In 2013, Thomson Reuters acquired London-based Practical Law Company in what industry insiders called one of the most strategic legal tech acquisitions of the decade. While the financial terms weren't disclosed, the acquisition fundamentally reshaped how legal information companies think about content, workflow, and competitive positioning.
Ten years later, Practical Law has become the gold standard for legal know-how platforms, powering workflows for thousands of law firms and corporate legal departments worldwide. The acquisition wasn't just about buying a company—it was about buying a vision for how legal technology should integrate expert content with practical workflow tools.
For legal tech founders building toward acquisition, the Practical Law deal offers a masterclass in strategic positioning and value creation that remains relevant today.
The Strategic Context: Why Thomson Reuters Needed Practical Law
To understand what made Practical Law acquisition-worthy, you need to understand Thomson Reuters' position in 2013. The company dominated legal research through Westlaw, but faced growing pressure from competitors and changing customer expectations.
The Market Pressure Points:
- LexisNexis was investing heavily in competitive platforms
- Law firms demanded more practical, actionable content beyond case law
- Corporate legal departments needed efficiency tools, not just research databases
- The legal information market was shifting from research to workflow integration
James C. Smith, Thomson Reuters' CEO at the time, identified the strategic imperative: "Quality and effectiveness have always been key to successful law firms and corporate legal departments. Efficiency has become equally critical."
Practical Law solved a problem Thomson Reuters couldn't solve internally: how to transform legal research from a time-consuming necessity into a productivity multiplier.
What Made Practical Law Irresistible to Buyers
Practical Law wasn't just another legal information company. The London-based startup had built something fundamentally different that created multiple acquisition premiums.
Premium 1: Expert-Authored Content That Scales While most legal information companies aggregated existing content, Practical Law created original, practical resources authored by experienced attorneys. These weren't just legal analyses—they were actionable guides, templates, and checklists that lawyers could use immediately.
The content model was both defensible and scalable. With more than 750 employees (principally in London and New York), Practical Law had built an editorial infrastructure that could create comprehensive coverage across practice areas while maintaining quality and timeliness.
Premium 2: Workflow Integration, Not Just Information The key insight that made Practical Law valuable was understanding that lawyers don't want more information—they want better workflows. Practical Law combined expert content with software tools that integrated directly into legal workflows.
This wasn't just about providing templates; it was about creating end-to-end solutions for common legal tasks. A lawyer working on an M&A deal could access not just precedent documents but complete workflow guidance, due diligence checklists, and closing coordination tools.
Premium 3: Cross-Selling and Platform Integration Potential For Thomson Reuters, Practical Law represented perfect strategic fit. The acquisition created what Smith called "a comprehensive suite of compelling productivity solutions that marry world-class legal information, expert know-how resources and software tools."
The strategic value wasn't just additive—it was multiplicative. Practical Law's content enhanced Westlaw's research capabilities, while Westlaw's distribution power amplified Practical Law's reach.
The Integration Strategy That Created Long-Term Value
Thomson Reuters didn't just acquire Practical Law and hope for the best. The integration strategy maximized value creation through systematic platform convergence.
Year 1-2: Maintaining Independence While Building Bridges The acquisition closed in February 2013 after regulatory review in both the U.S. and UK. Initially, Thomson Reuters operated Practical Law as a standalone business while building integration points with existing products.
This approach preserved Practical Law's editorial culture and content quality while gradually introducing cross-platform features that increased customer stickiness.
Year 3-5: Deep Platform Integration Thomson Reuters began integrating Practical Law content directly into Westlaw searches, creating a unified research and workflow experience. Users could seamlessly move from case law research to practical guidance without switching platforms.
The integration also flowed in reverse: Practical Law templates and guidance began incorporating live legal research, creating dynamic content that stayed current with legal developments.
Year 6-Present: AI and Analytics Enhancement Today, Practical Law content powers Thomson Reuters' AI initiatives, including CoCounsel (acquired from Casetext for $650 million in 2023). The expert-authored content provides training data and context for AI legal research and document automation.
With Practical Law, Thomson Reuters can now "access thousands of expertly maintained how-to guides, templates, checklists, and more across all major practice areas" enhanced by "powerful generative AI capabilities and the expertise of 650+ attorney editors."
Lessons for Building Acquisition-Ready Legal Tech Companies
The Practical Law acquisition offers five strategic frameworks for legal tech founders building toward exit:
Framework 1: Build Content Moats, Not Just Features Practical Law's editorial team of 750+ employees created defensible advantages that software features alone couldn't replicate. The content required deep legal expertise, significant investment, and years to develop comprehensive coverage.
For founders: consider how to create intellectual property assets that become more valuable over time rather than just building software that competitors can replicate.
Framework 2: Solve Workflow Problems, Not Information Problems The insight that lawyers need better workflows, not more information, differentiated Practical Law from traditional legal publishers. This positioning made the company valuable to acquirers focused on productivity solutions.
For founders: identify whether you're building information tools or workflow tools—the latter typically command higher acquisition premiums.
Framework 3: Design for Platform Integration Practical Law's content and tools were built to integrate with other platforms rather than exist in isolation. This made the acquisition strategically valuable beyond standalone revenue.
For founders: build APIs, integration capabilities, and data structures that make your company valuable as a platform component, not just a standalone solution.
Framework 4: Scale Content Creation Systematically Practical Law didn't just hire lawyers to write content—they built scalable editorial processes that could maintain quality across practice areas and jurisdictions. This operational excellence made the acquisition less risky for Thomson Reuters.
For founders: if content is part of your strategy, invest in editorial infrastructure and quality control systems that can scale without degrading quality.
Framework 5: Target Strategic Acquirers Early Practical Law built relationships with potential acquirers long before the acquisition discussions began. The company understood which strategic buyers would value their content and workflow integration capabilities most highly.
For founders: identify 3-5 potential strategic acquirers early and build relationships through partnerships, integrations, or customer referrals that demonstrate strategic value.
The Acquisition Premium Calculation
While Thomson Reuters didn't disclose the acquisition price, industry analysis suggests several factors that likely drove premium valuation:
Revenue Multiple Enhancement:
- Recurring subscription revenue from law firms and corporate legal departments
- Content licensing opportunities across multiple Thomson Reuters products
- International expansion potential (particularly in Asia-Pacific markets)
- Cross-selling opportunities to existing Westlaw customer base
Strategic Value Multipliers:
- Editorial infrastructure that would take competitors years to replicate
- Content that enhanced the value of Thomson Reuters' existing research platforms
- Workflow tools that increased customer stickiness and reduced churn
- Expert network that could accelerate product development across other legal tech initiatives
Competitive Positioning Benefits:
- Prevented competitors (particularly LexisNexis) from acquiring similar capabilities
- Created differentiation in an increasingly commoditized legal research market
- Established Thomson Reuters as the leader in practical legal workflow solutions
The Modern Context: What This Means for Today's Legal Tech Market
The Practical Law acquisition model remains relevant as the legal tech market evolves toward AI and automation. Thomson Reuters' subsequent acquisition of Casetext for $650 million in 2023 follows similar strategic principles:
Consistent Acquisition Themes:
- Content + Technology integration
- Workflow automation capabilities
- Expert knowledge that enhances AI development
- Platform integration potential
Current Market Implications: The legal technology market, now valued at $31.59 billion and growing at 10.2% annually, shows continued appetite for companies that combine content expertise with workflow solutions. Recent mega-rounds (Clio's $900M at $3B valuation) indicate that strategic acquirers are willing to pay premium multiples for market-leading positions.
Building Your Own Practical Law: Five Strategic Priorities
For legal tech founders aiming to build acquisition-ready companies, the Practical Law playbook suggests five priorities:
- Develop defensible content assets: Whether through expert editorial teams, proprietary data, or unique legal insights, build intellectual property that becomes more valuable over time
- Focus on workflow integration over standalone tools: Position your company as essential to legal workflows rather than optional productivity additions
- Build platform-agnostic architecture: Design systems that can integrate with multiple legal tech platforms, increasing your strategic value to potential acquirers
- Establish editorial or expert networks: Content quality and legal expertise create moats that pure technology companies struggle to replicate
- Target strategic partnerships early: Build relationships with potential acquirers through integrations, partnerships, or customer relationships that demonstrate strategic fit
The Enduring Value of the Practical Law Model
Ten years after the acquisition, Practical Law continues to drive value for Thomson Reuters through content licensing, AI training data, workflow integration, and competitive differentiation. The acquisition wasn't just successful—it was transformational for both companies.
For Thomson Reuters, Practical Law provided the content foundation for AI initiatives, workflow tools for customer retention, and differentiation in competitive markets. For Practical Law, the acquisition provided distribution scale, technical infrastructure, and resources for international expansion.
The strategic lesson remains clear: legal tech companies that combine deep legal expertise with workflow integration capabilities create multiple paths to value creation. Whether through organic growth or strategic acquisition, this model continues to generate premium valuations in today's market.
The next generation of legal tech acquisitions will likely follow similar patterns, with AI capabilities enhancing rather than replacing the fundamental value of expert content and workflow integration. For founders building in this space, the Practical Law playbook offers a proven framework for creating acquisition-ready companies that strategic buyers can't afford to ignore.
