Reena SenGupta speaks with chairman Mike Schmidtberger and new partner hire, John Budetti, an ex Kirkland and Paul Hastings partner.
In June, Norm Ai, an AI company focused on regulatory compliance for financial institutions, reached unicorn status following a $120m Series C funding round that gave it a $1.2bn valuation. It raised eyebrows in the profession because Norm AI is also the founder of a native AI law firm, Norm Law, set up in January 2026.
Mike Schmidtberger, the chairman of Norm Law, says “What sets us apart in the legal AI space is that we have both an AI platform and a native AI law firm, that competes directly with Big Law for institutional clients, with pricing that is tied to outcomes, not hours.” Norm Ai has now raised more than $260M in three years. Its key investors over the three funding rounds include Khosla Ventures, Craft Ventures, Bain Capital Ventures, Coatue, Blackstone, Vanguard, Citi, New York Life, TIAA, Henry R. Kravis, Marc Benioff, Tony James (former President, chief operating officer, and executive vice chairman of Blackstone) and significantly, Jeff Hammes, the former chairman of Kirkland & Ellis.
Its founder, John Nay, initially focused on regulatory compliance, recruiting technologists, mid-level engineers and lawyers who could understand both regulation and code. The series B funding round in October 2025 enabled the company to build software solutions around the law as well.
The segway into setting up what has become one of the most significant native AI law firms was a natural step into the ‘adjacent possible’, the term coined by the writer Steve Johnson as to how innovation tends to happen in linked stages. Nay saw the opportunity to automate legal workflows for his financial service clients and had a ready-made team of 35 legal engineers to turn the idea into reality.
His recruitment of Schmidtberger, the ex-chair of a Big Law firm, Sidley Austin, gave the project instant credibility. Other partners and senior associates from elite law firms such as Ropes and Gray, Proskauer and Paul Hastings have followed, with the law firm now fielding 25 lawyers as of August 2026. Norm AI is a Delaware company and Norm Law is an LLP, both head-quartered in New York.
Schmidtberger says Norm Law tends to appeal to lawyers at both ends of their careers: the fixed-share partners for whom equity is a distant horizon and the older partners who want to work differently.
Clients have also encouraged their lawyers to move, claims Schmidtberger. “They have suggested to them that they would love them more if they work with Norm on an efficient platform that can give certainty on cost and speedy delivery,” he says. And two lawyers – one from Pillsbury Winthrop (Sam Lipson) and Justin Rattigan (previously at Bain Capital Ventures) now co-lead the firm’s emerging companies and venture capital group (EC/VC). They had worked together before as client and external counsel.
One of the firm’s most recent hires, John Budetti has a track record at both Kirkland & Ellis and Paul Hastings. He is in many ways a sweet spot hire for Norm Law. An experienced funds lawyer, he also set up his own legal tech consulting firm on leaving Big Law as he could see the impact AI was going to have on it. “I spent seven months in an MIT program and two years in legaltech, working to better understand AI and to reframe my approach to our profession,” says Budetti.
At Norm Law, he says it’s the “combination of trust and technology” that makes the firm so appealing. “Domain experts provide top legal advice. To deliver that counsel as efficiently as possible, our lawyers and engineers sit together, almost like on a trading floor, training the technology in real time and bringing that standardisation to clients.”
One difference from a traditional law firm, Budetti says, is the systems thinking. “The core design element of a traditional law firm is to learn and react. Here, the technology requires an additional step. To earn and keep client trust, we have to first connect the dots and invest significantly in critical thinking upfront, as well as continuously push information from the learn/react model into our feedback loop.”
Norm law is still a law firm in some foundational ways: the lawyers have trusted relationships with clients, they negotiate deals and give legal advice but instead of training younger lawyers they train agents. “We are still solving clients’ problems,” says Schmitberger. “But our partners don’t have to come with books of work and they get to go home to dinner.”
Besides the EC/VC group, the firm focuses on eight other areas: investment funds and SEC regulatory work, real estate, commercial contracts, technology transactions, M&A/private equity, public filings, finance and tax. “We are doing transactions or discrete workflows in these spaces where there’s a substantial dislocation between the cost of the work and the value that the client ascribes to that work,” says Schmidtberger.
He marvels at their ability to get audiences with general counsel at major financial institutions such as Blackstone, Goldman Sachs and NY Life. “Only a year ago, it would have taken a decade [for a new law firm] to get in front of these clients,” says Schmidtberger.
Certainly, the clients we spoke to for this article are intrigued by the native AI law firm value proposition: the prospect of being able to do low-value work with quality partners and technology, by-passing the need to instruct a second or third-tier law firm.
But are Norm Law partners just AI super validators? Schmidtberger says no. “Our lawyers take the role they would have in any other law firm.” He also says that Norm Law has no intention of going up the value curve into Big Law territory even though they are taking away significant segments of work from these firms.
Nor does he feel that Big Law can encroach on Norm Law’s territory, despite the recent announcement of Kirkland & Ellis’ half billion-dollar investment into building AI products. Put simply, says Schmidtberger, traditional law firms are not incentivised to innovate in ways that would cut their billable hours.
However, he is sceptical about how many Big Law firms will survive the AI revolution and sees the recent uptick of partner-poaching sign of an oncoming reset. “We are seeing more friction between Big Law and clients on workflows.”
While financial momentum has been in favour of Big Law, he doubts whether this will last for all firms. “There is a fair bit of law sitting in Big Law firms that is dissociated from its value in the eyes of clients,” he says. Luckily for Norm Law, enough blue-chip clients seem to agree with him.
