- Legal tech startup Everlaw has raised $US25 million in a series B funding round led by new investor Menlo Ventures, with participation from existing investor and famed Silicon Valley venture firm Andreessen Horowitz.
- CEO and founder AJ Shankar said the company wants to invest more in artificial intelligence.
- Everlaw has doubled revenue year over year in the last two years, and is now being used by every US state attorney in all 50 states.
Berkeley, California-based legal-tech startup Everlaw has raised $US25 million in a series B funding round led by new investor Menlo Ventures, with participation from existing investor and high-profile venture firm Andreessen Horowitz, the company announced Thursday.
Everlaw is a cloud-based e-discovery platform that lets lawyers easily organise and search through millions of documents, videos, emails, and pictures exchanged between legal teams before a trial. In big cases, terabytes of data are passed between lawyers and without software, it can take hundreds of hours for paralegals to comb through them.
In an interview with Business Insider, founder and CEO AJ Shankar said the money will be used to invest in artificial intelligence, which the platform already uses in some capacity to suggest – using data from past behaviour – what documents it thinks will be a priority or what documents should be looked at next.
Eventually, Shankar says, he wants Everlaw to be able to surface those suggestions instantly from the initial upload as well as derive intelligence about user behaviour across multiple cases.
“The harder problem we’re trying to solve is what we can understand about this giant corpus of data without users even telling us anything,” Shankar said. “Forget legal, that’s a hard problem in AI in general.”
The company declined to disclose its valuation, but it has seen huge success with revenue, which it says has doubled in the last two years. Shankar added that Everlaw is in “growth mode,” so the company is cash-flow neutral and not profitable right now.
All 50 states
Shankar founded Everlaw after getting a computer-science degree from the University of California, Berkeley. While he was a student, he acted as a consultant for a local law firm on technical issues and used both his engineering knowledge and familiarity with law firms to start Everlaw in 2011.
There’s already several e-discovery platforms on the market, but those legacy systems are at times clunky and expensive, Shankar said. Indeed, according to some estimates, e-discovery can account for up to 70% of the total cost of a lawsuit. Plus, Everlaw is only one of a handful of e-discovery platforms heavily investing in sophisticated artificial intelligence, something Shankar said gives Everlaw an edge.
Everlaw is also differentiating itself with a handy “post-review” feature called StoryBuilder. The tool lets users who aren’t directly looking through the documents to organise particular information and evidence into a narrative that can be used at trial. It cuts down the feedback loop between the people doing the discovery component and the people building the case.
“That way of litigating, we think it’s really powerful,” Shankar said.
Since Everlaw can handle huge cases, the company is marketing itself toward medium and large law firms, gaining customers from top-tier firms. Unlike Logikcull, another leading cloud-based e-discovery platform that has recently gotten attention from Silicon Valley, Everlaw isn’t going after people representing themselves, or mum-and-pop law firms.
Everlaw is now being used by the US state attorney general offices in all 50 states. At first, it was only used in a handful them, but when attorneys general started working together on multi-district cases, word spread and eventually the platform was adopted by all of them.
“In these major litigations, we’re a major, if not the best contender they got,” Shankar said. “It’s been a great viral growth opportunity for us.”
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