I think it doesn’t take a Krugman-level economist to have predicted that with the rush of new companies into the SaaS practice management space, consolidation would be inevitable. While there would seem to be plenty of room for growth in the legal cloud practice management space, the rush to market inevitably means some companies with lesser funding, ideas not as well thought out, inadequately executed marketing, and a message that isn’t distinctively compelling will fail. And it’s happened.
Clients are regularly asking us to take out a crystal ball and advise them on which SaaS providers – whether practice management companies, billing providers, or generically horizontal companies like backup, storage or e-faxing – will actually survive. I tell them that crystal ball is extremely murky and that anyone who takes a definitive stance at this point is a gambler, plain and simple. That’s not to say we’re not recommending services like Clio, Netdocuments, Dropbox, Metrofax and others. But they recommendations always come with an overt caveat about prospective company longevity: “we just don’t know.” While the odds favor some of these companies v. others, the long-term jury is still out.
Expect other failures to follow as the range of companies matures and Darwinism takes hold, with the fittest surviving and thriving. Who will survive? Who will fail? We’ll see. But the one certainly in the legal SaaS marketplace is that more shaking out is ahead.
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