Smart Contract Photo: Shutterstock

 

On-demand legal services company LegalZoom.com, Inc. has announced a partnership with contracting technology provider Clause Inc. by which it will offer its customers access to Clause's smart contract services. The move represents the first salvo in what is shaping up to be a race to bring smart contracts—which automatically execute their terms on the blockchain without need of intermediaries—to the legal service market.

With the new partnership, LegalZoom will allow its users to edit and sign contracts through the Clause platform, or augment LegalZoom contracts with Clause's “Smart Clauses” feature, so that such contracts can execute automatically on any blockchain.

The functionality to use Clause features within LegalZoom and vice versa, will be released as a public beta on Sept. 26.

In a statement announcing the partnership, Peter Hunn, founder of Clause, said that Clause “will augment LegalZoom's existing model with functionality that enables LegalZoom users to connect their existing business systems to contracts that are automatically executed when a milestone is achieved or a task completed.”

In the same statement, Vanessa Butnick Davis, vice president and legal managing product counsel of LegalZoom, added that the partnership “makes cutting-edge technology available to and usable by consumers and small businesses in ways previously unimaginable.”

The announcement comes just days after LegalZoom competitor Rocket Lawyer Inc. publicly disclosed it is working with blockchain developer ConsenSys to develop a smart contract service called Rocket Wallet.

However, in an email, Hunn said that the new partnership was “completely unrelated” to Rocket Lawyer's move. “This was agreed months ago, the tech has been built out in the interim.”

He added that LegalZoom and Clause agreed to work together for two reasons: “to bring Clause technology to a wider audience and for LegalZoom to offer the latest contracting technology. It's a win-win for both.”

LegalZoom's partnership with Clause comes at a time of much growth and change for the company. Like others in the on-demand legal services space, LegalZoom has looked to put its past battles with state bar associations behind it and focus on expanding its services and customer base.

For example, in June, the company partnered with nonprofit patient advocacy organization Patients Rising, which saw it expand and offer its employee benefit product for free to the organization's members.

In July, LegalZoom also announced it had closed on a $500 million investment round led by Francisco Partners and GPI Capital—one of the largest single legal technology investments to date.