CFO says LegalZoom will add scale, new hires after market debut
Print/DownloadNasdaq logo displayed at the Nasdaq Market site in New York September 2, 2015. REUTERS/Brendan McDermid
- Company mission is to “democratize law”
- Plans to add two more offices, hire tech talent
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Shares of LegalZoom began trading publicly on Nasdaq on Wednesday, ending the day 35% above their offer price to value the online legal services company at more than $7 billion.
After the IPO, growth is on the agenda for Glendale, California-based LegalZoom, chief financial officer Noel Watson told Reuters Wednesday morning. He cited plans to hire, add offices and scale up operations with marketing, new offerings and a focus on partnerships.
The company says it aims to “democratize law,” offering services for businesses and their owners including business formation and operation, intellectual property, wills and trusts and estate planning. It helped form 10% of new LLCs and helped incorporate 5% of new corporations in the United States in 2020, according to its registration statement filed with the U.S. Securities and Exchange Commission.
LegalZoom isn’t the only legal tech-related company to go public on Wednesday. Palo Alto-based Intapp Inc, a software provider for professional financial services firms – including legal – also began trading on the Nasdaq, and rose 3% in its debut.
Asked whether the market understands the investment opportunities opening up in legal services, Watson pointed to the promise of technology.
“I think what investors see is an industry that really is one of the last large industries that’s yet to have significant technological disruption,” Watson said.
“A lot of the activity still happens ‘offline.’ And when you think about legal services, in general… the majority of people have at least some level of their legal needs unmet,” he said.
That’s partly due to complexity, cost and knowing where to get the right legal support, Watson said. “People believe that technology can be leveraged, and this is our goal, to simplify the process, to connect you to the right resources that can help you with your needs, and to make it affordable so that it is accessible to a much broader percentage of the population,” he said.
Watson said LegalZoom plans to hire in several areas, in particular in technology and development, to bring on people who can help the company “drive continued innovation and automation and improvement in the user experience and our product.”
The company’s primary offices are in Glendale, which is in the Los Angeles area, and in Austin, Texas, he said. LegalZoom intends to open an additional Los Angeles area office, and one in Silicon Valley, which will “open the doors to additional talent,” Watson said.
LegalZoom also plans to scale up its operations, investing in marketing efforts and in “adjacent offerings” for businesses, which are still in early stages, Watson said, citing its new tax and bookkeeping offering, LZ Tax, launched last year.
Asked if the company intends to merge with or acquire other companies, Watson said inorganic growth may be part of the company’s growth strategy, potentially with small acquisitions that add “incremental services” to expand its offerings. The company also sees opportunities for growth through partnerships with other brands.
A Cooley team led by C. Thomas Hopkins advised LegalZoom on its IPO, while Latham & Watkins represented the company’s underwriters.
(This story has been updated to correct a typo in the name of LegalZoom’s tax and bookkeeping product, LZ Tax.)
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