Legal IT Insider speaks to LawGeex VP of marketing, Shmuli Goldberg (pictured), about the strategy behind this latest huge cash injection.
Contract review automation vendor LawGeex has closed a whopping $12 million funding round led by venture capital fund, Aleph. The investment brings LawGeex total funding to date to $21.5 million. Previous investors, including Lool Ventures, also participated in this round.
The LawGeex SaaS platform uses AI to remove the legal bottleneck of reviewing and approving everyday business contracts before signing.
“We help businesses run faster and better by automatically answering one simple question: ‘Can I sign this?’” said Noory Bechor, co-founder and CEO of LawGeex in a statement out today (17 April). “Customers who once waited weeks to get a simple contract approved can now complete the entire review and approval process in under sixty minutes. Legal teams can finally focus on the big picture instead of getting lost in paperwork.”
Aleph, who led the round, has a track record in backing companies disrupting traditional industries. The team previously invested in Lemonade, CommonSense Robotics, and WeWork. Aleph partner, Eden Shochat, will be joining the company’s board.
The additional capital will be used by LawGeex to fortify its position as the category leader, deepen its product offering, and expand its US presence following the opening of its New York office earlier this year.
LawGeex VP of marketing, Shmuli Goldberg, tells us more:
Why have you gone for another funding round now?
“Our last funding round was about a year ago. Since then we’ve seen incredible market adoption. We feel that legal AI has gone mainstream. A year ago, we were talking to reporters about funding and saying that the market had taken to us and customers had a lot of interest. Now we’re past that. Legal AI is mainstream and there has been a seismic shift in attitudes: we’re no longer seen as fringe or niche. We’re no longer being bought by innovation teams but by business teams. As well as inhouse legal teams, we work with compliance teams, procurement teams and those are the teams that have a need to review high volume contracts with little budget and they are now at the stage where they use AI every day.
The shift is that people are no longer saying they are interested in AI; they are saying they have a pain and our technology can fix it.
Is that more to do with the development of the legal operations role and maturing of in-house legal teams or an acceptance of AI?
It’s a combination of both but definitely the former. The rise of legal operations and maturity of inhouse teams means that they are no longer thinking like law firms – that they have to cover every single possible risk. A few years ago the legal department was the only deparment in the company that didn’t have a fixed budget. Compliance had a budget, HR had a budget, procurement had a budget and the legal team said “the budget is whatever it costs us” but that has changed.
Legal operations has arisen because of that change – the teams have targets and budgets and deliverables and that has forced a maturity.
It’s not to do with AI – we’re solving the problem and it’s about the solution not the AI.
What is the funding needed for?
It’s not so much about need as it’s an opportunity. We’re currently seen very much as market leaders and we want to capitalise on this market momentum while it’s fresh. We want to continue to research the technology itself and to increase the gap in the breadth of the contracts we support and the number of clauses we can spot.
Recently we opened an office in the US and we are very much expanding our business and especially with the market being where it is, there’s a genuine opportunity to move things forward: it’s a question of striking while the iron is hot.
So what is the main focus for investment: tech or business?
The major focus will be technology. However, there is a significant amount going towards growing the business, which is around 40-50 people right now.
If we find the right people I expect we could be double that by this time next year.
In Israel, we’re hiring some of the best technologists: data scientists and computer scientists.
In both the US and Israel we are hiring customer-facing people, such as customer success managers and account managers.
We just opened in New York and have around half a dozen people there. Right now, we’re focussing on Israel and New York.
Aleph is brand new to us. We had a few other investors we were talking to but in the end it was obvious that Aleph really is an incredible VC fund. They are known not only for a great track record but a genuine focus on how to disrupt traditional industries. See what WeWork has done to the small business space or what Lemonade has done to the insurance space. They look at industries that have been technologically stagnant and fund companies that have a positive effect on transforming those industries. The team are incredible and bring so much value.
Are you able to tell us about your recent performance?
We are still under 100 customers. The customers we’re talking to are large enterprises: Fortune 500 and 1000 companies. We have a few medium-sized companies in our portfolio so I’d say we work with medium to large enterprises.
Are you interested in growth outside of the US?
We’re always interested to look at the non-US market. While the US is our primary focus, there are definitely huge opportunities in Europe and while the UK market is smaller, you could argue that its further ahead.