ThoughtRiver, a London-based legaltech startup that’s applying AI to speed up contract pre-screening, has announced a $10 million Series A round of funding led by Octopus Ventures. Existing seed investors Crane, Local Globe, Entrée Capital, Syndicate Room, and angel investor Duncan Painter also participated in the round.
The UK startup is one of a number applying AI to automate work that would otherwise be done by legal professions with the aim of boosting operational efficiency. Other startups playing in the space include the likes of Kira Systems, LawGeex and Luminance to name a few.
ThoughtRiver argues it has a different focus vs the majority of contract view companies because it’s focusing on pre-signature contracts — with the aim of making securing a deal faster. “Almost all others are just employed to pull data from existing contracts. ThoughtRiver is as much in demand by Sales teams as it is by Legal,” a spokesman told us.
The Series A investment comes after twelve month’s of what it’s billed as significant growth for the 2015-founded startup, which says its automated contract review software is now being used by the likes of G4S, Singtel and DB Schenker. It launched a service at the end of 2017 and now has more than 25 customers around the world, per the spokesman.
It also trumpets inking a strategic partnership with professional services firm PwC — which will see the latter developing a service for its clients powered by ThoughtRiver’s software, according to a press release.
ThoughtRiver touts up to 95% in time and 80% in cost savings vs an initial contract review that’s carried out by in-house lawyers. And ‘faster contract reviews sum to increased deal flow velocity’ is its overarching claim.
On the tech side, ThoughtRiver has created an ontology of contract legal logic, couched as a series of detailed questions which, combined with its natural language processing (NLP) engine, enables its software to pre-screen contracts by generating a risk assessment. It will also suggest tweaks to the legalese to remediate problems, including via a plug-in for Microsoft Word, where customers’ in-house lawyers may prefer to work.
Other benefits the startup touts are data extraction to power contract analytics at scale — such as for due diligence or to assess the impact of regulatory change. Its sale pitch also suggests that easy access to an overview of contractual positions helps customers by enabling better-informed business relationships.
ThoughtRiver has already established offices in New York, Singapore, London, Cambridge and Auckland. It says the new funding will be put towards further growth in the US market, where it will be dialling up sales and marketing efforts. Expanding integrations with major tech partners is also on the cards.
Commenting on the funding in a statement, Akriti Dokania, early stage investor at Octopus Ventures, said: “While the legal sector has been slow to adopt AI compared to other industries, ThoughtRiver has a proven business model based on solving a fundamental issue for lawyers. By using an advanced Natural Language Processing engine to drive faster contract reviews and acceleration of deal flow and business growth, legal professionals can work more efficiently than ever. We are thrilled to support the ThoughtRiver team with its plans for global expansion as the firm disrupts an established market and set of processes.”