In a move that will enable law firms to analyse both support staff and fee-earner costs through one supplier, BigHand will today (5 April) announce the acquisition of business intelligence and pricing solutions provider DW Reporting.
DWR, which has two products: financial BI solution Quantum; and matter pricing, budgeting and tracking solution Evaluate, will drop its name and be rebranded as BigHand with immediate effect.
BigHand is best known for its dictation and speech recognition software within legal but over the last five or six years has been expanding out its offering, including moving further into legal document production with the 2014 acquisition of Esquire Innovations and launching BigHand Now for managing and analysing the back office.
The acquisition of DWR – which will no doubt raise questions over its synergy – came about after BigHand, led by managing director product strategy & innovation James Kippenberger (pictured), began talking to DWR founder and managing director Dan Wales about how BigHand could develop its analytics offering.
Kippenberger told Legal IT Insider: “Customers say they now have a good view of their operations and staff productivity and now need to shine a spotlight on finance and go from a focus on revenue to profit – move from the practice of law to the business of law.
“Chatting with Dan and his crew, we started talking around how we could enhance our analytics offering: how can we give more data to customers so they can run their business? It became apparent that not only was there a product match but culturally there was a match. We know our customers have an insatiable appetite for technology to make them better and faster than their competitors. We had a few options: build, buy or integrate. DWF have a superb platform and this is a natural fit.”
Pressed as to whether there really is synergy between the two products or whether BigHand, which is owned by Bridgepoint Development Capital, is simply looking for additional growth opportunities in light of its saturation in the digital dictation market (BridgePoint acquired BigHand in 2012 and rumours persist that BigHand will float), Kippenberger said: “Everyone will look at saturation and market share but if you extract that out globally, our market saturation is very low. After the Esquire integration there is huge expansion potential within the document template market and within speech recognition we only have 10% of the market so there is massive potential there. BigHand has 3000 customers, so there is a great runway there.
“Dan’s two main products are Quantum and Evaluate and one reason we first started chatting to him was because with BigHand Now, we’re lifting a lid for law firms on how much they spend on back office support services. We are already providing information on the genuine cost of providing legal work and insights into the cost of the support service. DW Reporting does the same for the fee-earner so for the first time law firms will have a unique insight into the cost of delivering work.
“With the pressure of fixed fees, law firms need to work out how to turn revenue into profit and they can’t do that with just half the cost equation. If we bring them together and say ‘this is the cost of delivering legal services and our pricing tool can help you make a sensible margin’ then firms are in a much better position than a few years ago.”
DWR’s products will currently stand alone but BigHand will be consulting with its customers over future integration.
Kippenberger told us: “The reality is that we have some strong ideas over how we integrate and we will do ‘lunch and learns’ with customers and in the next stage do a deeper dive on if that’s how they want to work in reality.”
DW Reporting, which was founded in January 2013, has over the past couple of years won high profile clients including Travers Smith, Mishcon de Reya, Penningtons Manches and Foot Anstey.
This growth trajectory raises questions as to why Wales would sell, and he told us: “I never came into this to sell, we were looking to find investment and grow. We’re self-funded and we’ve done well to get to 25 members of staff but demand is starting to outstrip supply. Evaluate is hugely successful; pricing is successful and BI is hot to trot and to continue on that trajectory was unsustainable.
“We started to look at how we could continue to do what we do and look for investment. We talked to BigHand around possible integration around analytics and it became a no brainer: there is a huge market opportunity to work together and accelerate that growth – more so than if we got external investment. We have the same ideals, ethos, culture and vision. We are already having conversations which demonstrate the benefits of working with a company that has the same cultural fit.”
Kippenberger adds: “Law firms have to juggle so many different providers and suppliers but if we can bring that under one roof with one tool kit it will help them transition into the world that is coming very soon.”
Financial details of the transaction were not disclosed.