In a deal that is sure to shake-up the already hyperactive market for law practice management software, AffiniPay, the parent company of the electronic payments platform LawPay, has acquired the law practice management company MyCase.
Not only are LawPay and MyCase among the most widely used products in their respective sectors of e-payments and practice management, but MyCase has also acquired four other practice management products over the last year or so: CasePeer for personal injury firms, Soluno for billing and accounting, Woodpecker for document automation, and, just last month, Docketwise for immigration practices.
In an exclusive LawNext podcast interview with Dru Armstrong, CEO of AffiniPay, and Jim McGinnis, CEO of MyCase, Armstrong said that LawPay had been looking to expand beyond payments ever since she joined as CEO in July 2021.
Listen to our podcast interview:
“We spent a lot of time weighing our strategic options and just fell in love with the MyCase platform,” she said. “It’s simple, it’s powerful, its customers love it. A lot of the same things they love about LawPay, they love about MyCase.
“I have to tell you, I am beyond excited to be working with Jim and team. We’re just culturally aligned, we see the world the same way and, frankly, we all just believe that we want to put the lawyer first.”
The market share of the combined companies is among the largest in legal tech, with a customer base of 65,000 law firms and more than 200,000 legal professionals.
While both companies’ customers are primarily solo and small law firms, AffiniPay also serves 40% of the Am Law 100 as the result of its acquisition last year of ClientPay, a digital payments platform for larger firms.
All employees of MyCase and of the companies it acquired will remain with AffiniPay, doubling AffiniPay’s workforce to 500. McGinnis will move into the role of president of growth initiatives, overseeing sales and marketing, while continuing to work with the MyCase group of products.
(Tomorrow, Armstrong and McGinnis will join our Friday Legaltech Week journalists’ roundtable to discuss the acquisition. If you are interested in learning more, join us this Friday, June 10, at 3 p.m. ET. You must register here.)
Making Sense for Customers
When I interviewed Armstrong shortly after she joined AffiniPay last year, she said then that she anticipated that LawPay would expand out of just payments, but that it would do so only if it made sense for its customers and made the products better together. In our interview this week, I asked her how this deal fit that condition.
She said that LawPay, after spending a lot of time thinking about its customers’ needs, concluded that law firms’ financial needs and business needs go hand-in-hand. While, for many firms, payments is the first piece they put in place, they also need practice management software to manage the business and workflow aspects of their firms.
“So, when we were able to really dig in, we saw that MyCase’s LPM and LawPay’s payments and fintech platform really would unlock tremendous value, not just in the near term in terms of being integrated, but also in our ability to really innovate, and chip away at that time-to-value problem that all of our customers face, so that they can really have a practice that thrives.”
Already, LawPay’s integration within MyCase is live. In addition, MyCase is preparing to launch integrated accounting with the platform, based on the technology it acquired through Soluno.
“I believe truly this is a marriage made in lawtech heaven,” McGinnis said. “By coming to the market together, we’ll be able to accelerate the profession’s move to the cloud, and to an end-to-end, all-in-one workflow and payment solution.”
The combination also gives the companies access to deeper levels of data that will help them better understand law firms’ pain points and how best to address them, Armstrong said.
“We’re going to have a lot more intelligence around the invoice, around the financial needs of the business, and that’s going to make us be able to innovate more deeply and more quickly to really serve our customers.”
Opportunities for Growth
While the combined companies will now serve some 65,000 law firms, almost half of those firms do not have a law practice management platform, Armstrong said. Further, of those customer firms that do not have LPM software, 40% want to adopt a platform, she said. Overall, only about 30% of solo and small firms have adopted any sort of LPM software.
“They’re getting to that tipping point where they’re recognizing that technology can really help them run their practice better,” Armstrong aid. “Our view is, they built a ton of trust of trust with us, they’ve actually asked us for our recommendation, and after surveying the market, we believe we’ve picked the absolute best legal practice management. ”
Added McGinnis: “I think we’ll be able to go faster and bring more innovation and more capability to our customers than any other platform or any other competitor because of the deep expertise of the two teams in each of the realms.”
But even as the company aims to grow, it will maintain its focus on solo and small firms. In the larger firm segment, where AffiniPay owns ClientPay, AffiniPay will not seek to expand into practice management, but rather will continue to work with its integration partners in that segment, which include Centerbase, Litify, Aderant and Thomson Reuters, Armstrong said.
It will also aim to continue to provide products that recognize the differences among law practices, Armstrong said.
“We absolutely fell in love with the technology stack that the MyCase team has built and have absolute conviction, not only in MyCase, but in the platforms and products that they’ve acquired,” she said. “We fundamentally believe, if you put the customer at the center, while there’s a lot of similarities among attorneys, there’s also a lot of differences in terms of practice area, size of firm, etc. So our commitment to our customers is that we’re going to continue to invest in these amazing software platforms, we’re going to continue to invest in fintech and innovation, and we’re going to invest in their deep integration.”
Impact on LawPay Customers and Partners
The acquisition raises the question of what happens to LawPay customers who use its software through practice management platforms that compete with MyCase. Armstrong said she is committed to supporting those customers and those other companies.
“If you put the customer first, then you also believe in customer choice. Customers will be able to use LawPay standalone, they’ll be able to use it integrated with MyCase, but equally important, we’re absolutely committed to our partner ecosystem, we’re absolutely committed to not just maintaining, but continuing to invest in our integrations.”
As LawPay continues to build out features on its core platform, it will continue to build out more APIs to give its partners access to all those features, Armstrong said.
“Our customers who are using us in conjunction with another platform should have no fears that we’re going to do anything to disrupt that. If anything, we really want to give them an embarrassment of riches in terms of choices, and then let them make the choice based on their practice, their business needs, their workflow.”
In our interview, I asked Armstrong and McGinnis about what they see as next for this combined company.
McGinnis said the trajectory is a clear four-step platform: First, help lawyers get in the cloud; second, enable them to be on a single platform with all their data in one place; third, provide automation of workflows so legal professionals can get things done without doing it themselves; and finally, apply advanced technologies such as artificial intelligence.
“Our vision,” added Armstrong, “is that ultimately you can do all that within our platform, using intelligence, using automation, bringing together — whether we own it or we integrate it — all the key pieces that drive the legal workflow and the financial needs of the practice in a single place.”
TA Associates, the private equity firm that is AffiniPay’s majority investor, supported this deal with additional investment capital, and remains the majority owner of the merged company. Apax, which purchased MyCase in September 2020 for $193 million, will become a minority investor and take a seat on the board.
Other minority investors include Amy Porter, the founder of AffiniPay, and certain unnamed employees of both MyCase and AffiniPay.
In AffiniPay’s acquisiton of MyCase, Armstrong said, she sees an opportunity to carve out a clear place as the category leader in law practice management.
While both brands are well known and well respected, she said, they do not plan to rest on their laurels, but rather to continue to grow and innovate.
“We’re super excited for what’s to come. There is a ton more to do in tech and fintech. You’ll see us leading the way.”
- Learn more about MyCase on the LawNext Legal Technology Directory.
- Learn more about LawPay on the LawNext Legal Technology Directory.
- How It Works: MyCase, Practice Management Software that Enables Law Firms to Run from Anywhere.
- See all stories about MyCase on LawSites.
- See all stories about LawPay on LawSites.