Legal Nodes: A personal lawyer for startups focused on the global market

Legal Nodes cover for Ucluster

Margarita Sivakova, the founder of the Ukrainian startup Legal Nodes, aims to create a single place for solving legal issues of startups and other IT businesses. “My co-founders and I decided not to take the easy route and open a regular law firm. We wanted to try something new and create an online marketplace for legal services. The process of launching our own startup was very motivating,” says the founder. “First, there was a great startup idea, and then there was a crazy desire to do something that would radically change people's lives.” On the Legal Nodes platform, the client is assigned a personal lawyer picked from an international network of proven attorneys who best understand the needs of a particular business.

Legal Nodes logo

Co-founders: Margarita Sivakova, Nestor Dubnevych, Max Maliuk

Location: Ukraine (Kyiv) and the UK

Founded: 2018

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The idea to launch a startup came to Margarita and her co-founder, Nestor when they worked together in a business law firm focusing on fintech startups. Their clients had to spend a lot of time on legal issues, finding the appropriate attorneys, and going through the fundraising process. Traditional lawyers could not effectively provide legal assistance because they did not understand the technology business and its needs.

For a while, Margarita and Nestor were intermediaries between startups and lawyers in different countries, translating from tech-speak to legalese. One day it occurred to them to create a platform that would put them out of this job and do the matching between startups and lawyers automatically. Together with a third co-founder, Maxim, who is now the CTO, they founded Legal Nodes in late 2018.

A personal lawyer for a startup

Legal Nodes wants to help startups and scale-ups grow without friction and accomplish all legal processes as simple and fast as possible. This goal is achieved by matching companies with the right lawyers at a fixed subscription fee. Once clients are matched with their lawyers, Legal Nodes becomes the communication and workflow platform for addressing all legal needs.

The company currently offers three types of services — Virtual Lawyer by Subscription, Data Protection Officer by Subscription, and other packages of legal services at a fixed price.

In the first service, the client is matched with a lawyer who understands their ​business. The Legal Nodes platform provides a place to discuss and track the progress of legal tasks, manage documents and obtain instant answers on a confidential personal dashboard. They can also add new service subscriptions or get advice from a lawyer of another specialization on a specific issue, saving them time and money. And because their lawyers are supporting several companies, they work efficiently and at a lower cost.

Legal Nodes.
Legal Nodes Team.

When a customer needs a Data Protection Officer (DPO), Legal Nodes assigns a verified DPO to the company, who is then responsible for helping to protect personal information. Due to the GDPR legislation in the EU and similar laws in other countries, most startups working with customer data are required to have a DPO. This is especially true for all startups that store and process medical and financial data, work with large amounts of information about their customers, and use AI technology. And the salaries of DPOs in Europe can be pretty substantial. Legal Nodes allows startups to spend five times less on DPO services compared to hiring a full-time employee.

Legal Nodes also offers legal services outside of the first two subscriptions and for a fixed fee. They include contract and document creation services for websites and day-to-day operations and are already used by dozens of startups. A significant advantage of Legal Nodes is that pricing is transparent and legal costs are predictable.

The UK market for legal services

The Legal Nodes team is now adapting the platform to the UK legal market and recruiting local lawyers. They are already working with local marketing, positioning, and copywriting professionals and have launched an advertising campaign. In the United Kingdom, there is significant demand from startups and business owners for a solution offered by Legal Nodes, as legal innovations have not yet reached this market segment.

99% of the companies in the UK are small and medium-sized businesses, says Margarita. During the COVID-19 pandemic, their number is only going to increase. For example, many employees of large companies are quitting and starting new career paths. In addition to the local demand for legal services,  small companies outside the UK are trying to enter the UK market and need help with legal tasks. For example, when someone fundraises in the UK, they need to be aware of the significant legal risks during this process. Some of the first Legal Nodes customers were Ukrainian startup founders who opened their companies in the UK and Europe.

Comparing Ukrainian and United Kingdom founders, Sivakova explains that the UK startup founders are more aware of their legal responsibilities. They tend to turn to lawyers in the early stages of their startups. In Ukraine, there is much less awareness of potential legal issues, and founders delay their outreach to attorneys until much later. More legal problems are possible in the long run.

The long-term game and acceleration at Techstars

“Every day, there is something new we have to find a solution for. This is a conservative market, and people are not used to high-tech innovation,” says Margarita. “Jurisprudence is a complex domain, and it will take some time to change the traditional thinking and processes. I see it as a personal challenge and opportunity to significantly alter the legal field, making it more innovative and modern. It fascinates me like nothing else.”

To execute their plans to enter the UK market, Legal Nodes raised a pre-seed round of $300,000. The investment round was led by the angel syndicate  LIFT99 and included several well-known investors including Ragnar Sass, Artis Kehris, Martin Henk and Maarika Truu. Other prominent investors who joined the round included Hype Ventures of Mathias Eklöf, who previously invested in the startup as an angel, as well as the British TaxScouts founder Mart Abramov and former Fuzu COO and growth chief Edward Vaisberg. Inspirium Laboratories, a fund created by partners from Sigma Software, also participated, as did the founder of Datrics.

“Startup founders live the most exciting life.”

Margarita Sivakova, founder of Legal Nodes.

Currently, the three Legal Nodes founders are participating in the Techstars acceleration program in London. Their time is filled with meetings with potential investors and startup mentors, advisors, people from the legal industry, and top professionals working at Uber and Google.   These experiences can't be had anywhere else, especially in such a short time,” says Sivakova. “If a startup, especially a LegalTech or FinTech startup, wants to enter the UK market, going through the Techstars London program makes a lot of sense because the city is still the financial center of Europe.”

The startup actively interviews clients to improve its product offering, as each country has its specific legal issues and challenges. Being part of the Techstars program at the heart of a large startup community, the team has the opportunity to interact with startups that may become their customers in the future. Their peers help them with feedback on what can be improved, and program mentors help with other issues faced by Legal Nodes.

The core R&D team of Legal Nodes is based in Ukraine, and founders plan to continue with this format in the future. “There are very good technical professionals in Ukraine, and we want to continue working with them,” Margarita shares with us as we get to the end of the conversation. As our recent analysis of Ukrainian startup founders showed, many Ukrainian founders have the same attitude. 100% of the respondents had the core development team based in Ukraine and did not plan to change it. Regardless of the place of registration, as long as startups maintain R&D centers in Ukraine, high value-add jobs will remain in Ukraine, strengthen the ecosystem and enable future startups.