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Flashes of Thought

Big bets on Legal AI

By 11. July 2025July 12th, 2025No Comments

Legal AI Summer: Big bets or hot air?

The legal market is considered conservative, but in the US and UK in particular, legal AI start-ups are currently springing up on a weekly basis – with high financing rounds.

In recent months, the following deals, among others, have made the headlines:

🔹 Harvey – $300 M (Series D) – OpenAI / LexisNexis – US Legal AI
🔹 Noxtua – €80 M (Series B) – CMS / Dentons / C.H. Beck – European ‘sovereign’ legal AI
🔹 Legora – $80 M – Y Combinator / Benchmark – Stockholm, ‘collaborative AI for lawyers’
🔹 EvenUp – $135 M (Series D) – Legal Workflow Automation
🔹 Wordsmith – $25 M – Edinburgh, Legal Agents for Inhouse Teams
🔹 Definely – $30 M (Series B) – London, Agentic AI for Lawyers
🔹 Flank – $10 M (Series A) – Berlin
🔹 Luminance – $75 M (Series C) – Slaughter and May
🔹 Ravical – €7.3 M (Pre Seed) – Lakestar – Legal AI Agents
🔹 Vertice – $50 M (Series C) – Lakestar – Procurement / Spend Mgmt

💭 Is this capital well invested – or a risky bet?

On closer inspection, many of these start-ups simply rely on existing large language models (LLMs) and add a fancy user interface or workflow engine on top. This can offer added value, but is ultimately easier to replace as soon as a competitor taps into the same API.

I don’t play in the above-mentioned financing league myself, but I regularly receive pitch decks from legal tech founders who are building convincing solutions with significantly less capital. As an Alex Hormozi-fan and a bootstrapper, I therefore often ask myself:

Why do you still need 80 million to automate legal work today?

Especially when top legal AI solutions are already available – without VC money:
👉 Agents, chatbots, assistants, document stores, legal workflows – all developed owner-funded without US LLMs or hyperscaler clouds, hosted nicely sovereign in Europe.

What do you think? 🔥

Comments

Sybren Raaijnmakers, Founder

Couldn’t agree more. contractuo – €0 VC capital, 100% bootstrapped, own legal AI system developed from scratch

Own model instead of wrapper: Contractuo didn’t just put its AI on top of an existing OpenAI or Anthropic API, but a proprietary one

Model specially trained for legal documents and contracts – including special retrieval and reasoning layers.

Demanding live clients: The system is already running productively at some of Europe’s most demanding law firms and corporate legal teams – in other words, exactly where fault tolerance and data protection requirements are particularly high.

Bootstrapped & profitable: Without a cent of external capital, the team has built a market-ready product and generated revenue.

Zero Marketing Approach: A Website? It didn’t exist for a long time. Contractuo relies on the product to speak for itself in demos and in tough everyday use – and is therefore mainly passed on through recommendations.

Antti Inanen, tech lawyer, legal design enthusiast, AI geek

Good stuff.

The money itself is almost secondary. You don’t need massive capital to build an AI wrapper today. You can bootstrap it easily.

What REALLY matters is the support from top VCs like a16z, Benchmark, Google behind Harvey, Leya, and Hebbia. Their networks, credibility, and hands-on help can’t be overstated, especially if your goal is to define the category.

Large rounds and high valuations are part strategy, part theater. By pushing up valuations early, investors try to position startups as category leaders quickly, even when the underlying tech isn’t all that unique (lol we know it isn’t). It’s as much about owning the story as it is about the actual product.

In the legal-AI-tool-for-lawyers “cyborg” race, there will only be a few winners. Realistically, not many firms will get licenses for Harvey AND Leya AND Claude AND something else. This scarcity pushes valuations even higher.

But the cyborg phase will last only a few years, and there will be many more opportunities after that.

There will be completely new types of legal work and new ways for humans and machines to work together (or not).

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