No-code legal automation vendor Josef has raised AUD$5.2m led by new investor OIF Ventures as it looks to expand its customer base in the United States, where it has gained significant traction over the past year. Most of Josef’s existing investors also came in on the round, which is the Melbourne-headquartered company’s third funding round, after it raised AUD$1m in 2019, and AUD$2.5m at the start of 2021.
Josef, which was founded in 2017, enables lawyers and legal professionals to create digital tools that automate repetitive tasks, from streamlining intake to drafting contracts. The software is used by law firms and corporate legal teams, as well as government and community centres. Founded by former lawyers Tom Dreyfus and Sam Flynn together with engineer Kirill Kliavin, Josef launched an office in the United States in March this year, led by customer success manager Jake Brown.
Speaking to Legal IT Insider about the raise, Dreyfus said: “The big thing about OIF and where they have a track record of success is bringing B2B companies into the United States and that is the focus for this funding moving into 2023. Over the past 12 months we have really started to establish a presence in the US, and we opened an office in the US and the UK in the past 12 months. More than 70% of our revenue growth has been from outside of Australia, and in the US we’ve started to work with some of the very largest law firms.”
Below from left to right, Josef founders Kirill Kliavin, Sam Flynn and Tom Dreyfus
Law firms including Gunderson Dettmer, Clifford Chance and MinterEllison are all said to be active users. At Gunderson, director of client experience, Joe Green, said: “With Josef in our innovation technology stack, our attorneys are empowered to build nimble tools for the long tail of use cases we see for content- and expertise-driven automation. We’re using Josef to rapidly prototype and deliver process and workflow innovations so that the firm can provide more value to our clients more quickly.”
The other growth area for Josef is the corporate market and Dreyfus said: “We are working with companies like Bupa and Nutanix, where the corporate legal teams have been using the platform successfully. It’s been a year of big growth and with OIF we have found the right partner to help us with that next phase.”
Flynn credits Josef’s success in the US with its ease of use, which has seen adoption by attorneys and paralegals. He said: “The likes of Nutanix and Gunderson Dettmer are giving the tool to their attorneys, paralegals and junior solicitors, and they are building the tools they need.”
He adds: “At Bupa, the in-house team have built a portal and a suite of client facing and also workflow automation tools. At MinterEllison they have got hundreds of lawyers and staff on Josef building tools and have launched a number of bots. Most recently they launched DINa to help directors find out their regulatory requirements.” DINa assists directors with navigating the DIN (director identification notice) application process
The current funding round is still a pre-series round and Dreyfus said: “We are raising money when we want to and the way we want to. We have been building a capital efficient business and the round now was the right one to pursue expansion in the US.”
While funding has dropped in light of recent market turmoil, Flynn said that Josef benefited from being a more mature company that “understands our own value proposition and what our customers use our platform for.” He said: “Conversation with investors was different this time because we had customers who were more than happy to speak to investors.”
Dreyfus added: “While we are proudly capital efficient, we’re also growing really quickly, at more than 100% revenue increase year on year. We’re still very much the high growth tech start-up that we always were, we have just learned that the opportunity in legal is huge. We are building legal automation – not enterprise – and we aren’t afraid to double down on what we do well.”
In terms of product development, Dreyfus says that Josef has been focussing on creating an integrated experience for customers, commenting: “When you use Josef, it connects across the tech stack, whether that be DocuSign, or iManage, or Salesforce or Slack. Josef enables end-to-end legal workflow automation and that has been a key driver.”
OIF co-founder and partner Jeffy Stesel said in a statement today (28 November): “When investing we look for a business that has both a solid understanding of their customer’s needs, but also longevity in their ability to service that need. What’s exciting about Josef is its potential once a customer is onboard – the platform’s scope never stops growing.”
The other investors in the round are Carthona Capital, Flying Fox Ventures, Jelix Ventures and Saniel Ventures.
caroline@legaltechnology.com