After Deloitte joined the legal tech incubator scene earlier this month, the space is quickly crowding with potential opportunities to stoke and scale legal innovation. Meanwhile, more incubators means a wider assortment for startups to pick from, and past participants say new entrants into the legal tech incubator arena will have to meet high expectations.

Indeed, legal tech startups that have taken part in incubators and accelerators told Legaltech News their experiences were worthwhile and beneficial. Though some critics warn that law firms and Big Four legal tech incubators don't truly assist companies in reaching peak profit potential, past legal tech incubator participants say they gained substantial industry insights and assistance from their program. But it's an experience those participating in general tech incubators don't all share.

Haley Altman, Litera Microsystems' general manager of transaction management, understands the potential horrors faced by startups joining an incubator. When she was an attorney at Ice Miller, Altman counseled tech startups that were selected to participate in incubators. Some clients said incubators did not clearly state the goals of how they will advance a company. In turn, there wasn't a clear value that came out of it, she said.

In contrast, Altman said when she was navigating her own startup Doxly through the incubator arena, she had a great experience leveraging the business expertise of venture studio High Alpha and the industry insights of Dentons' Nextlaw Labs.

"There are a lot of incubators and they can all help you, but some of them aren't where you want them to be," Altman said. "But I was fortunate."

She added that "when you are looking for investors, you want to look at people who can help you in different ways. In High Alpha, we got a lot of expertise in building a company," Altman said. Dentons, meanwhile, provided subject matter expertise about law firms, including how to sell to law firms and lawyer feedback.

Altman's sentiments were shared by other legal tech startups Legaltech News contacted for this article. All noted that while the incubators take them away from directly selling or developing their product or service, the business advice and client connections gained from the program makes it worthwhile.

"When I got in, it was the right thing for my company, it was 100% worth it," said Rachel Shapiro. The founder and president of Medilenz, Shapiro's company participated in LexisNexis's accelerator in 2017. "The time I didn't spend cold calling, marketing [in the incubator] got me back a thousand times more. It was invaluable."

Shapiro noted such accelerators and incubators are competitive and selective, but ultimately the company's success doesn't hinge on participation.

"There are companies that fail anyway so it's hard to say they shouldn't have failed because of the incubator. … It's not like you just sign up. You have to apply, be vetted and state your reason for wanting to be in it, and they reach out to a lot of companies," she explained.

But David Holme, the CEO and co-founder of alternative legal service provider Exigent who recently started an evergreen fund for legal tech, said startups won't grow substantially with these Big Four and Big Law incubators.

"The law firms have no investment experience at all. They definitely haven't demonstrated being more efficient, there's no real drive for efficiencies, technology is one of those things you want to put on brochures and banners," Holmes said. He added that the Big Four "are less legacy than law firms. They are probably a step up from firms, but they too want to use [the startups]. They aren't investors."

Investments in startups are a small drop in the bucket for the Big Four, Holme explained. "For the venture capitalists, their very livelihood would depend on the return. For Deloitte: Our biscuit bill is half a million. We will put it into legal tech and tell them we are a venture fund, and will use their software and we will most certainly profit off of you before you do."

Still, for many legal tech startups, incubators can represent a chance for valuable feedback and face time with potential clients and those in the field.

"There's no quick wins in this world, you have to find the right people to work with to get where you want to be," Altman said. "Be thoughtful about what you want to get out of these organizations."