening in the legal tech space," he says.

"I think the legal tech field is in quite an early stage of its development - market penetration is quite low, so we're excited to see all of these wonderful companies in the space.

"What really distinguishes Josef is a vision for the product, and we are an automation workbench for every legal professional in the world, and that is what is going to help us achieve our mission of making legal services more accessible. To achieve this, we are totally product-obsessed as a company."

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