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Investment money pouring into legal AI
RICHARD WEINER
Technology for Lawyers
Published: August 3, 2018
Legal tech blogger Bob (“God”) Ambrogi just posted that $200 million in new investment capital has found its way to legal tech companies in just May and June of this year. The money went into companies that are either based in machine learning (sometimes called “artificial intelligence”), an increasingly important sector of legal technology.
Machine learning is used in predictive coding in the search for documents in large databases and in other large legal tech platforms.
The fact that outside investors are now pumping up this field means that everyone in the world is finally listening to me and Bob and the few of us who have been writing about all this for the last 25 years, so thanks for the vote of confidence!
Here’s where the money went:
$100 million (at least) to e-discovery software company Exterro from private equity firm Leeds Equity Partners, the first outside money that Exterro has ever accepted. The money will be used to integrate more AI into Exterro’s current framework. Leeds owns BARBRI (bring back memories?), and BARBRI owns the Association of Certified E-Discovery Specialists. Sounds like a powerhouse to be.
Toba Capital invested an additional $30 million in Seal Software. That company just entered into an agreement with DocuSign to support the latter’s push to automate agreements in its System of Agreement platform (automating contracts is a hot field in legal tech).
A group including Andreesen Horowitz and Menlo Ventures invested $25 million in Everlaw, an e-discovery platform.
An investor group including Goldman Sachs put $17.5 million into London company Eigen a company that uses AI in products developed for the financial, legal and professional services sector. The money will go into R&D (that’s the name of my blues band, but whatever).
Finally, British startup Tessian received $13 million to continue to develop its product, which uses machine intelligence to secure emails and other data for law firms and other enterprises. BTW—in England, e-discovery is called “e-disclosure.” It also costs $70 to talk to someone in London for like 15 minutes so don’t try it.
Project those investments out, and real capital investment firms are going to be investing in AI-based e-discovery platforms in the billions of dollars in the near future. So here we go.