Scott Mozarsky Scott Mozarsky. Courtesy photo

Scott Mozarsky, who most recently led litigation funder Vannin Capital's North American operations, has joined midmarket investment bank JEGI with a self-described mission to help shape the burgeoning legal technology industry.

After a little over a year at Vannin, which recently abandoned its presence in the U.S. and Germany, Mozarsky started at JEGI as a managing director Monday. Formerly the president of Bloomberg Law and a top executive and general counsel for business-to-business publisher UBM, Mozarsky likens the ongoing evolution of the legal tech market to an earlier transition in the world of B2B publishing as a result of the digital revolution.

"I see a lot of similar patterns with respect to where the legal market is right now," he said.

With a focus on media and information services, as well as software and tech-enabled services, JEGI had a hand in the reorganization of the B2B world. New York-based Mozarsky thinks he can help the company do the same thing in legal tech, which cracked the $1 billion threshold for investment in 2018 and has already passed $1.2 billion this year.

"Look at the capital that's being infused in legal tech," he said. "Somebody has to help the market function in a more logical way to help it evolve."

The legal tech marketplace still has significant catching up to do to even come close to financial technology, or fintech, with a global market estimated at $111.8 billion. That's both because finance has far more economic heft than the legal industry, and because lawyers have been slower to embrace technology.

"People were quick to adopt using and leveraging data to make their decisions," Mozarsky said of finance. "On the legal buy side and sell side"—law firms and in-house law departments— "we're not as quick to do that. For a long time, it was more art than science: selecting counsel, making the decision to settle or move forward, to negotiate a transaction or not. More and more key players, are now more accustomed to using data and technology to do a better job."

Mozarsky anticipates the Big Four accounting firms becoming increasingly acquisitive of legal tech players. While these entities have dramatically invested in legal services globally, regulatory obstacles block them from directly competing with law firms in the U.S. Rolling out tech solutions allows for an alternate point of entry. In recent years, for example, EY has purchased Pangea3 from Thomson Reuters as well as Riverview Law.

"It's a backdoor way to get into and serve the U.S. market," Mozarsky said.

He also expects the market for legal tech to remain brisk even in the event of an economic downturn.

"It's hard for firms and in-house groups who are adopting new technologies to suddenly step back and say they're not going to invest in this stuff," he said.

Mozarsky added that the efficiency gains may prove especially valuable in a recession, singling out AI tools LegalMation and Neota Logic. 

"I don't think legal tech is about robots killing off the lawyers," he said. "But law firms can work more efficiently and focus on the more meaningful higher-end stuff."