We’re thrilled to announce our investment in Doormat, a company using technology to revolutionize the Canadian real estate law market.
At The LegalTech Fund, we have been closely watching as national and state-level regulations change around legal service delivery. These rule changes are enabling innovative business models within the legal industry and allowing broader participation in profits. Driven by an increasingly price-sensitive market and pervasive inequities in access to justice, deregulation facilitates development of tech-driven solutions that make legal services more affordable, efficient, and consumer-friendly. Across the UK, US, and Canada, regulatory bodies have taken up the mantle of legalization for alternative business structures (ABS), or nonlawyer involvement and investment in legal services. The UK has the most developed framework to date; the Legal Services Act passed in 2007 and is now home to over 1,500 ABS firms, with the majority listing technological innovation as critical to their business models. In the US, Arizona and Utah both have ABS sandboxes and close to 100 operating entities between them. In Canada, British Columbia and Ontario are leading the charge through their respective pilot programs.
Through these liberalization efforts, we see a future where legal services can be provided in a technology-first manner. Our newest investment, Doormat, has a mission aligned with that thesis. The company provides clients with a fully digital and seamless real estate closing experience, without losing the benefits of legal expertise. The software automates the tedious administrative tasks, such as document collection, identity verification, KYC, and even document summarization. This way, lawyers are leveraged only during the critical points in the process, so customers not only get a better experience, but they also pay less. We believe Doormat has the potential to become a recognized brand and a leading provider of real estate law services in Canada.
Doormat's solution addresses the manual and opaque nature of the real estate law process in Canada by flipping the traditional legal service business model on its head. The company is part of Ontario’s Access to Innovation program, which was developed to explore innovative delivery of legal services via technology. Through this program, Doormat can offer its services directly to consumers. Now, instead of going to a law firm first, customers go to Doormat first. Technology is at the forefront, where clients have access to an intuitive and personalized dashboard, and lawyers are leveraged in the background. The tool collects and centralizes all the necessary information from the client up front, presents tasks to the clients, allows them to track their transaction in real time, and provides access to legal expertise as needed. Clients gain clarity on the transaction with document summaries and timelines, enabling them to feel confident that their transaction is being worked on and giving them more transparency into the process. This simplifies the transaction for both buyers and sellers during property purchases, sales, refinancings, and ownership changes.
We’re excited to back the Doormat founders, who bring a combination of industry and technical skills that uniquely equip them for this endeavor. Ben's experience as a real estate lawyer, during which he has helped close over one thousand transactions, ensures that the platform complies with legal regulations and delivers the necessary functionality. Robert’s engineering expertise, acquired during his time as one of the youngest senior engineers at Shopify, helps prioritize a client-focused and scalable approach to building the software and Joel's experience in business strategy and operations from RBC enables effective management of the company's growth.
Please welcome Doormat to The LegalTech Fund family and let us know if we can connect you to learn more.