6 - Wales as a global leader in LegalTech: a roadmap for the future
Our research into the Welsh LegalTech ecosystems has unveiled a multifaceted environment characterised by notable examples of innovation among start-ups, scale-ups, law firms, and universities. There is a clear potential for all these parts of the ecosystem to collaborate, with a view to addressing the issues that have so far limited the growth of LegalTech in Wales, including the concentration of innovation in South Wales and the cost and expertise barrier faced by small law firms, and to develop a more cohesive identity for the Welsh legal services industry. In this chapter, we review some of our key findings and advance recommendations to support inclusive and sustainable growth in the Welsh LegalTech sector. 6.1 The key findings of our research Wales is home to innovative start-ups, like Validient, Identitech and Wyser, as well as to leading scale-ups, like Credas, Hoowla and W2 Global Data. These start-ups and scale-ups interact with a rich layer of companies that operate in neighbouring sectors, in particular FinTech, and develop legal technology as part of their business activities. Taken together, these two layers of entrepreneurship demonstrate the strength of the growing LegalTech sector and the role of Wales as a favourable business environment for LegalTech. The LegalTech start-ups that have responded to our interviews highlighted some key features of the Welsh business environment that support their growth: from easy access to Welsh Government, to collaboration with universities and other industry players, support from FinTech Wales, and the availability of business support. However, they have also identified areas for improvement, from access to private investment, to unmet demand for local talent, issues in attracting talent willing to relocate to Wales, collaboration with local law firms, and the lack of a central LegalTech hub. It is also notable that our mapping activity identified only one start-up or scale-up outside of South Wales. Innovation in Welsh law firms appears to be focused on new products and services, mainly in the areas of client portals, law firm apps, and specialised apps and portals for specific areas of practice. Position innovation is also present, with several law firms seeking to reposition themselves as technology-enabled firms, through involvement in legal education, support for professional collaborations, and recruitment of IT staff, legal engineers and developers. Process innovation appears to lag behind, at least on the basis of information publicly available, and we have not detected examples of paradigm innovation. Once again, we see innovation concentrated mostly in South Wales and in medium and large law firms. Universities in Wales have increased their LegalTech offering in recent years, with two postgraduate courses, a variety of undergraduate modules in most institutions, and modern research centres that support interdisciplinary research and collaboration between academics and industry players, at least in South Wales.
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