Is Beagle the First Legal AI Casualty?

Remember Beagle? It was one of the first wave of legal AI companies with a focus on document review and analysis, and rose to international fame in 2016. Now, however, the company appears to have ground to a halt and its charismatic CEO and founder, Cian O’Sullivan, is ‘uncontactable’.

While it’s important to note that Beagle as a corporate entity may well still exist, the business has reportedly ceased to engage with the outside world, and as far as Artificial Lawyer can see it has become lost in a Canadian startup snow storm. And if this is the case, then it would mean that Beagle could be the first legal AI casualty.

We have had other startup casualties recently, such as DealWIP. But, Beagle is especially significant, as it had been among the first wave of legal AI companies that helped to re-draw the legal tech map and had shown great promise.

How Did We Get Here?

Dentons’ NextlawLabs was an early backer of the Canadian legal AI company, so were a number of individuals. The Kitchener-based startup was officially founded in 2014 and by 2016 was hitting the headlines. And at that time its brand name was mentioned in the same sentence as many others that were making a big impact on the legal tech market.

Artificial Lawyer reported on how the startup had won the procurement function of VW in Germany as a client back in 2016. This was soon followed by a JV deal with leading Australian law firm, Corrs, in October of that year.

Rather than just focus on the large and busy North American market, or perhaps focus its growth on the intense London, UK market as some peers had done, Beagle went straight to fully global.

Over the next couple of years O’Sullivan and Beagle were often in the headlines and seen attending conferences. Those that saw the founder speak noted how impressive he was on stage.

Moreover, the company’s success came at a time when the legal market as a whole was opening up to the use of machine learning systems. Everything seemed to be going Beagle’s way.

And then, in late 2018 it all appeared to stop.

AWOL

A strange pall of wintery silence has fallen over Beagle.

As of right now the www.beagle.ai domain is ‘parked’ on a marketing page of the Instra web hosting company. Yet, Beagle never announced it was going to have a hiatus. Social media feeds also seemed to suddenly freeze and go dark from about the summer of 2018 onwards.

Despite this sudden drop off the face of the world, the company didn’t send out a public SOS. In fact, Artificial Lawyer had an email exchange with the company as late as Feb 2018, when everything still seemed to be going fine.

More recently, multiple attempts to reach CEO, O’Sullivan, have resulted in no response. Investors were contacted and they were also strangely non-committal.

So, what has happened? Artificial Lawyer spoke at length to two people familiar with the company and they told the following story. This is what can be said at present:

At some point in 2018 something changed with the dynamic CEO, O’Sullivan. It’s understood that his appearances at the office became less frequent, to the level that staff stopped turning up for work as well. Things at Beagle started to fall apart.

Efforts were made to reach him, but failed. In effect, the leader of the company had – these market insiders report – gone AWOL. By the end of 2018 O’Sullivan was, it would appear, no longer willing to respond to efforts to contact him.

It is also understood that the vanishing of the CEO has created a fair amount of challenges for the investors, including Dentons’ NextlawLabs / NextlawVentures.

One person who wanted to remain anonymous, told Artificial Lawyer that a particular issue is that a notable amount of the funding from some of the investors that was provided to the startup, was in the form of debt instruments, i.e. loans, as opposed to cash in exchange for a slice of company equity – which also usually means some level of influence or control as well.

This meant that when Beagle began to fade, there was not much the lenders could do. Most were not shareholders – it is understood. I.e. once the cash had run out, if the company didn’t keep creating new revenue the ‘investors’ had little to nothing they could do from a managerial perspective.

It is understood that one or more of the investors have now taken up a course of legal action in relation to Beagle in Canada. Artificial Lawyer contacted Dentons about this, but they refused to comment on this specific matter.

One person contacted by this site suggested this approach could – in theory – lead to taking control of the corporate entity – although it remains unclear if that is the main goal.

In fact, this entire matter remains under something of a cloud – and with many of the parties involved apparently keen to keep things that way.

In part this is because of the clearly sensitive nature of O’Sullivan’s ‘disappearance’, as one person familiar with the matter put it.

This site does not seek to explore people’s personal circumstances and so will not go further in that direction. However, it’s clear that this is as much a story about personal challenges as it is about business, and therefore we must consider this company’s problems with a high level of sensitivity and empathy for the considerable strain that running a growing company can cause for a founder.

As to what triggered the change, one person familiar with the company suggested that it may simply have been that the various deals the company had made around the world didn’t deliver sufficient revenue to sustain it – and, as is often the case, the business started to run out of money. More will hopefully come to light in the months ahead.

What Next?

It may well be possible to recapitalise the business and start a new, second phase of life. That’s why it’s important to note, as said above, that when it comes to Beagle – while it may look comatose – there may be life in the old dog yet…!

Whatever happens next, this site wishes O’Sullivan all the best and hopes that whatever challenges he has right now, he will overcome them.

1 Comment

  1. Thanks for adding the well wishes for O’Sullivan. Founders are under tremendous pressure and most startups don’t succeed. They may indeed be more to the story than we can see at present.

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