LegalFly, a Belgian startup which is building a generative AI copilot for lawyers, has raised a €15m Series A. The round was led by Notion Capital, with Redalpine and Fortino Capital also participating.
It comes just eight months after LegalFly’s €2m seed round — which saw Deepmind exec Mehdi Ghissassi invest in the business — as the startup looks to gobble up market share in the face of stiff competition in the nascent but crowded AI for legaltech space.
2024 has seen a string of raises for startups offering GenAI-based tools to try and automate lawyers’ work, as VCs bet on the promise of the technology to streamline processes like drafting and reviewing documents.
LegalFly will use the funds to grow its team and expand across Europe.
Autonomous legal services
While a number of startups in the legaltech sector boast a cofounder with experience in law, the CVs of LegalFly’s founding team have a very different professional background — they all previously worked in the product team at Tinder.
“I often say that we went from the sexiest industry in the world to the least sexy,” says founder and CEO Ruben Miessen. Frustrated by the lack of AI adoption at the dating giant, Miessen and three of his product team sat down and worked out which industries were ripe for disruption from the tech.
“We were looking at what GenAI was good at, which is synthesising data and generating content,” says Miessen. “What industry works like that? Law, and it does it all in a very manual way.”
Founded in 2023, LegalFly uses large language models (LLMs) to automate mundane legal processes like drafting agreements, reviewing contracts and running compliance checks on documents. It also has a ChatGPT-like Q&A tool trained on internal company data and wider legal regulations.
LegalFly is hoping to automate entire workflows in the legal profession, eventually. “We believe that in about two years from now, we’ll be able to release legal AI agents that can act and negotiate autonomously for the majority of the more repetitive legal tasks — like drafting, reviewing and negotiating contracts — performed by in-house legal teams,” says Miessen.
While the startup says it counts “dozens” of both law firms and enterprises as customers, it’s targeting the latter — like banks and insurance companies — going forward, as the potential deal size is larger because of the scale within those organisations, says Miessen. There’s also the opportunity of upselling between departments within enterprise clients, he adds.
LegalFly is sold as a subscription model based on the amount of users per customer. For clients with 100 or more people with access, it costs €99 per month per user.
Crowded space
LegalFly is just one of a number of European genAI legaltech startups that’ve picked up cash in the past six months.
In the UK, Robin AI picked up $26m in January, Luminance raised $40m in April, Definely $7m in May and Wordsmith AI $5m in June. Sweden’s Leya Law also raised $10.5m in May.
It is a “crowded space”, says Miessen — and it’s why LegalFly went back out on the fundraising roadshow so soon after picking up its seed round — of which it still has 80% of the cash from.
“Momentum in the market is immense,” he tells Sifted. “At law firms, everyone is hiring a head of AI. Why? Because they’re ready to buy [AI solutions] now.”
It means players in the market need to act quickly to snap up as much market share as possible ahead of the competition, Miessen adds. “Over the next year, clear winners in the space will emerge.”
LegalFly’s got some ambitious growth plans to try and secure its place in that winning cohort. It will triple its team — currently 18 employees — over the next six months in its bid to increase revenue five-fold and take advantage of the “generational market opportunity” in the legal profession.
Read the orginal article: https://sifted.eu/articles/tinder-legaltech-raise-legalfly-news/
