Huge untapped opportunity awaits UK legaltech sector
The LawtechUK study suggests the untapped annual market could be worth £22 billion per year
A recent study suggests that the UK legal technology sector could be sitting over an untapped huge market opportunity which could be worth as much as £22 billion per annum.
The study was carried out by LawtechUK.
The study titled Shaping the Future of Law revealed that serving small and medium-sized businesses (SMEs) and consumers alone could be worth £11.4 billion a year.
The study suggested that besides serving unmet demand from SMEs and consumers, it could also lead to £8.6 billion in cost savings for SMEs every year.
In addition, legal businesses in the UK could generate £1.7 billion in annual productivity gains through the use of legaltech.
"The law is critical in all our lives and businesses and it should be easy to engage with and affordable and effective for everyone. Lawtech is how we make that happen. The sector is seeing incredible growth – with lawtech start-ups and scale-ups growing at 101 per cent over the last three years and adoption levels increasing during COVID-19 across our courts, legal businesses and in-house legal teams," Jenifer Swallow, LawtechUK director at Tech Nation, said.
The report said that roughly 200 legaltech start-ups and scale-ups of the UK had attracted £674 million in investment by the last year-end, with its growth rate outpacing the fintech, climate tech and healthtech sectors.
UK legaltech businesses could attract £2.2 billion in investment every year by 2026, contributing 12,500 jobs to the economy over the same period, the study stated.
The report indicated that the fastest growth is coming from regulatory compliance-related legaltech, an area growing more than two-fold between 2018 and 2020. Legaltech aimed at the consumer and SME category grew by 74 per cent over that period, with legal document creation, management and review tech growing by 24 per cent.
"Building on this growth, working collaboratively across the sector, we can realise the full strategic opportunity of lawtech on an accelerated timeline and deliver results no one organisation could achieve alone – for the benefit of regular people, businesses, the UK economy and the wider global ecosystem. The £22bn market opportunity of lawtech evidenced in this report only scratches the surface of the true impact we can have through digital transformation in law," Swallow added.
LawtechUK is a government-backed initiative within Tech Nation, a UK tech entrepreneur network. It encourages greater collaboration across the legal industry to capitalise on the growth opportunity.