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Tech Companies CS Disco and Kaltura Aim to Upend Their Sectors. They Had Impressive IPO Debuts.

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CS Disco is aiming to be at the forefront of software companies looking to digitize the legal sector, according to co-founder and CEO Kiwi Camara. 

Founded in 2013, CS Disco, which goes by Disco (ticker: LAW), provides cloud software that aims to simplify ediscovery, legal document review and case management for businesses, law firms, legal services providers and governments. The software helps centralize legal data into a single solution, while improving security and privacy for clients. 

“We’re using automation and AI to help lawyers automate the part of the practice of law that doesn’t require human judgment,” Camara told Barron’s. “The mission of Disco is to use technology to strengthen the rule of law.”

On Wednesday, Disco was one of five companies that listed its shares. The stock opened at $45.26 and closed at $42.59, up 33% from its offer price. At $42.59, Disco is valued at $2.4 billion. 

Camara said he expects software to transform the legal sector much the same way it has disrupted other industries. Software, he said, will help law firms and attorneys “get to the truth” in some of the most important legal issues including the opioid crisis and the meme stock investigations. “We think there is an opportunity to build an independent software company in the legal space,” said Camara, who is an attorney that also holds a degree in computer science. 

Disco, which is short for discovery, plans to use proceeds from the IPO to invest in its “go-to market engine” and for R&D, he said. The Austin, Texas company decided to go public now because “there [hasn’t] been a big winner in legal tech. We can lay claim to that space,” said Camara, who said it was symbolic that DISCO was able to get the ticker “LAW.”  

Kaltura (KLTR) also made its public equity market debut. The New York company had originally planned to list its shares on April 1. It ended up delaying the deal after the collapse of Archegos Capital Management, a hedge fund, in late March that caused some IPOs to drop below their offer prices and others to delay. “The joke was on us,” said Ron Yekutiel, Kaltura’s CEO. “It was the worst week for new issuance.”

Kaltura held off going public until this week. Shares opened Wednesday at $11.50 and closed at $12, up 20% from its offer price. At $20, Kaltura’s market capitalization was about $1.5 billion.

Founded in 2006, Kaltura provides a technology platform that powers several forms of videos including video portals, town halls, video messaging, webinars, virtual events and meetings, as well as virtual classrooms. It has over 1,000 customers including IBM ( IBM ), Dropbox (DBX), Bosch, Thomson Reuters (TRI) and SAP (SAP). 

Kaltura provides a more robust platform than companies like Zoom Video Communications (ZM) or Microsoft Teams, which are focused on video on demand, Yekutiel said.

“We are a leading virtual event platform for all large corporations,” he said. For example, Amazon Web Services re:Invent 2020 pivoted from an in-person to virtual event with 6,000 registered. It ran on Kultura, Yekutiel said. Any time a corporation needs a heavy video platform to “videofy” corporate learning, webinars, virtual events and meetings, they turn to Kaltura, he said. “We are the heavy hammer to do complex things,” he said. 

The company plans to use much of the IPO proceeds to increase sales and marketing. Kaltura has 650 employees and plans to be north of 800 by the end of the year, Yekutiel said. It has made three small acquisitions in the past and will look to do more, he said. “Having equity you can trade as a public company is helpful. We’re looking forward to having new shareholders,” he said. 

Write to Luisa Beltran at luisa.beltran@dowjones.com