Killer Whale Strategies Invests in Cleary-Backed 10BE5

Killer Whale Strategies has announced that it has made a small investment in Cleary Gottlieb-backed capital markets startup, 10BE5. The company said that this stake, along with investments from several Angels, was part of a ‘pre-seed extension’.

The move coincides with the news Artificial Lawyer shared in March that the legal tech startup – which was backed by elite New York law firm, Cleary Gottlieb, last year – had recently formed a partnership with leading Swedish firm, Vinge – see article and interview.

Killer Whale is a consultancy created by Israel-based legal tech expert, Zach Abramowitz. He has also invested in LegalMation, the litigation startup, with more investments in other companies to be announced soon.

10BE5 co-founder, John Kwan, said: ‘We’re fortunate to have a waiting list of senior lawyers, legal tech gurus, and other professionals that learned about us through different channels, including as customers, and wanted to invest in 10BE5.

‘The announcement of our partnership with Vinge presented a natural point for us to bring some of them on board. This is consistent with our collaborative approach. Existing investors also responded enthusiastically, with a few investing significantly more than their proportional shareholdings required.’

All well and good, but what does 10BE5 do? Well, it’s a multifaceted tool, which has three main parts for now. This is how they describe what they offer: 

1. ‘N2N – N2N has undergone multiple iterations since its initial launch. Thanks to N2N being used by top capital markets practices across the globe, we have been able to incorporate valuable feedback that addresses specific requirements in different regions.  Take a couple of concrete examples: (1) feedback from lawyers in Asia at two Magic Circle firms led us to develop alternative cash flow discussion structures required in that region and (2) feedback by a top 50 Am Law firm that used N2N to prepare a Form 10-Q for a US issuer led us to develop additional configurations suitable for ongoing reporting.
2. Takedown – This product enables the rapid generation of transaction documents for shelf take-downs (offering of securities from a shelf registration statement).  We are trialling this with Cleary. 
3. Risk Factors – Risk Factors will provide a one-stop-shop solution that addresses lawyer’s research, drafting, and knowledge management needs in relation to risk factors.  This uses a lot of NLP in text parsing, generation, classification, and summarisation.’

Commenting on the deal, Abramowitz said: ‘Investing in legal tech startups is more than a hobby for us. Having skin in the game is core to Killer Whale Strategies. Investing improves our research which improves our content which in turn improves our deal flow. I hope that, as someone who lives and breathes legal tech, that my investments send a signal to the rest of the industry.

‘[So], today I’m excited to announce my investment in 10BE5, a London based legal tech company founded by Cleary attorneys John Kwan and Mohamed Taha.

‘Any attorney who has ever worked in capital markets knows the amount of repetitive, mind numbing work that goes into drafting disclosures whether the financial trends in the management discussion and analysis, or the circle-up process.

‘I have long suspected that someone would design a product for capital markets attorneys. But, I also knew the amount of legal expertise required to build this product, so it had to be the right founders. I am betting on John and Mohamed.’

Although the sum invested by Killer Whale is small, around five figures, it’s another sign of the continued interest in legal tech startups at an early stage. It also shows that while some areas have become saturated with a range of companies of differing levels of capability, there are still new niches opening up.

And as Abramowitz noted, capital markets is an area that remains underserved by legal tech – suggesting that we may see more companies covering this area in the future as founders look to launch into market segments that are not already covered.