The top five legal tech fundraises including tax deals in January were Zasta; Contractsafe; SirionLabs; TaxBit and Landeed, data shared with Legal IT Insider shows, as the number of venture capital-funded deals dropped to its lowest level in years and was significantly outpaced by M&A. The total amount raised across the five largest deals, data shared with us by industry analytics company Legalcomplex.com shows, was $176.15m, down 68.6% from January 2022.
The largest raise of the month was by German digital tax platform Zasta, which raised $65.27m in debt on 17 January from state-owned bank Vereinigte Volksbank. That raise was followed in size by Contractsafe, which secured $27.5m of private equity funding led by Five Elms Capital. The next largest fundraise in January was contract lifecycle management vendor SirionLabs, which at the start of January raised $25m from Brookfield Growth as part of an extended Series D. US crypto tax and accounting software provider TaxBit last month raised $15.6m in a low-key raise that follows its $130m Series B in 2021. And India-founded property verification platform Landeed raised $8.3m in seed funding from investors including Draper Associates, Y Combinator and Bayhouse Capital.
While private equity funding is prevalent among these largest deals, across the board there were just 17 venture capital deals – a drop of 50% on January last year. That compares with 28 M&A deals across the month – albeit M&A is also down by 22% on January 2022.
Raymond Blijd, founder of Legalcomplex, told Legal IT Insider: “M&A deals outpaced VC deals by the widest margin we have ever recorded,” adding: ‘The 17 deals were the lowest number of VC deals for any January since 2015. In short: later-stage investments in any legal tech sectors fell off a cliff. It’s a really tough market out there.”