This article is Part Four of our series featuring workers displaced by the recent waves of tech layoffs who decided to found their own companies. In Part One we chatted with investors and founders and looked at data for early-stage startups. Part Two profiled entrepreneur Peter Henry and the fintech he founded in Latin America. In Part Three, we checked out the state of accelerators during the downturn. — Special Projects Editor Christine Kilpatrick
A series of layoffs at online mortgage lender Better.com last year left thousands of former staffers scrambling to find a job. But not Anmol Sahai. He was thinking term sheets.
Sahai, a 27-year-old Colorado native, joined Better in 2018 as a loan consultant, working his way into a post as legal analyst a year later. Alongside his job, Sahai was studying for a law degree at City University of New York.
The combination of work and studies helped germinate the idea that culminated in his legal tech startup, Composure, when Sahai had trouble finding software geared for managing workflow at a busy and growing in-house legal department.
After getting laid off from Better in August, Sahai, now a law school grad, had time to devote to startup building. In subsequent months, he and his team developed an initial product they’re pitching to in-house legal teams as a tool to streamline workflow and help manage incoming requests, documents and internal communications.
Sahai said momentum picked up in December, when the startup got initial backing from seed and early-stage investor Day One Ventures.
“That started accelerating things,” he said, noting that shortly afterward, co-founder and CTO Ilia Rogov, also a former Better employee, came on board. The company also landed its first enterprise client, along with some smaller customers.
Composure is now going out for a pre-seed round. There’s no hard target at the moment, but Sahai said comps for similar rounds usually fall in the $1 million to $3 million range. So far, the startup has raised a little over $300,000 from Day One and angel investors.
From suing to SaaS
Part of what makes in-house counsel workflow appealing from a startup perspective is that it is both complex and kind of repetitive.
Day-to-day workflow, as least for a larger organization, is likely to include both inbound and outbound litigation. Unfortunately, as companies scale, Sahai noted, eventually “it’s just a fact of life that someone’s going to sue you.” (Or vice versa.)
Beyond lawsuits, there’s usually a lot of in-house work around compliance and regulatory approval. This can be a particularly large workload for companies in heavily regulated industries like finance or health care. In addition, in-house legal teams have to devote resources to overseeing intellectual property protection, internal investments, and weighing in on terms for vendor and sales negotiations.
The idea behind Composure is to make it easier to track the tasks and documentation involved in all those myriad responsibilities, and to divvy up workload accordingly.
Starting in a downturn
While this is not the easiest time for startups to find funding, Sahai for now sees advantages in launching a company amid a market downturn. For one, out of necessity, everyone is focused on capital efficiency. That ought to have some long-term advantages.
Customers are also tightening their belts. As a first-time founder, Sahai said in the past year he’s realized how much resilience is required to keep a nascent venture afloat. Most queries end in rejection, with only the outliers culminating in a “yes.” He compares the relentless forward push to football:
“You’re punting a lot. … And then, once in a while, you find a gap and you run it down for a touchdown,” he said.
Illustration: Dom Guzman
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