The North East looks set to become a major player in the legal technology arena.

A new report from LawtechUK, the Ministry of Justice-backed initiative, charts the sector's evolution from 37 companies in 2002 to a robust ecosystem comprising 356 companies in 2023, with investment projected to hit £2.2 billion annually by 2026.

In the North East, it reports that  there are four dedicated lawtech companies already, with the region showing 'a remarkable commitment to transforming the legal industry through technology, contributing to the national narrative of growth and diversification.'

In the report’s foreword, Mike Freer, Parliamentary Under Secretary of State for the Ministry of Justice, said: “The tracker highlights our home-grown talent with 254 of those being UK-founded, whilst also showing the continuing attraction of the UK as a destination for international businesses.

The UK is a uniquely supportive environment for lawtech innovation due to its flexible regulatory framework, world-class legal services sector, deep technological expertise, and entrepreneur-friendly business environment. Alongside LawtechUK, a rich network of innovation labs, law firms, universities and businesses all playing an important role.

 

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The report shows an emphasis on B2B solutions, with 68% of UK lawtech companies focusing on catering to the needs of businesses. This trend highlights the sector's role in transforming traditional legal processes and operations, providing tools and platforms that enhance efficiency, reduce costs, and improve the quality of legal services for businesses, from automating mundane tasks to offering sophisticated analytics.

In the past five years, LawtechUK has also reported 26 new female-founded companies, with 14.3% of UK lawtechs in the tracker having at least one female founder.

There is also a significant push towards harnessing generative AI for legal innovation, ensuring its application is secure and ethical. Deregulation, especially post-Legal Services Act 2007, is seen as key to encouraging sector growth.