Legal tech startup Clio ups its FinTech game with payment product launch in Canada
Clio claims to have processed over US$1 billion in legal transactions.
A year after Clio launched Clio Payments in the US, the startup is making the payment product available in Canada.
Clio, a provider of cloud-based legal technology, noted that the product rollout in Canada is the startup’s first step toward international expansion for legal payments. Clio Payments in Canada also marks the development of the startup as it expands into the area of FinTech products.
“Payments are an integral part of our centralized platform.”
– Jack Newton, Clio
Jack Newton, Clio’s CEO and founder, previously told BetaKit that outdated paper invoices and payment processes caused difficulties for lawyers when it came to invoicing and getting paid. At the same time, clients sometimes struggled when they had to pay a lump sum, and they could also experience problems understanding fees.
When Clio originally developed its payment product, it operated a third-party processor. But Clio described the offering as limited in that it only accepted credit card payments, and had a slow onboarding process as well as a complex pricing model.
Clio decided to build its own platform from the ground up. The resulting system not only addressed the previous problems but added other features such as the ability for clients to pay in installments.
In fact, these days Clio is starting to look more like a FinTech in legal tech clothing. In addition to general law practice technology, the startup’s offerings include a legal accounting software suite that helps law firms manage client funds in trust accounts, and helps track billing as well as time and expense tracking.
Newton said that through Clio’s work with hundreds of thousands of lawyers, the startup knows that the most frequent point of friction in the relationship between lawyers and clients is collections.
“Financial conditions place a heavy burden on a firm’s operations, time and revenue,” Newton said. “Bringing payments to the Canadian market has the potential to fundamentally change where lawyers spend their time – and who can access legal services. Canadians can now benefit from a better payment experience when dealing with their legal issues.”
RELATED: Legaltech unicorn Clio also now a centaur after hitting $100 million USD in ARR milestone
Clio launched its payments solution in the US in 2021 at the Clio Cloud Conference, kick-starting the startup’s expansion into financial services for the legal industry. The startup claims to have processed over USD 1 billion to date in legal transactions with continued steady growth.
“Clio has grown steadily to solve attorney-client pain points by providing seamless and efficient solutions at every point of the client journey,” said Newton. “Payments are an integral part of our centralized platform.”
According to Newton, most legal payment services are complex and disjointed. Clio’s goal is to provide a seamless collection and payment experience while making legal services more accessible.
Founded in 2008, Clio is headquartered in Burnaby, British Columbia and currently employs over 800 people in four offices around the world.
Clio earned unicorn status in 2021 after a Series E raise of $136 million CAD, and in June passed $100 million in annual recurring revenue to achieve centaur status. The startup has raised $386 million in capital since 2008, including a $250 million funding round, which Clio claimed in 2019 was the largest for a Canadian startup at the time.
Clio maintains that acquisitions are at the core of the start-up’s business model, and that the merger and acquisition strategy is directly in line with the goal of accelerating the product offering. In 2021, the startup acquired Lawya, which creates digital workflows for legal documents, and automated the launch of the court calendar CalendarRules. Clio also acquired customer intake and relationship management start-up Leicata in 2018.
The startup bolstered its executive suite in anticipation of its next phase of growth in 2021, bringing in talent with experience from Uber, Airbnb, Lightspeed and PointClickCare to serve as COO and chief people officer. Clio also added former Clearco CFO Curt Sigfstead as CFO in 2022.
RELATED: Clio and Trulioo Say No to IPOs as CEOs Discuss Unicorn M&A Strategies
Sigfstead brought Clio experience from public market finance, and at the time he joined, Newton wasn’t sure about Clio’s IPO plans, but called it a possibility. The CEO noted that Clio had “many of those ingredients already in place” to go public “at a moment’s notice,” but noted that the startup would only go public when the time was right.
But in late March, Newton told BetaKit that the window of opportunity for an IPO had passed. To be sure, when Clio put some IPO plans on hold, Hootsuite had also come to the same decision in late 2021.
And no wonder: Although many technology companies went public in 2021, not many had much to show for it towards the end of the year. The Globe and Mail reported that the average return for an IPO in the technology sector over the past year was minus 2.4 percent, compared to 16 percent for the average stock market. The same market downturn caused Sharethrough to delay its IPO as well.
As for Clio Payments, Newton said the product has had a strong impact in the US with legal professionals there taking advantage of the “simplicity, security and efficiency” of payment processing in the cloud. “Now, with our launch in Canada, we can extend these significant benefits to our Canadian customers,” said Newton.