Legal software company Clio drops $1 billion with huge volex of legal data

On Monday, Clio, a 17-year-old Canadian law firm management software company, announced it had agreed to acquire 26-year-old legal data intelligence platform Vlex in a $1 billion cash and inventory transaction.

The announcement comes about a year after Clio’s massive $900 million funding round, with British Columbia-based Vancouver’s valuation rising from $1.6 billion in 2021 to $3 billion.

According to Jack Newton, CEO and founder of Clio, Vlex, which was largely bootstrapped until it was purchased by private equity firm Oakley Capital in 2022, was a very popular asset.

Harvey, a startup at AI-Native Legal Tech, tried to buy Vlex a year ago, but there were no acquisitions at all. As reported by the information Last July.

Vlex is a valuable property as its database of legal documents can greatly improve the AI ​​model of lawyers.

“Data is one of the only long-term defensible, competitive moats that businesses can have in this space,” Newton told TechCrunch.

Vlex competes with the legal database owned by Thomson Reuters and LexisNexis. The acquisition comes just after Harvey announces it Partnership with LexisNexisWe aim to enrich Harvey’s AI with LexisNexis data.

With the acquisition of Vlex, CLIO is effectively delving into the practice of the law itself by providing law firms with time tracking, billing and electronic payment tools.

Over the past few years, Vlex has been building Vincent, an AI model built on top of the company’s legal content database.

“AI is trying to drive the convergence of what is historically a clear category of software: legal business and legal practice,” Newton said. He added that Clio’s clients in the Small and Medium Law Firm segment will have access to Vincent’s AI capabilities.

In addition to announcing plans to acquire the Vlex, Clio said it reached $300 million in annual repeat revenue (ARR).