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Consultants have pointed to a wide set of potential reasons for a consolidating market. E-discovery vendors are increasingly charged with transnational projects that can be difficult for small shops to manage, and they now face new efficiency and data compliance scrutiny from corporate legal department customers.
“To answer those questions effectively required an outlay of capital,” Consilio CEO Andrew Macdonald previously told LTN.
Adding another wrinkle to the consolidation forces in e-discovery is the fact that technology startups, who often rely on the notion that better technology brings with it the potential for market disruption, have struggled to get potentially better technology noticed in an already crowded e-discovery field. Macdonald noted that while “there’s been a lot of really cool technology,” many smaller companies struggle to scale that technology out.
E-discovery companies likely to come out on top, Macdonald said, “may not be the best software that is going to emerge, but it’s the best funded, has the best capital structure and has the best discipline about how it’s going to grow.”
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