Clio raises USD $900 million at a $3 billion valuation — making history in Canada and globally

Clio, the Burnaby-based legaltech unicorn, has raised USD $900 million at a $3 billion valuation in a Series F round, led by New Enterprise Associates, with participation from Goldman Sachs, Sixth Street, Tidemark, and CapitalG.

According to the company, the deal marks the “largest capital raise and equity value for cloud legal software ever, and a top five largest capital raise for a vertical market software company in history.” It’s also the “largest software capital raise and equity raise in Canadian history.”

Clio will “continue to expand its multi-product platform, including further investments in its burgeoning AI portfolio and integrated legal payments. It will also accelerate its rapid market expansion upmarket and internationally, deepening its organic growth to more than 130 countries across the globe.”

To date, Clio is the legal industry’s only end-to-end software solution for law firms, supporting every aspect of the client journey from intake to invoice. The company centralizes its many products, from legal payments to technology integrations and legal workflows, in one operating system — serving over 150,000 customers in 90 countries.

Among Clio’s other milestones are doubling its ARR to over USD $200 million compared to 2022, expanding internationally to the APAC region, and growing its payments business — processing billions of dollars annually in legal-specific transactions. Clio also now has over 1,100 employees in North America, EMEA, and the APAC regions.

Founded in 2008, Clio has come a long way from its scrappiest days. CEO Jack Newton started the company alongside his grade-school friend Rian Gauvreau after he moved to Vancouver to work for law firm Gowlings.

At the time, in the corporate world, Amazon, Salesforce, and LinkedIn had all become major players. But within the legal space, technology was far behind in being implemented. “Lawyers were still doing their job like it was 1958,” Newton shared in a blog.

With Gauvreau observing the pain points firsthand, he and Newton decided to create a solution. The two set out to consolidate and streamline the practices that remained painfully manual. To them, it wasn’t just a corporate need but societal need as well given how critical the legal space is to society. “Seventy-seven per cent of individuals do not have access to lawyers to help them see good legal outcomes for their problems,” Newton highlighted.

Following the launch of Clio, the company gained some early traction but was quickly running out of the $100K raised from a friend and family round. It was the middle of a global financial crisis, and payroll was coming up. 

Despite the circumstances, Newton and Gauvreau would turn away a major and the only investor interested in supporting them. Instead, they financed the company through Newton taking out a mortgage on his house, credit cards and other debt, and limiting costs however possible — from driving to Seattle for cheaper flights to returning computers after trade shows.

Ahead of today’s announcement, Newton sat with the Vancouver Tech Journal to share what he’s most proud of, what’s been formative in shaping Clio’s success and what can be expected next, as well as advice for other startups looking to become a leader in their space.

What are you most proud of today when you look back on the early days?

We've had a substantial impact on transforming what I view as one of the most important industries and professions on the planet, and that's the legal profession. If you think about it, the legal profession in many ways supports the fabric of our society. Access to justice and legal representation is something I believe should be a fundamental human right.

I believe technology can be a profoundly important aspect of improving access to justice. When you look at Clio's 16-year history, our so-called dent in the universe has been to drive substantial transformation in the legal industry.

Helping to drive the adoption of cloud-based technology across law firms. Helping to make law firms dramatically more efficient. Helping them deliver dramatically improved client experiences to their clients. And helping to improve access to justice and reduce the friction typically involved in working with a lawyer. 

In many ways, we still feel like we're just getting started on that journey, but I'm very proud of the progress we've made as a team at Clio over the last 16 years and of our success in realizing our mission to transform the legal experience for all.

How have you managed to meet and anticipate future industry demands?

Part of my job at Clio and, I think, all of Team Clio's responsibility is envisioning what the future of the legal practice will look like in 10 or 15 years and inventing on our customers' behalf to make that a reality. 

I think if you're able to strike that balance between listening to your customers about their existing needs and desires, anticipating what they will need in the future and developing those products, you can [give] your customers what they know they want today and what they maybe didn't even realize they needed.

What has been formative in shaping Clio’s culture that contributed to today’s news?

In answering your first question, I was debating between the answer I gave you and something else I'm equally proud of, which is the fact that our culture has sustained, thrived, and grown in a very positive way over the course of 16 years.

When you look at what Clio has accomplished and what I was celebrating in that first answer, none of that would be possible without an incredible culture —a group of people who are aligned and passionate about a common mission and share a set of values about how they want to approach work and realize our mission to transform the legal experience for all. 

Our cultural North Star is to build what we describe as a human and high-performing culture. We invest a lot in development. We have everything from performance coaches on staff to leadership programs that we've developed at the company from the ground up and offer to a cohort of Clions every quarter.

We have a culture that we describe as deliberately developmental career progression at Clio. Our values are an integral part of every hire and promotion, as well as how we set our priorities and decide what the right decision is.

You can actually see a list of our values at culture.clio.com. To share one of them, the value of customer success comes first is a crucial one. Everything we do is for our customers. One of our core ethos is that if we help our customers succeed, we, in turn, will be in a position to succeed as a company, and we really participate in our customers’ success. 

What can you share on what can be expected next from Clio?

This investment round is about thinking about the next stage and scale of growth at Clio. 

We're going to continue investing in the levers that have helped propel us to this incredible growth. So that's continuing to diversify our product offering, expand internationally, doubling down on our payments business [and] pushing into the mid-market — a segment that we've been seeing a lot of success with.

So those are the areas we'll be investing in. I really think about Clio's next chapter of growth as scaling from $200 million of ARR to a billion dollars of ARR.

What advice would you give to other startups looking to become a leader in their space like Clio?

I would say that the journey is full of ups and downs. 

One thing that can be discouraging, and maybe even demoralizing, to early-stage startup founders is sometimes it feels like all you read about in the press is the success stories. There's a certain amount of bias to those stories.

Every story, including Clio's, has many low points. Many investors said no. Many existential crises along the way. So I think you've got to keep going. You’ve got to keep swimming and prevail over all of those low points in order to see the high points. 

Sometimes, it feels like all you ever read about are the success stories and the big funding rounds. Nobody issues a press release for their failures. Know that success is built on the back of a lot of failures and to keep persevering.

Is there anything you want to add to or feel is important to share with our readers?

What we're really excited about is building an industry-transforming tech company in Vancouver. 

Back in 2008, when we were raising some of our first investment rounds, every single investor we talked to said, “We like the idea. We're interested in investing, but you need to move the company to the Bay Area or to the U.S.” At the time, they thought it was basically impossible that you could build a real tech company in Vancouver.

So we're very proud of the fact that we've got a real homegrown Vancouver success story in Clio. A Canadian success story in Clio. And a new story here that’s not just great news on a Vancouver or a Canadian scale, but on a worldwide scale. So, I’m very proud of that.