‘Is this the end of the first legal AI pioneers?’ is a question you might well ask as the ink dries on Evisort’s agreement to sell to Workday. Artificial Lawyer takes a look at just how much the market has consolidated as legal tech M&A continues across the sector and considers whether the new legal genAI pioneers will experience the same outcome?
For this site at least, ‘legal AI’ as a subject really got going in the 2010s, coming to broader market attention in around 2015/2016 as a growing number of startups arrived, using machine learning and earlier versions of Natural Language Processing. Then one-by-one, some quite rapidly, others only just recently, were bought.
Here are some:
- RAVN – an early pioneer of using ML/NLP in the legal field, sold to iManage in 2017
- eBrevia – a very early contract analysis pioneer, sold to Donnelly Financial in 2018 – but has recently relaunched as an independent company. One of its co-founders, Ned Gannon has also created a new company focused on inhouse needs, Coheso.
- Kira Systems – contract analysis – sold to Litera in 2021, from which Zuva, a new independent company was born.
- Seal Software – contract analysis, mostly for corporates, sold to DocuSign in 2020, reportedly for $188m cash. After that deal several key team members left the company and are working on other projects related to AI, for example Jim Wagner has created The Contract Network.
- Leverton – a Germany-based legal + proptech pioneer for AI contract analysis, sold to MRI in 2019. The company had a bumpy journey and was soon sold after it got started.
- RFRNZ – also a German legal AI company, started early, but closed down in 2021 after a lack of demand from lawyers there.
- (ROSS Intelligence – pioneered the use of ML/NLP in case law research. Didn’t do a sale, but ran into some….er, how can we put it…..’legal issues’ in relation to Thomson Reuters in 2020. However, ROSS really captured the imagination of many lawyers and did a lot of work to raise the awareness of what legal AI could do. P.S. worth mentioning that the company still exists in a very minimal form while its dispute drags on, although doesn’t appear to be operating as it did before. Its founders are all also working at new companies.)
- RAVEL – another early pioneer of AI in research, Ravel was sold to LexisNexis not that long after getting noticed in 2017. That deal followed LexisNexis’ purchase of LexMachina in 2015 – yes, that early – a company that truly was very quick in using ML/NLP for legal research.
- LexPredict – a small, but forward-thinking contract analysis startup created by Dan Katz, sold to Elevate, the law company, in 2018. Katz now is working heavily in genAI with a new venture.
- Della AI – more of a second wave of legal AI companies, also focused on contract analysis, sold to Wolters Kluwer in 2022.
- Eigen Technologies – also part of this second wave, also focused on contract AI, but not just for legal. Had Goldman Sachs as an investor. Sold to CLM company Sirion this year (2024).
- Casetext – another pioneer in the legal research field, sold to Thomson Reuters for $650m in 2023. Started very much in the field of ML/NLP, but unlike many others was quick to see the future value in LLMs, and by the time ChatGPT arrived had done plenty of work with genAI.
- Evisort – while seen as a CLM company, it was really a contract analysis company that started back in 2016 at Harvard and could have gone in many directions, but went after CLM. Workday announced it will buy the company this week.
There are some others, including some that shone very brightly, very quickly, and disappeared just as fast. But, those above you will probably have heard of. And they all have plenty in common: they all leveraged to a greater or lesser extent machine learning technology that existed before generative AI. Some later tapped genAI as well, but that was not the tech they were founded upon.
Plus, we have also seen Tim Pullan, the founder and CEO of ThoughtRiver, which really explored how you can use ML/NLP to analyse contracts for risk, and is aimed mostly at inhouse legal teams, step away from the top role there. Although the company is very much still going.
And it’s interesting to see just how many of these early founders have gone on to create new legal AI companies, e.g. Ned Gannon, Noah Waisberg and Jim Wagner. So, while one company they helped to build was sold, that is not the end of their startup journeys.
Standing on the Shoulders of Giants
Some founders create companies with the sole intention of selling as fast as possible. Others see their startup as the beginning of a life-long journey and hope to build something massive. In reality, because of external investment, most startups end up selling (or stop trading) after several years, with very few making it past 10 years, in fact even seven years is doing well. So, all of the above is natural.
For this site what it really means is that we truly are at the end now of that first wave of early pioneers who saw in AI an opportunity not just to build a company, but to change the way the legal world operated.
As they say, we all stand on the shoulders of giants, because there’s always someone who paved the way before we arrived. In this case, the generative AI companies now growing and multiplying can be seen as a third wave of legal AI businesses, but based upon a new type of tech.
They too benefit from the great work done by those who came before them, as that first wave of legal AI companies helped to make the market familiar with the concept of using software not just as a basic utility or an information storage system, but to actually perform the work of a lawyer: to change the means of legal production. And that remains the central goal.
Also, if history repeats itself – and that seems likely – in a few years from now Artificial Lawyer will be writing an article about where all the legal genAI pioneers went. X company got bought by a non-legal sector conglomerate. Y and Z companies were bought by one of the Big Two. A and B went bust, or ceased to trade. And perhaps one or two will just keep going and become huge companies that dominate their market segments. And so on. The cycle will repeat.
And that’s the incredible thing about legal tech. There is so much energy there. So much dynamism – just consider all of those companies above. Now consider the growing number of new ones, from Harvey to Leya to Robin AI, and many more. It keeps on coming…!
To the first pioneers, Artificial Lawyer salutes you. To the new generation this site says: good luck and may the legal AI gods always be in your favour!
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Tomorrow, we look at some of the companies that were part of that first wave of legal AI, but are still with us as independent businesses. It’s an ever-decreasing club, that’s for sure!
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Legal Innovators UK Conference – November 6 + 7, London.
P.S. if all of this fascinates you, then….come along to the Legal Innovators UK conference in London, Nov 6 and 7, where generative AI’s growing impact on the legal sector will be explored across multiple sessions. There will also be plenty of the leading genAI companies taking part and they will have plenty to tell you about where things are heading and what they can now do.
For more information about speakers and companies taking part, please see here.
And to get your tickets now, please see here.