LegalTech company raises £2m to accelerate global growth of its client base
The Northern Powerhouse Investment Fund II (NPIF II) has completed its first deal in South Yorkshire since the launch of the £660m fund in March this year.
FinLegal – a Sheffield-based LegalTech company whose platform is used by the leading claims firms in the UK and Australia – has raised £2m to accelerate the growth of its client base internationally.
The funding has come from NPIF II – Mercia Equity Finance, which is managed by Mercia and part of the Northern Powerhouse Investment Fund II (NPIF II), and Mercia’s own funds.
FinLegal’s platform is designed for managing class actions or large numbers of similar claims, where a law firm may be acting on behalf of thousands or even millions of claimants.
It enables claimants to engage with lawyers more effectively while allowing law firms to benefit from automation and AI and reduce operating costs. FinLegal states that it can enable legal teams to handle up to six times more claims.
The company was founded in 2019 by Steven Shinn, an IT specialist who had been following the news stories about the Post Office group action and recognised the potential to use automation to make the process more efficient.
Since its launch in 2020, the platform has processed over two million claims.
FinLegal, which currently employs 25 staff including three at its US office, more than doubled its annual recurring revenue (ARR) to £1.8m in the year to April 2024, and increased total revenue to almost £3m.
The latest funding, which brings the total raised by the company to date to £5m, will also enable it to further develop its product to meet the needs of a wider audience and create 26 new jobs.
Shinn said: “The claims market is ripe for a platform like ours. Many claims are run on a no-win no-fee basis and increasingly there are fee caps, so operating costs are critical.
“Our solution reduces costs, automates but also improves client care and makes it possible to manage claims at a scale which might otherwise not be viable.
“It has already been adopted by the some of the leading claims firms and this investment will enable us to accelerate our international growth.”
Chris Borrett, of Mercia Ventures, said: “FinLegal represents a new breed of AI-enabled LegalTech companies.
“The business has rapidly cornered a niche within the mass volume litigation market and is driving substantial productivity gains for major global law firms.
“Steven and his team have acquired clients across the UK, Australia and in the USA and set their sights on becoming one of the leading litigation platforms globally.”
Simon Cunnington, director, nations and regions investment funds, at British Business Bank, said: “The use of AI is not limited to technology companies, and we are seeing increasing use in the professional services sectors to maximise efficiencies.
“FinLegal have ambitions to revolutionise the claims and litigation sector, and as one of the first Northern Powerhouse Investment Fund II investments in the region, are a prime example of how the fund can unlock potential.”
