If you are a freelancer, chances are you have to deal with quite a few legal documents when you get hired for a new project. But while it’s great to get to that stage, getting a lawyer involved to go over a $3,000 contract isn’t exactly cost effective.
That’s where LegalSifter comes in. Using natural language processing, the service scans your documents (in Word format only, for now) and assigns them a score based on how favorable the terms are for the user. It also provides users with an explanation of the clauses and provisions in the document and suggests potential changes to provisions that are probably not in the user’s best interest.
The Pittsburgh-based company is backed by Birchmere Labs and was co founded by Elliott Williams and Lars Mahler. As Williams told me earlier this week, the idea for the project is based on his own experience of working on projects in his own design shop. “I wanted to do something to help small businesses get some help in this space where you are doing a project — maybe just a $500 project — and that comes with a contract,” he told me. “It doesn’t make financial sense to get a lawyer involved.” But without a lawyer, there is also a chance that you get burned.
Currently, the service works best for the kind of consulting contracts that designers and developers typically use, so the score the company assigns is most relevant for those types of documents. While LegalSifter is starting with this focus, though, it plans to expand to other areas as well.
The LegalSifter team worked with a lawyer to ensure that all of the information it provides is correct. Elliott agreed that some lawyers, however, will likely dislike the company’s service and because it could be seen as giving legal advice, he admits that there is a risk involved that the company could get sued. “We feel like we are treading a line,” he told me. “I do think that we might get into a little bit of trouble because lawyers may feel threatened.” The way he sees it, however, the company is educating its users and not advising them.
In some ways, LegalSifter is the proof of concept for the team’s larger vision, which is an intelligent contract management system for legal documents. Because of this, LegalSifter is available for free for the time being, and Williams hopes that once the company launches its next service, it’ll be able to convert some of its users to paying customers for that. The team tells me that it will still be a while before it will launch that part of the service, though, and LegalSifter’s current service will always be available as a standalone product.