Issue 36Weekly Update

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UK Investment Markets

Investment into UK legaltech sector has grown by £60m in 5 years

According to the Legaltech Startup Report 2019, UK legal technology startups received £61m in investment last year, nearly tripling the £22m that was injected into the sector during the 12 months prior.

The research findings show that investment into these companies has skyrocketed in recent years, seeing a substantial increase from the less than £1.5m that was invested in 2014. The figure moderately crept to £2.5m in 2016 and has seen dramatic growth since then.

Legaltech startups have received at least £62m during the first nine months of 2019 which has already surpassed the entire total for 2018.

The UK is the focal point in the European legal technology market, with UK companies accounting for almost half (44 per cent) of all startups in the EU. This is almost double Britain´s share of the European legal services market (23 per cent).

Investment into 34 of the UK´s fastest-growing startups in the legaltech industry is tracked and analysed by Thomson Reuters and Legal Geek. These businesses gained more than £175m over the last five years with 70 per cent (£122.5m) invested since the start of last year.

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London-based software company, Tessian, is the epitome of the UK´s legaltech sector. They utilise machine learning to safeguard law firms from potential data breaches. This year, they accumulated a record $42m (£33.5m) in investment following its expansion into the American market.

Similar company, Luminance, also uses machine learning to assist lawyers in their analysing of data and contracts. They received $10m (£8m) in funding from businesses including Magic Circle law firm Slaughter and May.

Vice president of customer markets at Thomas Reuters, Jim Leason, said: “The UK benefits from a unique mix of a large

tech and data science talent pool and world-leading law firms as well as easy access to capital through financial markets.”

He continued: “Legaltech is now attracting funding from a variety of sources, including law firms themselves, private equity and venture capital funds. This interest has given startups the crucial leg-up they needed to take their products quickly through to the next stage of development and testing.”

Mothercare creates plan for UK administration and threatens 2,500 jobs

The retailer of baby and child products made a loss of £36.3m last year after failing to find a buyer for 79-shop operation.

Mothercare said that the 78 British stores were “not capable” of maintaining an adequate standard of profitability and that there hasn´t been interest expressed in buying the UK stores. The retailer knew that it would not bounce back to profit-making levels after the multi-million-pound loss.

The shops will remain open for business until administrators have been appointed and confirmed to wind down the company.

Read More: Mothercare creates plan for UK administration and threatens 2,500 jobs

Labour’s £150bn investment plan for schools, hospitals and council homes

Shadow chancellor, John McDonnell, will announce Labour’s new spending pledge during a speech in Liverpool on Thursday.

The latest plan constructed by the Labour government has pledged £150bn for the improvement of schools, hospitals and low-cost homes after promising that the party’s investment in infrastructure would get to £350bn in five years.

Labour has stated that they would deliver an “irreversible shift” of power and investment to working people outside the south-east of England if they win the election on December 12.

Read More: Labour's £150bn investment plan for schools, hospitals and council homes

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Investment in UK quantum computing to triple in next

five years

According to the CBI and Accenture Tech Tracker survey, UK business investment into quantum

computing is expected to triple over the next five years.

Other sectors in new technology that will be focused on include blockchain and other

distributed ledger technologies and artificial intelligence (AI).

UK companies believe these technologies to be a substantial way to get ahead of the competition.

When asked to rank six reasons for technology investment – from one to six with one being the most important – businesses put growing their competitive advantage as the most important,

followed by boosting productivity.

Read More: Investment in UK quantum computing to triple in next five years

ARLA Propertymark publish their election manifesto

Ahead of the publication of the main parties’ manifestos for the forthcoming General Election, Propertymark joins the RLA in publishing its own manifesto, calling on the new Government after the 12th of December to reform the housing sector.

Top of Propertymark’s hit list is the regulation of property agents, and is calling for the new Government to take forward the recommendations of the Regulation of Property Agents (RoPA) Working Group chaired by Lord Best.

Regulation, says Propertymark, “offers huge potential to professionalise the sector through a code of practice, licensing and qualifications.”

Read More: ARLA Propertymark publish their election manifesto

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Minister takes rent controls off the table

In a pre-election boost for buy-to-let landlords, housing secretary, Robert Jenrick has indicated that he is not in favour of rent controls in the private rented sector (PRS).

This comes as officials have been discussing ending section 21 possession orders, the two-month eviction notice that landlords can use to end a tenancy without having to give a reason – the so called “no-fault” eviction process.

Previous, restrictions on rent increases in the PRS had been mooted as part of the Government consultation on section 21 by a Housing, Communities and Local Government select committee.

Read More: Minister takes rent controls off the table