A Conversation With Curt Sigfstead (Video)

Mark Longo: Hello to all of our viewers. My name is Mark Longo. I'm the Co-Chair of the Emerging and High Growth Companies group at Osler, Hoskin & Harcourt, and I'm the Managing Partner of the Vancouver office of Osler.

I'm very pleased to welcome Curt Sigfstead, Chief Financial Officer of Clio. Prior to joining Clio, Curt was the head of West Coast Technology Investment Banking at JP Morgan, based in San Francisco. He has advised on some of the tech sector's largest M&A deals and has raised billions of dollars across public and private debt and equity markets. With over two decades of technology financing experience, Curt has held senior finance leadership roles at several companies, including Clearco. He sits on multiple nonprofit boards, including C100, which supports Canadian technology entrepreneurs through investment and mentorship. He is also a member of several leadership and investment communities, such as Bain Capital Ventures' CFO Advisory Board, The Circle by Founders Circle Capital and the Brown University Angel Group. As Cleo's CFO, Curt oversees all finance functions, including accounting, treasury, financial planning and analysis, legal and corporate development. His track record includes major financing events such as mergers and acquisitions, IPOs and private and public equity and debt financings.

Great to chat with you today, Curt.

Curt Sigfstead: Great to be here, Mark, and thanks for all the work that Osler does for us all the time, and particularly recently with the Series F, which I know we're going to get into.

Can you give an overview of Clio?

Mark Longo: Absolutely a pleasure. To kick it off, can you give our audience a brief overview of Clio?

Curt Sigfstead: Absolutely. So Clio fundamentally is the world's leading cloud-based legal tech platform. And why we define it as a platform is because really, we're providing the operating system for the law firm, which includes comprehensive practice management, CRM, legal content solutions and a payments, billing and invoicing platform. But we're more than that in the sense that we also, really, our mission here at Clio is to transform the legal experience for all. And we do that by, obviously, our technology platform, but we're also very much an industry leader with Clio Con and bringing together the legal professionals from around the world, across the United States, to talk about all the pressing issues in terms of operating a law firm and ensuring that they're ahead of the trends in terms of operating their business.

We're committed to that education and we're committed to that aspect of improving the experience for the entire legal community. Fundamentally, what Clio does with its platform is it streamlines the operations and improves client communications and accelerates revenue for law firms, which is obviously a very compelling value proposition. And we've done that obviously through our own platform, as I just talked about. But we've also built a very robust ecosystem of application integration partners who help with their various integrations to provide very tailored and distinct solutions for our law firm customers. So hopefully that gives you a good overview of what we do here out of Clio. We do that obviously from our head office here in Burnaby, British Columbia, and we have approximately 1,400 employees, mostly in Canada, but we've also got a good bunch in the U.S. and also in Europe. And I think to give you a sense of scale and size, we're roughly 150,000-plus legal professionals are now on the Clio platform. So it's been 17 years in the making, but as we always say here at Cleo, we're just getting started and we really focus on our customers. And that's been really, I think, the strength of Jack's mission is really continuing for us to focus on helping lawyers achieve their goals, and that's really helped us achieve our goals. So I'll turn it back to you. Hopefully that gives you a good sense of who we are and what we're trying to do and what the basic sort of pieces of the technology platform are.

Describe the catalyst behind the Series F round?

Mark Longo: A very impressive track record indeed, and one that led to your Series F financing. To segue into that financing, in July of 2024, Clioo announced the closing of a US$900-million Series F financing round. The round was led by New Enterprise Associates. You had a valuation of US$3 billion in that round. To give you a few of the other metrics, this deal represented the largest venture round in Canadian history. It was the largest round in legal cloud software history, and it was a top-five vertical SaaS financing in 2024 globally. Osler was very proud to support you in that transaction as your counsel. So Curt, can you describe the catalyst behind the Series F round?

Curt Sigfstead: Yeah, absolutely. And obviously we're very fortunate to work with you and your team, Mark, on that transaction and obviously benefited greatly as we had the outcome that we did. So the initial goal for the Series F was really liquidity for some of our early institutional investors. And the challenge that we face now in the markets is the fact that oftentimes fund life isn't necessarily matched with company life. And so we're seeing situations where investors are looking for an exit based on the fund life. They love the company, they wish they didn't really have to do it, but in this case, we had had a number of early-stage investors who had really supported the company in sort of the earliest periods of Clio's growth and we wanted to reward that. And so that was clearly a key catalyst.

Second catalyst was really recognizing an opportunity for us to bring on a new set of investors, investors that would help us at our stage and scale to take us to the next level.

And the third catalyst was the opportunity for us to reward employees at Clio who had clearly dedicated the hours and the time and effort for us to achieve what we had achieved to date, to enable them to realize the benefit and value of the equity that they had earned. So those were really the three catalysts in terms of what got the ball rolling, and what we really wanted to do as a goal of the financing was establish a fair valuation for our equity. We wanted the market to understand our leadership and what we had developed at Clio from a customer and product standpoint, and give us the fuel and the expertise to, as I mentioned, take us to the next level, but also for us to do acquisitions like the ShareDo deal that we recently executed, obviously with the help of Osler as well.

So those were the main catalysts, and I can get into some of the dynamics and the process, but at a very high level, that's where we entered the process and we certainly didn't start with a 900 number. I don't think any CFO or board would believe me if I said, "Oh, well absolutely, We sort of kicked it off with 900 in our minds." It started with a much smaller number and grew through the process, which is sort of the place you want to be, but it surprised even us as we went through it. So hopefully that gives you some scope and perspective and sort of an understanding of the catalysts of why we did what we wanted to do there.

Walk us through the process of securing term sheets

Mark Longo: Absolutely. Well, let's unpack the deal a little bit more. So walk us through the process of securing term sheets, selecting NEA as the lead investor and ultimately assembling the world-class syndicate investors that you did.

Curt Sigfstead: Yeah, so we started 18 months in advance. You never sort of start— cold start and capital raise as sort of a non-starter, if you will. So there was a lot of educating the market, attending investor conferences, really giving Jack an opportunity to talk about the Clio story and where things had evolved and changed, obviously since the last time we raised capital in our Series F. And so we had a good understanding and a good sort of set of dialogues underway with various investors before we kicked off the formal process. But we effectively ran a very rigorous, competitive process with top-tier investors.

And we did that through continuing to focus on transparency, access to information, detailed conversations about our business. And that's where the investors really dug into the diligence, our financial models, our technology progress, our go-to-market areas of focus. And what we made sure of is that we gave that access to all parties involved. We ran a very transparent process, we kept to our dates and we updated the investors as we went through it in terms of new insights or new perspectives on the business. The one insight I would say is we really mapped out how this would play out over the six to nine months and being sure that what we started the process with, we could deliver at the end, because investors would have effectively almost three quarters of data that they would have in order to make their decision about Clio. We focused on building relationships during that process, building trust, understanding who really understood our business, who could take us to the next level.

And then that really led to NEA. And first of all, they completely distinguished themselves relative to the field in terms of their understanding of SaaS, their long-term perspective, strategic alignment, their advisory network, prior investments that they had made and the success that they had had. And so they were a natural fit. And then I think the personalities around the table really jelled with Clio's approach and vision and the opportunities that we had ahead of us. And then we're super proud of the syndicate that came in with NEA, the likes of Goldman Sachs, Sixth Street, CapitalG. We had folks from Tidemark as well come in and there was a significant commitment of capital from those partners, and each one of them brought another set of experiences and strengths that, frankly, we need to take Clio to the next level. So really no different than the NEA process in terms of it was about building relationships and trust and then the various different areas of expertise that those parties could bring to the Clio story.

Can you talk about what led to that optionality and what is a true auction process?

Mark Longo: Excellent. You ended up securing around 20 term sheets, which is almost unheard of, particularly in this market environment. Can you talk about some of the tactics that led to that level of optionality and really a true auction process?

Curt Sigfstead: Yeah. Well, I hate to sound boring and maybe traditional on this front, but it came from incredible amount of meticulous preparation. A lot obviously we did with you, with Mark and your team, but with our advisors at William Blair, and also internally as a Clio team, just to make sure that what we were going to go to market with we could execute against, and that we were being consistent and, frankly, very transparent. Everything we talked about as part of the fundraising process was consistent, or we had clear explanations as to why it differed or was consistent with our past performance, and why we believed we could achieve the numbers that we were talking about. I am a big believer, and I know Jack is too, in trust; you've got to use— the process is about raising capital and it's about bringing on new investors, but it's also about building trust not only with your new investors, but with the marketplace. I sort of look at this as a huge marketing opportunity for us as much as it is a capital raising process, because your point around 20 competing term sheets, you're only going to pick one. So you want all of those other 19 parties to be talking about the deal they missed and what a great opportunity Clio represents and talking highly of the management team and otherwise. So we sort of took that approach and really embedded it in our process.

We obviously just like, again, it's boring and traditional. We had a detailed data room, our financial model, all the diligence items that we built with your help, Mark and the team, and that just meant that there was just no— we could move things quickly. Folks could see that we were prepared, we had anticipated their questions. And so that, again, built trust and the momentum in the process. So we were able to build a competitive process that leveraged the strong network of investors we had and created a sense of urgency, and that drove us to be able to land with NEA and the valuation that we achieved.

And I think one of the big questions going into it was how to talk about the market opportunity and the long-term vision. And the great thing about having Jack at the helm as our founder and CEO is that he's got that just intrinsically and authentically nailed. And his ability to connect on that front, I think, was an absolutely critical differentiator in our outcomes. So hopefully that gives you a sense of how we went about this process with 20 term sheets and sort of how we were able to get the outcome that we ultimately ended up with.

Mark Longo: It really was an incredibly meticulous and well-planned process, even to the point of us drafting collectively, drafting the term sheet, drafting the definitive agreements, presenting it to all of the prospective investors so that there really was an apples-to-apples comparison in what came back. Not just valuation, but deal terms.

Curt Sigfstead: Yes, yes. Yeah, that was a lot of work. I think we probably — collectively, the Clio and Osler and our partners at Wilson — probably spent, what, probably six weeks nailing that process from the start to actually signing the definitive agreements, in terms of aligning those terms, understanding how we were going to get all the investors comfortable because of the amount of capital they were committing behind the term sheet that NEA had presented. So yeah, just a tremendous amount of work balancing all of that while investors were asking for more allocation, and us as a team collectively going back to ourselves and some of our existing investors and thinking through, well, "Was there more shares to sell or more capital that we wanted to raise?" And so there was just a very fast turnaround times on a lot of this to be able to say definitively yes or no, we could increase the allocation to these syndicate members in the deal.

Why should management teams and board members be considering a secondary?

Mark Longo: Exactly. And the reality is this round was mostly secondary, where you had existing shareholders, investors from prior rounds, stock option holders, selling shares to these incoming investors. Just generally for our audience, why should management teams and board members be considering a secondary, from a liquidity perspective and from a recapitalization perspective?

Curt Sigfstead: Well, I think secondary financings are a way to bring clarity to the mission. And what I mean by that is I go back to my earlier statement about the misalignment that can occur between company goals and timelines and investor goals and timelines. And when I say investors, I just mean by the fact that the industry just evolves around seven- or 10-year fund lives. It's not anything that they're doing that is unnatural for them. And so, it really does align stakeholder interests and creates liquidity for investors who frankly were focused at Clio at a certain point in time and now we've sort of grown beyond their area of focus and they can realize the liquidity. I think too, it's great for employees and early investors just to be able to realize the returns based on the risk that they took in terms of investing employee their time and effort, but also investors early in Clio's lifecycle.

It brings a lot more stability to the cap table just by virtue of what I've talked about. And it allows us to retain the best talent because what we can do is highlight to prospective employees that you're not just getting options in a company that hasn't seen the realization of value over time, which is often something that I know a lot of folks in our ecosystem, when they're competing with employees who are contemplating public company offers, trying to balance that option illiquidity, versus RSU liquidity or shares, is tough. So I, and I think the dynamic that's changed here for all of us across the board is that there's just so much private capital available that secondary financings, once viewed, I think, as a bit sort of transactions that took place a bit in the shadows, are now, it's just a huge opportunity and investors have done really well by it as well. So I think it's here, this huge pool of capital and there's tons of benefits in the right situations for companies to execute a secondary.

Mark Longo: Makes perfect sense. Yeah, there's so much dry powder out there in growth equity and private equity now.

Curt Sigfstead: Yeah, and we saw that in spades during the process.

How does this acquisition align with your broader growth strategy?

Mark Longo: Switching gears a little bit, you briefly mentioned ShareDo. You've recently acquired ShareDo, which is a U.K.-based large law firm software provider. So tell us a little bit more about this acquisition. How does this acquisition align with your broader growth strategy?

Curt Sigfstead: Yeah, it's a very interesting transaction for us. So I think there's a couple of areas of where ShareDo really punctuates Clio's opportunity. The first is, it's a group, it's a significant team of technologists, developers, go-to-market individuals focused on legal tech, and for us, that's invaluable. Two is it gives us an incredible expanded presence in the U.K. and in Europe, where we already have a significant employee base in Dublin. So having that additional presence, additional customers, is huge. But three, probably the most important, is it strengthens our position as the leading end-to-end cloud technology provider globally. And what I mean by that is ShareDo provides a case management platform that large law firms utilize. And when I say large law firms, I mean the world's top hundred law firms, and they've got a proven track record of building relationships with those firms, selling platforms, supporting those platforms with the world's most demanding customers. And so, at the end of the day, this is about international expansion, product expansion, customer expansion, and gives us, as a result, a tremendous entrée to the large law firm market opportunity, where Clio has traditionally been focused on the mid- and small-size law firms. And for us, we think that that, from a TAM (Total Addressable Market) perspective, could be as large as our current market. And so we're so excited about the team, the technology they've built, and the market opportunity that is ahead of us there.

Mark Longo: Really opens up your addressable market.

Curt Sigfstead: Yes.

Mark Longo: Well done.

Curt Sigfstead: Yeah, thank you.

How do you see the legal industry evolving over the next couple years?

Mark Longo: Speaking of legal tech, legal tech is very hot right now. What trends do you see driving that momentum? How do you see the legal industry evolving from a tech perspective over the next couple years?

Curt Sigfstead: Yeah, so a number, I think, of observations on this front. We're definitely seeing an increasing adoption of cloud-based technologies, I think at all sizes of law firms for different reasons, but just by virtue of the fact that cloud-based solutions deliver exceptional functionality with incredible flexibility on the part of the law firm. And they also, importantly, sort of trend number two, they give you the ability to leverage AI, and AI and automation are transforming legal workflows and improving efficiency, which is critical for law firms of all sizes. Third, law firms of all sizes are really demanding data-driven insights in terms of how their cases are progressing, how their teams are being deployed, how they can leverage electronic payments to be paid faster.

Everyone's looking at legal much less as sort of a partnership, and transferring it, and I think looking increasingly as a business and sort of needing those tools to understand how the business is performing. And I think also, importantly — I mean this isn't just about the lawyers or the attorneys themselves —this is about providing better customer service and support as well, and giving customers a better experience. As competitive as the law industry is, I think that's becoming increasingly an area of focus. And so we're seeing the development or the expansion of platforms because, depending on the area of the market, the larger end of the market, they're looking for best-of-breed solutions and the ability to deliver on exceptional legal outcomes. And at the smaller end of the market, more integrated platforms, one-stop shop. And our goal here at Clio is to be able to deliver on both fronts, as you can tell by ShareDo, and also by our core platform that we went to market with the Series F.

What advice do you have for management teams in this current climate?

Mark Longo: Switching gears one more time. Considering today's economic and geopolitical climate, including the Trump administration's trade policies, how do you see these factors impacting business leaders this year? What advice do you have for management teams in this current climate? And we're filming here at the end of March 2025, so, ever evolving.

Curt Sigfstead: Yeah, this will be out of date in approximately 10 minutes. Really, my number one message, and we emphasize this every day here at Clio, is we can only control what we can control. And that is the critical levers within our business, which is how we operate and how we can continuously communicate amongst ourselves about changes we need to make in our business in order to ensure that the decisions we need to make are within our control. And what I mean by that is that we don't have to put ourselves in a period of incredible uncertainty at the beck and call of the markets or at the mercy of the markets, that we can decide when we want to go to market and/or raise capital in order to satisfy our strategic needs. So like we did last year, we went to market when it was best for Clio.

And as we sort of go through this, my advice to financial leaders or business leaders at this point is that, again, it sounds old and traditional, but focus on those key, long-lasting business principles that extend the opportunity for you to access the market when it's best for your company or opportunity. And that really comes from, I think, a couple things. One is financial discipline, ensuring that that is core and foundational to what you're doing, but also strategic and contingency planning. We do a lot of that here at Clio in understanding where we might need to be proactive in some areas to ensure that we've got plans. If Plan A doesn't work, what are we going to do for Plan B? And the last thing is, in all of this uncertainty, you have to remember that your customers are going through the same uncertainty. It's not just us as Clio in this bubble that is sort of dealing with this. All our customers are going through this as well. And so doing what we know we do really well is just emphasizing the importance of our customers, supporting them where we can, providing the tools, the information, the education that they need to continue to prosper with their legal practices, is critical to us. So that's what we're doing. I'm sure there's many other approaches, but we've just got to stay super agile in this environment, Mark.

What's next for Clio?

Mark Longo: Very good advice. Last question: what's next for Clio?

Curt Sigfstead: Well, we are focused on our customers. We're focused on developing and supporting solutions that will continue to make them successful in their business and in the industry of law. And so we're going to continue to invest in product, invest in our teams, invest in new geographies, to carry on the mission of improving the legal experience for all. We obviously, and we talk about this internally, we're building the foundations of being a hundred-year company. And it feels like, each day, each quarter, each year, is like we're just getting started. There's such an array of opportunities and there's just so much to do that we're going to be busy for a long time here. We've got large and huge and sort of ambitious revenue goals, and we'll execute against those as we do over time, both through sort of a focused M&A strategy as we've demonstrated with ShareDo and others historically, but also, importantly, organically. And I think you can count on us for at least continuing to build a strong ecosystem of partners and application performance or application integration partners, and helping drive the industry as a partner to where it needs to be for it to both provide incredibly rewarding careers for lawyers and attorneys, but also providing the best outcomes for their customers. So lots to do, lots of, really, what we've been doing over the history of Clio, but continuing to hopefully accelerate that and reaching higher because the growth and the opportunity demands it.

Mark Longo: A very inspirational vision. So Curt, with that, I want to congratulate you again on the Series F. Congratulations on the ShareDo transaction. You have built a world-class company that is truly global, but yet proudly headquartered in British Columbia, Canada. And I want to take the opportunity on behalf of Osler to thank you for participating in the Osler Deal Points Report webinar series. Thank you.

Curt Sigfstead: Thank you, Mark. And thank you for all you and Osler do, not only for Clio, but for Canada broadly, across the startup ecosystem. And again, thanks for all your help with the Series F and ShareDo and look forward to many more years of partnering together.

Mark Longo: It is our pleasure. Thank you.

Curt Sigfstead: Thanks Mark.