Lex Machina: a LegalTech Model for Success

In tech, it’s common for “cool” consumer facing products to get all the attention (look, drones!). LegalTech is no exception. Some of the most exciting LegalTech startups out there are indeed consumer facing (examples here and here). But while the masses are easily distracted by the “cool” of B2C, the more business minded among us, should take a hard look at the success of B2B LegalTech start-ups like Lex Machina.

Josh Becker, CEO, Lex Machina

Josh Becker, CEO, Lex Machina

Launched in 2010, Lex Machina delivers innovative SaaS based Legal Analytics tools to help law firms and businesses predict outcomes of different legal strategies. It’s impressive roster of users includes Microsoft, Google, and eBay, and law firms like Wilson Sonsini, Fish & Richardson, and Fenwick & West.

In the words of its CEO, Josh Becker, Lex Machina’s Legal Analytics enables its clients to:

“…predict the behaviors of judges, lawyers, and parties, as well as the potential outcomes of motions and legal strategies. Lex Machina can help attorneys understand which motion has a good chance of succeeding in front of a specific judge or what legal action to expect from their opposing party or counsel. It helps law firms pitch and win business, and in-house counsel assess a potential threat and select the best attorney for their case.”

What cannot be ignored about Lex Machina and its Legal Analytics is its disruptive effect on the way lawyers and corporations make decisions, by shifting away from the current paradigm of “anecdata” reliance – i.e. basing future strategy on a lawyer’s past experience with a particular judge or issue.” The future of law is combining traditional legal research and reasoning with legal analytics by solution providers like Lex Machina.

Law Insider wanted to learn more about Lex Machina, and asked its CEO, Josh Becker, a few questions about his company’s vision, the future of law and LegalTech, and how Legal Analytics will change the way we practice law in the future.


LI: As one of the more established and well known LegalTech companies out there, what advice do you have for businesses trying to build products and services for law firms?

JB: Here is some advice:

  •    Focus on serving a real business need.
  •    Don’t try to be everything to everyone.
  •    Integrity of data is critical in law – ensure the highest quality of your data.


LI: Has your business model changed significantly since you first started?

JB: We started in 2007 as a Stanford public-interest project, with the mission to bring openness and transparency to IP Law. Large tech/biotech companies and law firms contributed to the project because they needed access to this kind of data.

In 2010 we had built so much momentum, that we created an independent, venture-funded company – Lex Machina. Early on we had one or two users at many firms but now we are starting to have many more enterprise-wide deployments. We still have the social mission and our data is still free for judges and IP academics.


LI: Where do you see your business in two years?

JB: Today, over one-third of the AmLaw 100, as well as the law departments of leading tech, pharma and other companies, subscribe to Lex Machina.

In two years we see Legal Analytics being a standard part of practicing law for law firms and companies.

Also, we are going to leverage the platform we’ve built over the past seven years to expand beyond patent to other federal subject matters.


LI: Do you have any new products or upgrades coming that we should know about?

JB: We just launched Custom Insights, taking Legal Analytics to the next level. Custom Insights help attorneys surface strategic information from only those cases or motions they care about, quickly and easily.  Where other tools present predefined charts and tables, the new capabilities set attorneys free to find data-driven answers to their strategic questions, and craft winning IP strategy.

As part of the launch, we released two new applications:

  1. Case List Analyzer puts lawyers in the driver’s seat, enabling them to select cases based on specific criteria and filter those results by case type, date range, court, judge, patent findings, and more.
  2. Motion Metrics identifies the docket events and documents connected to a specific motion, and provides Custom Insights into all activity that led to a court’s grant or denial of that motion.

Our next exciting product launch will take place in Q1 2015.  It will help further with Early Case Assessment and help patent prosecution.

LexMachina Banner

LI: Is the legal profession as we know it dead or dying?

JB: The legal profession is alive and well.

In today’s hyper-competitive world, good legal advice is more valuable than anytime in history.

At the same time, clients are expecting a lot from their lawyers. They expect their lawyer to be on top of their subject matter and answer tough questions quickly.

Lex Machina helps lawyers to be better lawyers by focusing on strategic questions, supported by data.


LI: Some people believe that LegalTech for law firms and lawyers is a bad business because the total available market is so narrow. Do you see inherent limitations to your business model?

JB: Law is a multi-billion dollar industry, which spends billions of it on IT.  We think it is a large addressable market.


LI: What does your ideal coustumer look like?

JB: Our ideal customer is a law firm or corporate law department that wants to employ analytics to improve its operations and results.


LI: What’s your current customer acquisition model?

JB: We do lots of outbound marketing about the emergence and importance of Legal Analytics, as well as respond to unsolicited inbound requests for information.


LI: If you could pick two of your biggest challenges what would they be?

JB: The messy condition of litigation data in PACER.

The long sales cycles required for law firms.


LI: Lawyers are not exactly the most tech-friendly crowd, do you agree, and if yes, how does it impact your business?

JB: Quality technology has been widely adopted by successful lawyers. The extent of technology adoption is determined by its usefulness and ease of use.

We have always challenged ourselves to make Lex Machina both easy to use and very valuable to our customers. It can take awhile to get adoption, but as we have experienced, once you get there, you have very loyal customers.


LI: What do you feel most proud of in your work?

I am proud that we have been able to build a product that has won the passionate support of our customers, both in-house and at firms.

Senior attorneys are describing our Legal Analytics with terms like: “Truly Breathtaking”, “High-Voltage”, “A Must-Have” “Ground-Breaking”, “Advantage-Giving”.

It is not often that lawyers use such language to describe a service!

As CEO, Josh leads strategy and operations for Lex Machina and is a thought leader on intellectual property trends and leveraging technology to improve the practice and business of law.

After graduating from Stanford Law, Josh had a career in venture capital and entrepreneurship before coming back to run Lex Machina.  He has been a featured speaker at Legal Tech, IP Value Summit, Reinvent Law, and others.

Josh was part of the Founding team of Dice.com (NYSE:DHX) and ran corporate development at Agile Software (sold to Oracle). He was a Venture Capitalist at Redpoint Ventures and then was a Founding General Partner of New Cycle Capital. Previously he worked at McKinsey & Co. and Netscape.

He runs Startup2Startup, an entrepreneur dinner/discussion group, and is active with the Stanford Angels and Entrepreneurs.  He co-founded, and now chairs the Full Circle Fund, a coalition of technology and business leaders that collectively funds and supports leading social entrepreneurs. Josh earned a joint J.D./M.B.A. from Stanford University and a B.A. from Williams College.

About Michele Collu

Michele Collu joined the Law Insider team as Managing Editor in 2014. Based in San Francisco, Michele is passionate about legal tech and the evolving landscape of the legal profession. Michele received his LL.M. from Berkeley School of Law (Boalt) with a Certificate of Specialization in Law & Technology. He received his J.D. from Università Commerciale ‘Luigi Bocconi’, in Milan, Italy, where he graduated Magna Cum Laude.