Hey everybody, Richard Trumman's here again, Artificial Lawyer TV. Today we have a special guest, Max, the founder, co-founder, CEO, at any rate, of Legora, someone I've met a couple of times, but never really done a proper interview with. Hi, Max. Great to have you on the show.
Hey, Richard. Really great to be on. I'm a frequent reader, so it's fantastic to be on the podcast.
Fantastic. Well, yeah. And I just thought for once we'd, you know, have a proper detailed chat with you about a whole bunch of different things. So, this isn't a short blast. This is more of a sort of long form interview. So, if you're watching this, get a cup of tea and a biscuit and sit down because we're really going to explore Legora in detail. So, let's start at the beginning. So, you're from Sweden originally. How did Legora start? You woke up one morning and just went, I know, legal tech. Brilliant. Let's do it. I mean, how did it come about? Because you're not a lawyer, are you? By background,
I'm not a lawyer. I'm an engineer. And it's going to sound like the start of a great joke. So, back in 2020, there was a lawyer, physicist, and then my two co-founders, August and Sig, who sort of ran into the early versions of the BERT model and the GPT-1, GPT-2. And the lawyer had a summer job in the courts where he was tasked with summarizing court cases and finding similar court cases to the one that he had sort of gone and that was extremely manual. It took a lot of time and the results weren't very promising and so they started exploring, you know, how can we work with AI to solve these types of tasks and it was really sort of in the very early days pre-LLMs and what turned out was it was really hard to solve those challenges especially in Swedish or sort of non-English languages and so the project sort of got put on ice and then fast forward to 2023 the GPT-3.5 comes out we build a prototype for this thing and it just works flawlessly like it's amazing.
The lawyer and the physicist then decide to go off and work in a court and to go and work on quantum computing. And so there's like a third spot that opens up and they call me and they go, "Hey, Max, we really want you to be involved in this." So I join and about one month later since we decided to work full-time, we win sort of the first, you know, big client engagement. We started working with the biggest law firm in the Nordics, Mannheimer Swartling. And after that, we were sort of off to the races. So it was really summer 2023 and I think when LLMs came out we sort of saw three really strong application areas. It was coding, customer support and legal work. And since we had this background, you know, having tried and failed a couple of times, we really wanted to go solve the problems in legal that nobody had solved before. I think the legal sector had also sort of maybe skipped a few previous generations of digitalization. So the amount of work that needed to be done and still needs to be done like I like to say that we've done zero to one and now remains one to 10 and then 10 to 100. That's what's fun about it.
Interesting. So just to pick up on that, so you were a friend of these co-founders. So effectively you might say the ancestor of Legora already existed and then you joined effectively as a third sort of founder.
I think that it's safe to say that the seed was there, but then, you know, I came in and we sort of, I think refocused is a good way of putting it. August and Sig had built a lot of different things and it was sort of a Frankensteinish hobby project and then we wanted to professionalize it and also we
They're still with you. They're still part of it.
So Sig is full-time with the company and then August and Lua split in November of last year.
Gotcha. Gotcha. Gotcha. So, okay. So, you get up and running. You first of all, you're called Leia. Then you become Legora. Was Leia because you just thought people are going to think this is Princess Leia. We should probably change.
Oh, actually, I got to credit the name to August. If I'm not mistaken, it means loyal to the law in Latin. Lei is law in Spanish. And so, there was sort of some Latin word play there. And also we liked a name where you could refer to Leia where Leia would give a response and then you sort of could refer to it by name. And then with the name change, I mean look, we really started making a move from not only Europe but also sort of the SMB to the enterprise market and we wanted the name to sort of one reflect the more enterpriseness of our product and we also wanted to take the opportunity earlier this year to sort of, you know, rebrand the company like we had been very European focused. We had, you know, raised our series A then very closely after the Legora change we launched in the US launched our series B and sort of things started to sort of
Gotcha. Gotcha. So well let's talk about today. So I mean it's hard to believe that Legora has only existed for such a short time because you and another company we'll come to later that begins with a H dominate the airway at least in the legal tech space. I mean where are you now? Where are you on funding? Where are you in terms of people offices?
Well, I'm calling in from our London office and I think to date we've raised $265 million which sounds like a really big number. It is a really big number in legal tech that is a lot of well until very recently a company that's only been around for three years that would be an enormous amount.
And look, I think Richard it's important to note we only launched in sort of general availability in October 2024. So we only really launched like a year ago a sort of, you know, one year and two months and so in that very short period of time we've scaled from close to a couple of customers to over 550 and we've opened offices in Denver, London, Stockholm of course, India, Sydney with many more hubs incoming and we've decided to keep product and engineering in Stockholm. You know, the reason why we've launched so widely and why I think this year has been so incredibly successful is that the demand for great products and teams that really care about sort of the success of the firm is enormous. And so as we'll maybe get to like yes like Legora was not the first player in this space but we have executed with an enormous amount of focus and emphasis on product.
So when the LLMs arrived, I think there were many different approaches to how to build products on top of them. Some were fine-tuning models, some were sort of jumping straight into the application area. We decided very clearly that like the models are going to keep improving and the products that you can build on top of these is going to expand very quickly and I mean the first version of Legora was really like a ChatGPT, you know, interface and now it's so much more right like it's an entire suite. The mobile app coming, there's the portal, there's tabular review, there's the Word add-in, the Outlook add-in. There's so many things sort of getting bundled together. What's exciting for me is that this product roadmap is being created sort of as we go together with our clients because AI is new to everyone and yes we're sort of super nerdy about it and, you know, we get to work with OpenAI we get to work with Anthropic we get to work with Google to see what's coming sort of, you know, around the corner.
It's our job to take the value of those models and the value of the frameworks and interpret them for the legal sector. So, how can we squeeze the most value out of this for our clients?
Well, let's just come back to that in a second, but just on the spread of staff, it's interesting that you're keeping your core engineering team in Stockholm because obviously that's not a cheap location. The engineers there will probably not charging the same kind of salary rates that they are in Palo Alto. I don't know, but maybe they are these days. Why is that? Is that because you just wanted to keep that kind of cohesion? You know, you didn't want to outsource it to the Philippines or whatever, you know, you wanted to keep it
So we will never outsource engineering. We are an engineering-led company. I'm an engineer, my two co-founders were engineers as well. The value that we build over time lives in the product and what people can achieve with the product. Sweden and Stockholm in particular I think really sort of hits above its weight when it comes to building big tech companies with Skype, we have Spotify, with Klarna, so much more right like I used to work with Anton actually he hired me at his previous company so there's a lot of tech talent in the market and there's, you know, maybe there's a path where we'll open additional engineering hubs in different countries but I think now we're sort of, you know, everybody's in the same room everybody's coming to work in person build new features and we think about what can we build today that has the most value and what will we do the sort of, you know, in the next month because that's really how quick the iteration cycles are.
Yeah. No, it makes a lot of sense to be together and so India just to clarify because I think some people sometimes get confused when a legal tech company opens an office in India. They say oh okay so that's like a secondary engineering hub, you know, is that so
This is a proper office. It's a GTM office. We work with some of the biggest Indian law firms like CAM and we want to be able to support them on site with legal engineers, with customer success, with support and I mean India is a very fast growing market and we want to make sure that we're there to help them scale their
Yeah, I mean just as an aside my fastest growing readership group I mean for a long long time Artificial Lawyer's main audience has been the US followed by the UK. My fastest growing readership group is India which is over European countries now which is
And, you know, our office in Sydney and I think the Australian market has been extremely quick to adopt right because Australia is a very interesting market it's very competitive locally and everybody's looking at how can we gain an advantage over, you know, over the next firm and of course, you know, we start to look to tech.
And is on the global bit I mean how I mean your investors why Y Combinator and others, you know, some of which we met at Legal Innovators California over the summer. Actually, I was talking to one of your earliest investors from Sweden this week. I'll tell you about that off camera later. Yeah. But anyway, the global aspect, is that absolutely central because okay, the US, UK obviously very large markets, the US even bigger than everybody else by a substantial degree. But do you have to be global to fulfill your destiny if you want to get all Star Wars on it? Right? You know,
I obviously think so given that, you know, we've scaled this way and I think what's important is that the change that AI brings in ways of working, how to structure your business is profound and it requires local expertise and local assistance with that entire transformation that needs to happen. And so, you know, why are we in the US? Well, of course it's a big market, but also we have huge clients there and we want to be on site with them sort of in the trenches and say how is your firm going to succeed in a sort of, you know, existing AI world and in a post AI world like how do you bring success? I think it's important to note that like the product is one thing but there's an enormous amount of service around the product when you implement Legora at say a Linklaters it's a massive firm they have offices all over the world and we want to make sure that we meet them everywhere, you know, I think you could say that like yes you could build like a B2C product from Sweden or from wherever and scale it. But if you want to be B2B enterprise, I think it's a kind of a different motion.
Yeah. Yeah. No, I mean a lot of the early legal AI companies just wanted to sell software and they very very very soon realized you couldn't just sell software to the legal market. Not yet anyway. Maybe at some point in the future, but yeah. Well, and just one last point on that on the investment target and so forth. I mean the clearly your backers want you to be global not just because it helps to serve global firms like etc. But because the goal is to build a category leader or at least one of two or three or four dominant, you know, what I call, you know, productivity platforms. So broad multi-purpose platforms, that presumably is the goal. I mean, you know, if you're not looking to hit, you know, X revenue and then stop. This is we're looking like
Absolutely not. You know, we're going global on revenue and, you know, yes, you could look at what the investors thinks, but at the end of the day, like, you know, we're the ones running the company and we've only gotten started and as I said, you know, it feels like we've done the zero to one, like a lot of the work we've done has been the foundational work to now continue building the next interesting thing. And I think
Absolutely and once you get to a point where and also I think as the base models improve as well that's just going to carry you. It's almost like that's like the wind carrying the ship along.
It is completely. Yeah. We like to call it the rising tide and we build all our functionality like boats so that, you know, they sort of improve when the tide rises.
Well let's talk about the products. So the biggest thing that you've come out with recently is the portal and that ties in with a lot of different people commenting similar sometimes a little bit different but all interrelated points around knowledge management, knowledge sharing, law firms have this knowledge, the clients have this knowledge, there's a gap between them, it's inefficient, how can we tie the two together
And also just working I mean I think it's important to note we're not just thinking about collaboration or sort of how multiplayer would look like like we've built it and we are I think we've now gotten to a state as a company where we're setting the precedent which also happens to be the name of our event in New York. We're setting the precedent of, you know, what are the new things that should exist in this product category. We are innovating. If you take the portal as an example, it was also born out of a real personal pain. When we've collaborated with our law firms on our fundraisers, we've worked in a 300 long email chain that's so long that it doesn't load on Gmail and the attachments are really hard to find. And how can that experience be as fluent, as smooth as something like Figma where the designer and the reviewer or client can come onto the same platform and really collaborate in real time. It's awesome. And that has never happened in the legal world and that's what we want to bring.
And why did you choose that particular setup? So as far as I understand it's for clients who sign on to the law firm's portal.
That's right. That's right. So
Rather than the other way.
Well, it actually works both ways, but we're very much focused and initially focused on the law firms. And the reason is we're getting a lot of inbound from in-house teams who are saying hey we heard our law firm is using X, you know, we also want it or, you know, we want to think how should we think about deploying AI in our business and I think that's a real opportunity for the law firms to offer a white-labelled, firm-specific product to those clients and then go that's awesome that, you know, you also want to start using AI by the way we already have created these workflows, these templates, these playbooks that you can self-serve on. And the reasoning, Richard, is sort of like if AI can complete a task, it will complete that task. And the law firms are sometimes scared of innovating because it might hinder their existing business model that's based on, you know, the amount of hours that you work. And so we want to build the software, the vessel, the solution to that problem so that they can retain that client relationship and deliver that work in a, you know, 2025 way and that has never been done before.
Well, I mean I don't know. I mean I suppose highQ and others might disagree a little bit.
Yes. But if you talk about highQ in my mind like highQ is more like static file sharing than it is here's a process, here's a workflow, here's a work product that you can leverage and self-serve on and I think there's if you look generally in the legal tech industry like what I think has happened pre-LLMs is a lot of the really exciting solutions were being built and then they got acquired and there was like a little bit of a lid that sort of I wouldn't say hindered innovation but kind of did.
Yeah, no, I mean no makes sense I mean people could only operate within the bounds of their technological environment and that prevented some very good ideas going back as far as developed, right? But I think now we have the pleasure and the privilege of showing up and saying we're going to be the most ambitious and we're going to be sort of laser focused. Like I think it's the best time in history to be a lawyer because never has this many sort of talented people been working on building delightful products that is going to make their lives much more fun.
Well, let's just dig into this one briefly because got you here. So, let's talk about it. I mean, you know, it is the elephant in the room particularly for the law firm. So, the in-house teams, it's slightly different although they most of them obviously have come from big law. So there's a sort of cultural sort of imprint, you know, been sort of like engraved tattooed into the back of their brains. So it's not a slam dunk that in-house lawyers will be radical disruptors. But on the law firm side, it's very interesting like at Legal Innovators in London three days, every single person on stage was really really using this technology now. They weren't talking about it in a theoretical way. They weren't talking about oh yes, you know, I redrafted an email using
Right. Right or whatever.
They were just like no this is really part of our work now and that was fantastic that was a really great and it was for me, you know, like I said in the piece that I wrote afterwards it was kind of like a big moment because after talking about this for a decade almost now it's happening now we move on to the next bit which is okay so part one over wonderful part two how do we actually transform the legal business model right you've alluded to it a couple of times yourself right so we're going to bump into this business model so you'll even have people inside law firms who are desperately wanting to really use AI as much as they can. They don't see it as a threat. They see it as a force multiplier, improves their products, the clients love it, etc. But the business model that they're framed within,
is just like we're not built this way. We're not built. So, how do you as someone who is one, you know, one of the two most well-known new legal AI companies, you must be butting into this every single day. How do you negotiate this?
We are committed to helping law firms and legal service providers get over this hump and I don't think it touches everything. I think that's important. AI is not a silver bullet for every task and for everything yet and I like to think of it as almost like on one axis you can have sort of complexity and on the other axis you have sort of time and, you know, if we start today we can solve like you said like we can summarize something and we can do more complex stuff than that but it's going to keep growing and over time we'll sort of solve more and more complex tasks and if AI can solve something it will solve it and so the law firms will be and the legal service provider will be faced with the decision of do we want to keep this work and if we want to keep that work we likely need to find an alternative fee arrangement to be able to deliver it in a smart way and at a competitive way and I think firms who lead with this proactively versus reactively when they get pushed by their clients I think will have much more success in the market.
Are you having this discussion with the firms because fundamentally AI it's an economic
But like in, you know, like in some of the pilots that we run when they, you know, stack up different products they have findings like we used to spend 6 hours on this thing and now it takes 20 minutes and that's a real impact. However, is the value that they're providing any less? No. Right. And the client was willing to pay something much bigger than 20 minutes times the hourly rate. Right? So I think that there's a value discussion to be had and I think pricing will be one of the really hard challenges and interesting problems to work on frankly and I think some firms will do this transition really well. Some will do it less well and I think there'll be winners and losers and I think this is a time and a place where rankings can shift or will shift.
There will be consolidation in the legal market. Law firms will be buying law firms because there'll be new types of sort of scale benefits when it comes to how you can deliver this in effective ways. How you can proactively have the conversations with the client, how you can use your data, how you can turn your work into AI processes. All of this is happening all at once and it's probably my most common, you know, type of discussion that I have with legal service leaders.
But what do you think about the new model army? You know, that I sort of wrote about on Monday and it's been growing, you know, like Covenant, Crosby, whole bunch of them, UDI, some are developing their own stuff off the back of public LLMs and developing their own things others are actually using your tool there's one company that sort of name checked you I mean
