What We’re Doing
Takeaways From ILTACON 2018
Artificial Intelligence Is Driving A Wave Of Innovation And Growth In Alternative Legal Services
The market for Alternative Legal Service Providers (ALSPs) is evolving rapidly and, although still in its infancy, accounts for an estimated $8.4 billion1 of legal spend annually, according to Thomson Reuters. ALSPs have been an integral partner to corporate law departments and big law firms seeking to improve operational flexibility and reduce costs – the sector has grown directly from this need for contract lawyers, managed services and digital tools that bring greater speed and efficiency to high volume, repeatable legal processes.
The emerging ALSP leaders are now shifting attention beyond simple process efficiencies and are embedding artificial intelligence (AI) into components of the legal workflow to assist attorneys with analytical tasks such as contract review, due diligence and other value-add services. By leveraging AI in these areas, attorneys are able to spend more time focusing on areas that will have a greater impact on the outcome of a case – motion for summary judgement, investigation and trial preparation – increasing the likelihood of a higher value result for the client.
As law firms have been slower to build these service offerings internally, private capital and traditional consultancies have devoted meaningful resources toward capturing this opportunity. As capital continues to flow into the sector we see the technology and service offerings improve with the eventual development of multi-service platforms – packaging best-in-breed services and execution expertise together for global corporates and law firms. As this trend continues, we expect service adoption rates to increase and sector growth to continue.
To learn more about the growing legal services sector, please reach out to Derek Lewis.
Harris Williams served as the exclusive advisor to Veritext, a leader in deposition and litigation support services, on its sale to Leonard Green & Partners.
The transaction marks the third time Harris Williams has sold Veritext and is HW’s second legal services transaction closed in six months.
Read the press release here.
Representative HW Legal Services Transactions
The Business Services group has served as a trusted advisor to numerous legal services companies and continues to focus on this growing and innovative sector.
Select legal services transactions include:
What We’ve Been Reading
Looking At The Aging Workforce Through A New Lens
Many businesses are facing a critical shortage of experienced professionals, with industries such as accounting citing “lack of skilled personnel” as the #1 challenge for three quarters in a row. For hiring managers to attract top talent, they must view the aging workforce through a new lens. Today, we consider those 65+ to be “older” and less skilled or capable. But we must shift our perspective on age. The average life expectancy for a man is 80 years old, and for a woman the average is 85 years. A 50-year-old is no longer a “senior.”
The Barriers To Recruiting And Employing Digital Talent
Finding digital talent is one of the biggest challenges facing companies today. But it’s particularly difficult for large, traditional firms, especially those which operate in consolidated, non-growth industries (think pulp and paper, steel, airlines) and which are often located away from the metropolitan areas where data scientists live.
Read more about it here
Legal Tech Preview: Digital Disruption Fuels M&A
In the same way fintech has ravaged the financial services sector, increasing demands from clients are leading law firms and venture capital firms to invest millions in legal technology with the promise of cost reductions and more effective, streamlined work processes. Research from investment firm Catalyst Investors predicts that the legal tech market is worth about $16 billion, with the largest areas of spending being deployed across enterprise legal management, contract management, due diligence and eDiscovery.
What We’ve Been Hearing
Excerpts From Recent Earnings Calls
“Our capital allocation priorities remain the same: Invest in organic growth; acquisitions; pay down debt; and the payment of the quarterly dividend. Also in the first half of 2018, we have repurchased 90,252 shares for a total outlay of $5 million to partially offset the dilution from our employee incentive programs.” – James C. Morgan, CFO & Executive VP
“In terms of acquisitions, PeopleScout business, we’ve got a position of strength in North America, position of strength in Australia/New Zealand. The areas we haven’t had as much strength have been in Europe and in Asia. And so, we’ve been growing those areas organically, but we thought it made a lot of sense to jumpstart our capabilities in Europe with the TMP acquisition. […] We’ve been looking in Asia, haven’t necessarily found anything that fits what we’re trying to accomplish, but we’re going to continue to look for opportunities that expand our global capabilities.” – Patrick Beharelle, President & COO
“I'm very pleased with what we've been able to do on the acquisition front over the last 12 to 18 months. And I think we could find -- continue to find things like we have found in the last 18 months. We would do those all day long. The challenge, of course, for us, as you know, is we are in the process of simplifying, reducing platforms, focusing on our next-generation platforms. And so that makes it hard to do, what I would call, traditional -- make traditional acquisitions. So we're not looking, for example, for the next benefits platform. We're not looking for the next payroll platform. We -- we're building our own next-generation payroll platform. We have a great one already that is serving us well and is very profitable.” – Carlos A. Rodriguez, CEO, President & Director
M&A Market Trends
Select Recent M&A Transactions1
Business Services M&A Volume (By Year)1*
As of August 31, 2018
* Represents all announced or closed M&A transactions in the United States and Canada
* No transaction value provided for undisclosed deals
1. Thomson Reuters
3. U.S. Bureau of Economic Analysis
4. The Conference Board
5. U.S. Bureau of Labor Statistics
6. U.S. Department of Labor
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