After weeks of rumours, Harvey has announced a $300m Series D funding – one of the largest legal tech fundings ever. It says it is now valued at $3 billion. (See AL analysis below).
CEO, Winston Weinberg, said in a post: ‘Today, we are thrilled to announce our Series D financing led by Sequoia and including Coatue, Kleiner Perkins, OpenAI Startup Fund, GV, Conviction, Elad Gil, and REV, the venture capital arm of RELX Group which owns LexisNexis Legal & Professional.
‘In 2024, we saw 4x annual recurring revenue (ARR) growth and expanded from 40 customers to 235 customers in 42 countries, including the majority of the top 10 US law firms. We’ve also seen the legal and professional services industry shift faster than ever before. Lawyers are adopting technology at an unprecedented rate, centuries-old firms are experimenting with new business models, and enterprises are driving significant savings with AI-enabled workflows. The pace of change will only accelerate in 2025.’
‘This investment will enable us to continue improving our platform, scaling agentic workflows, building out integrated enterprise use cases, and growing our team.
Thank you to our customers, our employees, and investors.’
WOW…!
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Some thoughts from Artificial Lawyer
It’s fair to say there has been a degree of scepticism about Harvey. It seemed to come out of the blue, took the legal tech world by storm, perhaps didn’t communicate with the market as most companies tend to, and then headed not into just BigLaw, but inhouse and into CLM (via the Icertis partnership), and also pushed heavily into Small Law.
It has also hired people like an army in the middle of a life or death struggle – with mammoth salaries on offer, and new marketing efforts appearing all over the world.
Understandably, this ruffled some feathers in legal tech land.
Almost every time I have been at a conference or public event I have been asked: ‘Do you think Harvey will go bust?’ To which I always reply: ‘From what I have seen, they have taken on a lot of investment, but they’re growing really fast as well.’
And as the CEO above explained, they have grown revenue – by four X in 2024. Can they keep this going? Well, if you invest $300m in marketing and hiring great sales people, then yes, you can. Perhaps even more in terms of growth rate.
Is Harvey miles better than other products? I saw Harvey even before it launched, and I saw it in Nashville over the summer at ILTA. My balanced view – after having seen product walk throughs with literally dozens of legal AI companies – is that it’s a very solid product that can do a lot of things in the genAI field that lawyers can get real value out of. But, is it miles and miles ahead of everyone else….? No. But, it has – it’s fair to say – been better than some competitors at: A) getting potential buyers excited, and B) selling into multiple market segments at once.
Sometimes the winner in a market battle is not necessarily a far better product, it’s just a good product that the company is able to get into everyone’s hands, in fact so many hands all at once that it quickly becomes ‘the standard’, e.g. like Hoover was for vacuum cleaners.
In terms of the money it has now, and has also used already – which was no small amount before – Harvey can do a lot. As noted, aside from powering its engineering team, it can invest in sales. It can put people out on the road all over the planet with this kind of cash. From Sydney to Sao Paolo, they can go after Big, Small, Inhouse, you name it. And turn that investment into more revenue.
Also – and it will be a surprise to some at LexisNexis, but the legal tech powerhouse’s own parent company’s investment arm has put money into Harvey, i.e. RELX is betting on Harvey, even though they have spent millions of dollars on building out their own legal AI capabilities. One would guess there are some interesting conversations going on at LexisNexis towers today.
Finally, what is the exit? How does a $3 billion valuation legal tech company ever exit? Who could buy it? For now it seems that it’s a moot point, given that the company is only a couple of year’s old. But, at this kind of valuation an IPO in the future is not impossible. Let’s see.
Either way, those who thought that Harvey might fade away are now faced with the exact opposite reality: Harvey will grow, because it has the funds to grow. And because it has so much funding now….it will have to grow, and grow, and grow.
And this could just be the start of things.
Richard Tromans, Founder, Artificial Lawyer.