LawTrades - Bringing The Legal Workforce Online

Company & Team Introduction

LawTrades is a freelance marketplace that connects companies seeking legal services to a network of on-demand legal professionals. The company was founded in 2015 and is far from an overnight success. For years, the company couldn’t find true product-market fit and struggled to raise capital while their team watched competing startups raise massive sums of money. LawTrades team kept building for years, refining their product offering and ICP until eventually they found the customer that needed their service. With the help of COVID-19 tailwinds moving the world online, the company has taken off and hasn’t looked back. LawTrades was founded by two former law school graduates, Raad Ahmed (CEO) and Ashish Walia (Head of Business Development), who knew there had to be a better model to provide legal services. After a turbulent journey, it seems as though the duo was right. Lawtrades is headquartered in Long Island, New York and has grown its employee headcount to ~40 people.

Product Overview

LawTrades is a simple-to-use online platform that connects companies seeking to hire legal talent with a freelancer network of on-demand legal talent. For legal professionals, you can apply online easily, and the application will be vetted in less than 24 hours to validate credentials and see if the applicant is a good fit for their platform. If so, a talent success manager will reach out to schedule an interview. After the process is complete, freelancers are shown potential opportunities that match their skillset. For companies, simply create a position your company requires and the specifications (Budget, # of hours per week, availability). LawTrades will take the data and curate a list of legal professionals that fit your criteria, and then they choose which candidates they’d like to interview.

Here is a percentage breakdown of the different legal skills on their platform:

- 62% Lawyers
- 18% Paralegals
- 5% Legal operators
- 4% Compliance Professionals
- 8% “Other”

Customers see the immense value LawTrades provides them as they slowly migrate away from the legacy legal model for a myriad of factors, with the main drivers being efficiency, cost-effectiveness, and ease of use of their platform.

Total Addressable Market

The freelance legal talent market that LawTrades is capturing is already enormous and should have a long growth runway. LawTrades team estimates their total addressable market to be as large as 100B, and the value proposition for legal professionals is extremely enticing. They could work for some law firm and make great money, but work with an awful boss, working insane hours for clients they don’t want to work for in a topic they’re not interested in, or work with LawTrades and work the jobs you wish to, with clients you enjoy working with, solving interesting problems, oh and making great money as well. LawTrades is disrupting an industry with little to no change in over 100 years.

Business Model & The Numbers

LawTrades has completely transformed their business from struggling to superstar. The company’s most recent valuation from their Series A is 80M, an incredible feat considering a few years prior, it was questionable if the company would still be alive. Typical pricing on the LawTrades platform ranges from $150/hour to $ 180/hour, a bargain compared to the upwards of $2000+/hour some of the top law firms charge per hour. The company was also cash flow positive when raising its Series A, giving it much more leverage over its investors and helping them dictate the terms and valuation it raised at. The company reached 1M in monthly revenue for the first time in 2022, an impressive jump from the 6.6M they generated in 2021. The company generates revenue through a percentage cut of each transaction made through the platform.

Traction

After years of struggling to find customers, a few strategic changes, including changing their focus upmarket from startups with tight budgets to enterprise customers who have semi-frequent needs for instant legal talent, selling into legal departments of companies has transformed the business and growth has skyrocketed ever since the boost they saw from COVID-19. LawTrades has built a strong base of supply and demand for their network, having attracted over 2000 legal professionals on the platform and serves over 100 customers, including some of the biggest technology companies in the world, including AngelList, Yelp, HeadSpace, Duolingo, DoorDash, Gusto, and Cruise among the list. Legal professionals on LawTrades also reached a new high (at the time) of more than 7000 hours worked on the platform.

Competitors

The biggest competitors to LawTrades are UpCounsel and Priori Legal. Here is a bit on both:

UpCounsel differentiates itself from competitors such as LawTrades in part by the market it targets. UpCounsel is building a vertical-specific company to offer only lawyer services to companies of all sizes, including small businesses and startups to Fortune 500 companies. A much different market approach from LawTrade's, where they target fast-growing enterprise customers but offer a larger breadth of legal skills, including Paralegals and compliance professionals. UpCounsel was founded in 2012, raised over 26M in funding and has grown its network to over 10,000 lawyers. The company takes a 3.5-15% cut of each transaction on their platform and was acquired by Enduring Ventures after the business struggled in 2019 and 2020.

Priori Legal is a much more significant competitive threat to LawTrades. Priori was similarly founded by a pair of Yale graduates in 2013. The company’s model is much more akin to Lawtrades as they compete for large enterprise customers while following the same strategic moves, such as a more rigorous vetting process with requirements for credentials like years of experience and offering a larger breadth of adjacent legal services to help solve their enterprise client's large range of issues. Priori has grown its team to 50+ employees and most recently secured 15M Series A2 in 2022.

Funding

LawTrades has raised 3 rounds of funding throughout its almost decade-long journey. The company was initially funded with a 100k investment from an accelerator in late 2015 before closing a proper 1.83M seed round nearly a year later. The company returned to the capital markets a few years later in 2018, only raising 1.73M to give enough runway until their Series A. In 2019, the company set out to raise their Series A but struggled to stir up investor appetite. After making adjustments to their ICP and an online shift due to COVID-19, the company quickly raised a 6M Series A round, with over 100 investors participating, no meetings taken, and only sending a link. Included in the round were VC firms such as Dispatch Ventures and FourCities Capital and notable angel investors such as Ankur Nagpal (founder of Coursera and Amanpal Bhutani (CEO of GoDaddy). LawTrades has raised a total of 9.7M in funding.