This 20-page pitch deck helped legal tech company Disco rake in $60 million from investors like Georgian Partners and Bessemer Venture Partners

  • Disco is a cloud-based ediscovery platform that uses AI to help lawyers more efficiently sift through hundreds of documents in the litigation process.
  • In its latest round of funding in October, the startup raised a massive $60 million from investors like Georgian Partners and Bessemer Venture Partners, bringing total investment to date to $195 million.
  • In an exclusive interview, Kiwi Camara, Disco's CEO and cofounder, walked Business Insider through the pitch deck it's used to make its business case to both investors and clients, which include Fortune 1000 companies and Am Law 200 firms.
  • Visit Business Insider's homepage for more stories.

Cloud-based technology is having its moment, especially in the legal industry.

As attorneys have been propelled to work remotely amid the pandemic, data security and streamlined work processes are top-of-mind for law firms, leading them to adopt cloud technology. A recent Clio report found that nearly 80% of respondents use cloud storage — and 96% plan on doing so moving forward.

Investors are taking note. Disco, a cloud-based ediscovery platform that uses artificial intelligence to streamline the litigation process, snapped up $60 million in equity financing this October.

Its Series F, led by Georgian Partners and also backed by VC titans like Bessemer Venture Partners and LiveOak Venture Partners, brings total investment to $195 million, valuing the company at $785 million.

Launched in Houston in 2012, Disco offers AI-fueled products geared towards helping lawyers review and analyze vast quantities of documents, allowing them to more efficiently determine which ones are relevant to a case.

"We're leveraging this basic idea that we want lawyers to spend their time working on the things that only they can do. And we want technology to automate away the boring, mundane, and repetitive tasks," explained Kiwi Camara, Disco's CEO and cofounder.

Read more: Meet 10 investors who are pouring money into legal-tech startups, from Silicon Valley VCs to Big Law firms

Camara walked Business Insider through the pitch deck the company used to attract its blockbuster funding from investors, as well as sign on clients, ranging from Fortune 1000 companies' legal departments to attorneys at 75 of the Am Law 200 firms.

Here's an exclusive look at Disco's deck.

Lay out Disco's vision

Camara kicks off his pitch with Disco's vision: "Every company spends a lot of money on legal. But if you look at legal, there really isn't a big technology company that's building software to help power the legal department," he said. "We aspire to be that category creator."

Ediscovery is a $12 billion space, and is predicted to exceed $20 billion by 2024, according to Camara. The basic problem that Disco tackles arises when there's a situation like a dispute between big companies or a government investigation. "Lawyers have to go through huge volumes of corporate data — emails, documents, Slack messages, Zoom recordings — and find the documents that need to be produced to the other party," he explained.

With Disco, all the documents are shipped onto the cloud, in a user interface that Camara described as similar — and as intuitive — as Gmail or Instagram. Two years ago, the company launched its second product, Disco Managed Review, which uses AI and a team of in-house lawyers to help further expedite the document review process, doubling productivity, according to Camara.

Illustrate the growth of the company's products

Though the specific dollar-figures on the y-axes have been removed for the public-facing version of the deck, the graphs demonstrate the growth and scale of Disco's products. Camara said that Managed Review has grown fivefold over the past year, hitting an eight-figure value at 500%.

Read more: 'This is adapt or die time': Tech-savvy law firms make nearly 40% more in revenue than old-school ones — here's how new tools are helping lawyers get ahead

Demonstrate Disco's value to clients

Ultimately, it's all about the end-user, and whether Disco has made document review as easy and painless as possible for them. The Net Promoter Score (NPS) is a good measure of how clients are scoring the overall experience of using its products.

Disco surveyed its entire customer base in December 2019, and found that more than half of respondents gave it full scores.

Introduce the team and its mix of backgrounds well-suited to the company's vision

"This is something we really leaned into with investors," said Camara, especially given the specificity of the legal domain. Disco's team has a mix of people with experience in law and with software companies. Camara himself has both a bachelor's degree in computer science and a law degree from Harvard Law School.

Show the use cases of your products

There are three primary use cases of Disco's products: litigation, government, and internal investigations, and other legal reviews, including data breach, third-party subpoenas, and FOIA requests.

Though Disco's primary clients are corporate legal documents, attorneys at law firms, the government, and plaintiffs lawyers are all part of the user base. "It's anyone dealing with legal problems, really," said Camara.

Read more: Check out the 14-page pitch deck that a contract-editing startup used to nab $3.2 million from investors including DocuSign

The big one: Why you should switch to using Disco

"This is the money slide for clients," Camara said, outlining the key selling points to companies on why they should switch to Disco.

Although Disco's software itself isn't cheaper — it's typically priced at a premium — companies do save on lawyer fees for document review, which can cost three to five times as much as ediscovery. On top of that, lawyers can resolve their cases much more quickly, demonstrating the value of the cloud for clients.

Explain how the AI technology boosts document review

Camara then explains how Disco uses AI to speed up document review. Each of the grey boxes are documents, and the green ones are the good ones — the ones that matter. The sparsity of these documents, as illustrated in the graphic on the left — makes the work "unpleasant" for junior lawyers.

With the help of technology, however, the AI algorithm is able to recognize the green documents and "push them to the top," enabling those lawyers to make better use of their time, explained Camara. The red line shows that, after going through 30% of the documents, you've found all the good ones. The Disco model then does a random sample of the rest of the documents to ensure statistical confidence of this.

Camara said that the algorithm requires 50 examples of the documents you're looking for to begin generating relevancy scores. By the time it's gone through 500 documents, it hits an accuracy level of mid-80%.

Show that clients can re-use these AI models for greater efficiency

"Let's say you're a big company that deals with certain cases, whether it's patent infringement or government investigations, all the time," said Camara. "Instead of starting from scratch, you can re-use the models."

Bring everything together to clearly demonstrate the impact of the technology

Camara uses the example of the massive, multidistrict opioid litigation to clearly illustrate the value of Disco's AI technology. "There are dramatic savings for the client," he said.

Explain why you have (three) legs up against your competitors

Competitors have to catch up on not one, not two, but three dimensions in which Disco has established strengths in. "Each of these is really, really hard, but doing all three together is, we think, pretty close to impossible," said Camara.

 

Identify the space that Disco occupies in the legal market — and how it plans to expand

The grid represents the legal market, with the rows showing all the things that lawyers do, and the columns the various parts of the legal process, from figuring out the applicable rules of law to managing workflow. 

"Each of the intersections is an opportunity for technology and productized legal services like Disco," explained Camara, who added that ediscovery is a high-growth area. "Over time, the goal is to fill up more of the grid."

Read more: These 9 legal tech startups are poised to take off as law firms look to cut costs and boost productivity, according to top VCs

Share your main strategy for growth

This is what Camara describes as Disco's "usage-based business model" — essentially, their main strategy. "We started with one product, deliver a great client experience. These clients will then want to buy more of our products, and we can capture a larger and larger share of the market," he told Business Insider.

Explain Disco's strategy by showing how much customers have used its products over time

Demonstrate your company's values

"This was very important to me when we got started. We didn't want to build a company solely for the purpose of selling it, flipping it, or taking it public," said Camara. "I really think there's an opportunity for legal to build a big and lasting standalone company, like Salesforce has done for the sales function."

"Magic" is also what Camara sees as his goal: "We want to build something that feels like magic when our clients use it."

Drive home your vision, value, and plans for growth

Camara wraps up his pitch by driving home Disco's vision, business value, and plans for growth.

"We're the market leader in cloud discovery, and we're just getting started," he said, describing his mission to be a "category-creating company," similar to what books were to Amazon — the launchpad for a long-term strategy of continued growth and expansion.

Camara said that his short-term goal is to focus on Disco's three existing business lines and scaling up the market by expanding both geographically and through relationships with Fortune 1000 companies.

In the long-term, Disco is looking to expand through strategic mergers & acquisitions. In fact, Camara told Business Insider that they've just hired someone to help with that.

"It's an exciting time to be in legal tech. Nobody wanted to invest for a while, not because lawyers aren't excited to use technology, but because the products just weren't there," Camara said. "What you need is a product that speaks to them — and feels magical to them."


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