Red tape is a common source of frustration for companies. But Brazilian entrepreneurs are actually exploiting red tape - and discovering an engine for a whole new legal ecosystem. All this means one thing for start-ups armed with the reams of paperwork and administration: opportunity.
'Bureaucracy is the death of any achievement.'
- Albert Einstein
Or is it? Perhaps ask a Brazilian - they tend to
know a thing or two about bureaucracy.
'It's a very specific problem we have here in Brazil
because we are a huge country - we have over
5,000 cities and each one of these cities has at
least three different institutions from which it is
possible to get different documents. Institutions
like the city hall, the labour department, the
justice department, the environment department,
or the federal government,' says Pedro Roso, CEO
and co-founder of Docket, a legal tech start-up.
And the legal sector itself, says lawyer and tech
entrepreneur Bruno Feigelson, is as swollen and
filled with complexity as it could be. According
to Feigelson, Brazil spends 2% of its GDP on its
legal system, and there are currently 100 million
ongoing lawsuits in the country.
'If you compare that with our population - we
have 200 million people - we have one lawsuit
per person, because you have the plaintiff and
also the defendant,' he explains.
Felipe Monteiro is professor of strategy at
INSEAD, and is also the academic director of
the Global Talent Competitiveness Index, which
identifies the world's most talent-competitive
countries. This has led him to look at how
companies and sectors around the world are
'I remember talking to the CEO of a very large, fastmoving
consumer goods company in Brazil. This is
a very marketing intensive company, and the CEO
said: "Brazil is the only country in the world where
we have more lawyers than marketing people".'
All this means one thing for start-ups armed with
the technology to bat away reams of paperwork
and administration: opportunity.
'If we go to the legal sector, what's happening
is that whereas one company used to have a full
range of activities, a lot of start-ups are coming
and trying to break down the full service into
smaller parts,' explains Monteiro.
'If you think about utilities, BT Group had the
full service but now a lot of start-ups are saying
"Maybe we can use the infrastructure of BT
but start offering different things." You can
think about this as different technologies, but
I think most of all, it is not about that. It is that
you as a person now have different needs.
Maybe an incumbent used to give you all those
options, but now independent players can use
the infrastructure and offer you different paths,
maybe in a more efficient and effective way.'
One company aiming to apply this model to
in-house legal teams and unbundle internal
processes is ProJuris, a start-up currently
enjoying its tenth anniversary.
'There are more than 1.2 million lawyers in
Brazil, which has led to one lawyer for every
190 Brazilian citizens,' says digital marketing
manager Tiago Fachini.
'Our purpose is to eliminate inefficiencies of the
legal routine. We are working with AI in several
ways to help lawyers to be more efficient and
happy. We are also working with automation and
some very neat integrations.'
The company's SaaS (software as a service)
product automates repetitive activities, like
creating or updating cases, creating documents,
or distributing and managing team tasks.
ProJuris also offers software to corporate legal
teams designed to improve productivity of the
teams who work with contracts, documents,
signatures and requests from internal clients.
It claims to have more than 1,800 customers,
with over 20,000 lawyers using ProJuris every
Another is Docket. Founded in 2016, the selfproclaimed
'document shop' has developed a
platform on which clients - for example, the
legal departments of large companies - can
manage documentation, allowing faster access
to documents, reduced friction with public
services and AI-enabled data analysis. Last
year, the company participated in Google's
Launchpad accelerator programme.
'The size of this market is huge. We used to
operate without any technology and now
we are looking for how technology could
solve a lot of problems, through automation or
AI and, with this market size, with this very
complex system and with technology, I think we have
the recipe to create a lot of start-ups in this market,'
'In Brazil, this year  was the year of
fintechs. But I think the legal techs in the next
two or three years will be the hype of the year,
because we have a lot of solutions emerging.
And we have huge potential, because we have
opportunities with sectors inside of the legal
INNOVATION BY ASSOCIATION
Someone who certainly believes in the future of
legal techs is Bruno Feigelson. A lawyer himself,
he founded his own legal tech company in 2016,
Sem Processo, which aims to connect lawyers
and companies in order to resolve and settle
the vast numbers of matters that end up before
Brazil's legal system more easily.
But he didn't stop there. The following year,
together with legal departments and law firms,
Feigelson - who also runs a law firm, a law
school and a legal tech accelerator - created the
Brazilian Association of Lawtechs and legalTechs,
known as AB2L.
'At that moment, we had some tech companies
in Brazil, but we didn't have the
main legal tech or law tech - it was
something like a desert in Brazil
for technology. We started the
association with just two companies
and, nowadays, we have 200 legal
techs in Brazil in the association,' he
Feigelson had observed an increasing
interest in technology to assist in
legal processes such as contract automation
and litigation management and analysis, and
he predicted this would evolve beyond the
implementation of tech solutions developed
in-house to the use of external platforms and
processes that would become available on the
market. And he is confident that he was right.
'We have a lot of potential. It's very interesting
because the ' change is not just the
technology - it's the change of mindset,' he
'Lawyers are now looking to find a newer
way and a better way to change the field. It's
interesting to compare AB2L two years ago
and now. Now we have solutions for tax, for
compliance and for data protection.'
One particular area of innovation observed by
Feigelson is visual law - using design to illustrate
The lawsuit in Brazil is one in which
the state of Brazil is suing certain companies.
This lawsuit could be worth billions and billions
of dollars. We are drawing all the petitions in
order to help the judge show the court what has
happened. Three years ago it was impossible to
imagine that you would be in a meeting with a
lawyer and a designer to improve understanding
for the client,' he says.
But, he concedes, this has not yet translated to
a huge number of legal tech companies in Brazil
Roso believes that coming up with an idea for a
start-up in the legal sector, particularly in Brazil,
necessitates first-hand experience of the market.
Docket itself was created following the challenges
experienced by one of the co-founders while
working for a real estate company.
'You need to study a lot to create a start-up to
solve these processes. It's different to thinking
"Oh, let's think of something to create." I think
for legal tech you need to experience this pain,
you must understand how to solve it. It's not
too simple because we don't have a standard
here,' he says.
Put simply, however, Brazil is not the most
conducive environment in which to open up
a business. Placed 138th out of 190 countries
included in the World Bank's Doing Business 2020
rankings for starting a business, the country
scored 124th for ease of doing business overall
(figures taken from World Bank. 2020. Doing
Business 2020. Washington, DC: World Bank.
DOI:10.1596/978-1-4648-1440-2. License: Creative
Commons Attribution CC BY 3.0 IGO).
'The complexity to open a business, get clients,
handle these physical problems that we have to
understand our taxes, to pay our taxes - I think
it's not so good yet,' says Roso.
For the legal sector, there are specific problems,
and the very bureaucracy that has created a
huge potential market for legal technology
platforms also creates hurdles.
'We have the problem of dealing with hundreds
of different courts around the country, each
one with its own system. There are more than
100,000 open cases in the Brazilian legal system,
so in this decentralised and unstructured
scenario, most legal techs fail to obtain and use
public information,' says Fachini.
The Doing Business website identifies some
business reforms made by the governments in
recent years that have smoothed the way for
those looking to start a business. These include
speeding up business registration, lowering the
cost of the digital certificate, and establishing
online systems for company registration,
licensing and employment notifications for Rio
de Janeiro and São Paulo. The government also
launched an online portal for business licences in
Rio de Janeiro.
'I think this government, and other governments,
are concerned with being more friendly with
entrepreneurs. As a result, we have had laws
pass through our congress that make it easier to
be entrepreneurs,' says Roso.
'We are at the beginning of this agenda. It's a
long ride - we have a lot of things to do, but we
are starting, so this is something to celebrate: we
start this process here. I think the support from
the government is very important because they
could transform this whole scenario and bring
more investment to our country and generate
more jobs. Everyone has some kind of benefit
A NEW (AD)VENTURE
The biggest problem, according to Feigelson, is
a lack of investment relative to markets such as
the US or the UK.
However, the tide may be beginning to turn in
the venture capital stakes. In 2019, SoftBank
Group launched a $5bn technology innovation
fund focused on Latin America. In May 2019,
Crunchbase reported that venture funding in
Brazil reached $1.3bn in 2018, up from $859m
in 2017 and $279m in 2016, according to figures
taken from LAVCA, the Association for Private
Capital Investment in Latin America.
'[Venture capital funds] are more present in
Latam, I think, compared to three or four years
ago - when it was completely different,' says
Closer to home, in the legal sector,
encouragement for legal tech is not as evolved
as it could be, says Feigelson, whether through
direct investment or by launching incubator
and accelerator programmes. Early adopters
are often thin on the ground, and
although support is there in theory,
the money is not always where the
'The law firms in Brazil, they don't
invest a lot of money in law techs.
They don't have a lot of money,
because in Brazil we have a closed
system in law firms. It's impossible to
invite a partner that is not a lawyer to
introduce to this society,' he explains.
'They believe, but they don't believe in this
revolution. It's very common that I'm going to a
conference and talking about international big
law and the companies that they are creating.
But the Brazilian law firms, they are not doing
Adds Fachini: 'Sometimes, our Brazilian bar
association (called the OAB) puts some barriers
in the technology way, trying to keep the old
patterns instead of helping us to develop faster
to help even more people.'
Perhaps a cautious approach to investment
among incumbents is prudent, however. To
throw a potential spanner into the trend among
law firms in regions like the US and Europe to
launch innovation labs, Monteiro believes that
the benefits to incumbents of incubating and/or
accelerating start-ups are not always clear.
'It's not even a billion-dollar question but
a trillion-dollar question: to what extent
incumbents will ever be able to integrate
whatever those start-ups are doing,' he says.
'Imagine I'm a big company, let's say a bank,
and I start investing in fintechs - I have all those
fintechs in my lab. To what extent will I be able
to change the bank, or will I just be an investor
in those new things? It's not trivial, because the
nature of the change is so much more profound
than the previous technological changes.'
Monteiro is not speaking specifically about the
legal sector, of course, but of a general response
to possible technological disruption across the
'I think we have a tendency of thinking
that this idea of open innovation and accessing
business technologies is more about "How do
I connect with start-ups?" But actually, a lot of
my feedback about it is that it is not about the
connection itself, it's more about "How do you
bring those things home? How do you transform
But Feigelson has observed the tech revolution
(and, perhaps, cultural invasion) continuing
apace - across all sectors in Brazil, even legal.
And in-house teams, with their proximity to
trends across the corporate ecosystem, are wellplaced
'In Brazil, if you are a bank you are looking for
fintech, if you are a health company you are
looking for health tech - all these companies
are living a special moment. We have a big
movement in Brazil against wearing a tie,
nobody wants to wear ties, they want to be
modern, they want to be like Steve Jobs,' he
'The reconnection of the legal world with this
new reality, of the fourth industrial revolution,
it's easier for legal departments than the law
IN-HOUSE LEADING THE WAY
'[Incumbent legal service providers] are starting
to realise that technology is a friend which can
help them to be more effective and efficient in
their daily activities. In the beginning, there were
misunderstandings about how technology would
and could help, but now everyone is looking for
tools to help legal routine,' says Fachini.
But, in many cases, according to Feigelson,
customers are coming from the in-house sector, and
not external firms: 'They take the money that was
for the law firms and they put it into legal techs.'
At Docket, most clients are also tech-curious in-house
departments. Their concerns are practical rather
than innovation-related, in Roso's view.
'We have 130 people here, we have a huge team,
and we always talk with huge clients, so we need
to be prepared to absorb these huge clients.
I think their consideration, at the end of the
day, it's not about [whether we are] a start-up,
but if we will have the necessary structure to
handle them. I think, in most cases, they are
very optimistic about how technology could
transform the legal department and reduce
these operational jobs without any kind of value,'
The Brazilian general counsel GC spoke to as
part of the research for this report were bullish
about the potential of technology to improve
in-house life, and took a pragmatic approach to
the adoption of innovative tools - whether they
be those developed specifically for their own
departments, customised off-the-shelf software,
or services procured from third-party tech
'Legal tech is the future; it is only a matter of
time before they can prove what they are using
is consistent and sustainable. I think that there is
no way back - technology will only be more and
more relevant to the legal market,' says Rafael
Dantas, director of legal and compliance in Latin
America for General Mills.
For some, the challenges around technology
revolve not only around selecting system tools
likely to be effective, but identifying the best
method of procurement. General counsel must
find the right momentum and timing between
developing them internally (balanced with other
priorities within companies) and hiring thirdparty
developers. But, the need for appropriate
system tools is widely accepted.
IS DISRUPTION COMING?
Conditions are certainly favourable in Latin
America - and in Brazil specifically, says Monteiro.
'When you are a developing market, one
potential application of technology is offering
leapfrogging opportunities. Remember that in a
number of these markets they have nothing, and
if they adopt the most recent technology, they
will basically skip prior stages of technological
development. The most well-known case was in
Africa with M-Pesa in Kenya where, 10-15 years
ago, most people didn't have a bank account.
M-Pesa started offering mobile payments on very
simple phones. Many Kenyans don't have a formal
bank account and maybe they never will, because
a lot of people skipped and started having a
mobile wallet in their cell phones,' he says.
'There are a number of examples like this in Latin
America. If you want to extrapolate a little and
think about the legal sector, there are maybe
two points to consider: one, is to imagine that
some companies, and some of those start-ups,
will never engage with formal legal services as
we know them now - maybe they will skip that
and they will start engaging with new ways
of getting legal services; two, is the level of
complexity of the Brazilian legal system - it is
so complex, which means that you have a lot
of lawyers and that's why the legal tech sector
in Brazil is thriving - because people know that
there will be ways of disrupting that market and
offering many different things.'
Feigelson certainly knows, and perhaps his
enthusiasm - and that of the legal techs, like
Docket, which is an AB2L member - will continue
to be catching.
'We believe a lot that we have the numbers
and we have the anthropological conditions
to make the biggest evolution in technology in
Brazil. I work with researchers in Brazil, I work
with law techs from other countries: people
are coming to Brazil and trying to understand
what's happening here. I think we have a lot of