In a story for Legaltech News, Gabrielle Orum Hernández covers Allegory's latest funding round and why Founder and CEO Alma Asay chose to seek investment from within the legal community instead of taking the venture capital route pursued by many startups.
Asay wasn't trying to blaze a new trial, but during her time in Silicon Valley, she came to realize that typical venture capital models are often not compatible with legal technology startups (one of 6 reasons legal technology companies should not take VC money). In her own words:
"They want you to go out and give things away for free and get all the users in the world, and then figure out how to monetize it. That doesn't work in legal. Lawyers don't really value something they don't pay for."
Struggling to scale on cash alone, Asay began reaching out to connections from her previous career in litigation.
"You are surrounded as a lawyer by lots of people who have money. It's just a matter of how to broach the conversation. If they believe in you, they're not going to balk at investing $10,000 or $20,000."
Asay's connections in the legal tech space also bore fruit, and from this pool of investors, she gained an invaluable resource: experience and knowledge of the market.
"It's really cool not just to have these people invest, but to have them as sounding boards and resources."