Conclusion
Our report has highlighted examples of legal innovation within each of the layers that constitute the Welsh LegalTech ecosystem: start-ups and scale-ups, law firms, and universities. We have encountered LegalTech companies that develop world-leading technology, e.g. for client identification and due diligence, in Wales, benefitting from substantial business support, access to Welsh Government, and a pool of local talent. We have identified a variety of ways in which Welsh law firms are involved in innovation, including through their own apps or portals, or via new forms of engagement with existing and prospective clients. And we have reviewed the fast-growing landscape of LegalTech education in Welsh universities, which shows notable examples of potentially transformative initiatives in teaching and research. Notwithstanding these promising findings, we have encountered the same issues raised in previous research on innovation and technology in Wales, including the concentration of innovation in South Wales, the lack of involvement of small and medium law firms, and the overall lack of coordination between the various layers of the ecosystem. It appears that legal innovation, in Wales, develops at variable speeds: in the fast lane, disruptive start-ups and major law firms compete successfully in the UK and worldwide LegalTech market; in the slow lane, small and medium law firms, especially in South Wales, look at adopting commercially-available LegalTech but encounter cost- and risk-related challenges; on the hard shoulder, many law firms and other businesses, in particular in rural parts of Wales, have little to no involvement in legal innovation and risk lagging behind in competitiveness and efficiency. This situation presents a unique opportunity for Wales. While innovation is normally seen as an individual (i.e. at the level of a single company, law firm, or university) effort – a view that results in the variable speed lanes just outlined -, it is possible to develop a sector-level view of innovation. It is in this shift in perspective that lies the unique opportunity for Wales to become a global leader in LegalTech, leveraging the strengths of the ecosystem to rebalance its weaknesses. To achieve this goal, we have suggested a circular innovation approach that involves three main engines of circularity: expertise, knowledge, and market. Within each of these, the innovation capacity of the sector is greatly enhanced by extensive collaboration between all the layers of the ecosystem. In such a model, it is not necessary for an individual law firm, commercial company, or university to be already involved in legal innovation: its contribution may be found in other areas, such as the sharing of experiences, business needs or data, the engagement with relevant stakeholders, the participation to training opportunities, and more. Any form of collaboration, therefore, becomes an opportunity for knowledge-sharing, to the mutual benefit of the entire ecosystem, supporting sustainable and inclusive growth in legal innovation in Wales. Transforming Wales into a global leader in LegalTech would create unique opportunities for economic growth, employment of highly-qualified local talent, and increased competitiveness for the entire sector. Most importantly, these opportunities would not be limited to those start-ups, law firms and universities that are already involved in legal innovation; rather, they would reach all those players, including small and medium law firms in rural Wales, that have so far been directly or indirectly excluded from legal innovation. In different, but equally important, ways, each part of the Welsh LegalTech ecosystem would be
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