[Startup Bharat] This legaltech firm is helping companies automate contract management with its AI/ML solution
Goa startup The Legal Capsule has over 100 corporate clients, and has managed more than 10,000 contracts since it was founded in 2019.
For most businesses, managing contracts such as legal, IT, or finance manually is not only risky, but a time-consuming process. Drafting, reviewing contracts, procuring stamp papers from vendors, printing, physically signing, and storage increases risk of missed deadlines, renewal issues, and failure on compliance and obligations, says Gautami Raiker, Co-founder,.
To help enterprises manage contracts efficiently, Gautami along with Shravan Hegde founded The Legal Capsule (TLC) in 2019. The Goa-based startup streamlines and automates the process of managing contracts in one place.
Since inception, the startup has onboarded over 100 corporate clients, and has managed more than 10,000 contracts. Some of its clients include Bajaj Finserv, HDFC Ergo, MG Motor, Bridgestone, Brevistay, Probus Insurance, Wow Express, Vidcom, relipay, and T-hub.
“Most of these organisations have a manual process to manage a contract. They draft it in MS Word and then negotiate over emails. Once the emails are exchanged, one has to go through the process of actually procuring stamp paper from the vendors. While Delhi NCR has e-stamping, there are many states that still have manual processes of procurement. By sending the contract through shipment for signatures and then storing them in physical format, it becomes very difficult to keep a track of renewals,” explains Gautami, who founded LawMate.in in 2016.
How it started?
While working as a legal executive at a startup incubator in Goa, Gautami noticed the gaps in the space that could be bridged by technology. She met Shravan at the startup incubator and immediately realised that they shared the vision for The Legal Capsule and the solutions it can provide.
“I realised that startups do not have access to legal services for businesses or an understanding of compliances, which are to be met. This is how I came up with the concept of LawMate.in, which was going to be a one-stop platform for all the legal compliances for startups and small and medium enterprises (SMEs),” says Gautami.
In 2018, Gautami realised how documentation, especially contracts, are usually handled in an unstructured manner by organisations. This gave her the idea for document automation, which translated to The Legal Capsule.
How it works?
The Legal Capsule is an AI-powered Contract Lifecycle Management Platform that assists enterprises, particularly the SMEs and large-scale companies, to manage contracts on a single platform.
The B2B startup helps with drafting the contracts, seeking internal approvals, negotiating clauses with counterparties, e-signing legally binding signatures, e-stamping modules for states across India, and storing these contracts on a single repository.
The platform offers a subscription model to its clients, and the cost of the services provided depends on the volume of contracts that will be managed by the platform and is done on a case-by-case basis.
It uses AI/ML to analyse the reported findings and offers blockchain-powered solutions that capture signatures, live photographs of the document being signed, GPS details, IP address, and date and time of signing the contract.
As of now, the startup faces competition from companies like SimpliContract, Plunes, and SpotDraft.
“What differentiates us is a clear contract visibility, better negotiation process with automation, and India-specific jurisdiction based legal process for contract management,” says Gautami.
The market and funding
According to Valuates Reports, the global legal service market was valued at about $680 billion in 2021, and is estimated to reach $824 billion by 2027, at a CAGR (compound annual growth rate) of 2.3 percent during 2021-2027.
In May 2022, TLC raised an undisclosed amount of funding from Hyderabad-based SucSEED Indovation Fund and angel investors like S Ramadorai (Former CEO of TCS), Kiran Deshpande (Former CEO of Tech Mahindra), Ravi Nigam (Founder and Former MD of Tasty Bite), Shashank Deshpande (Managing Partner at Pentathlon Ventures), Vineet Patni (Managing Partner at Wepartner Consult), Shantanu Deshpande (Founder of Bombay Shaving Company) among others.
“Legal Capsule has grown its revenue by over 4X in the past one year. It has a massive and expanding total addressable market (TAM) equal to $25 billion, which includes an e-signature market of $20 billion and Contract Lifecycle Market of $5 billion,” said VVSN Raju, Co-founder of SucSEED Indovation Fund, at the time of funding.
With a team of 14, The Legal Capsule is now looking to raise another round of funding in the current financial year. It plans to use the funds for global expansion by onboarding companies from across the world.
Edited by Megha Reddy