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VCs can't stop investing in legal tech, and valuations are soaring.

By the numbers: Venture dollars in the sector have reached the $5 billion mark already this year, per PitchBook, after just $2.8 billion was invested in all of 2024.

Driving the news: This week, Clio raised ​$500 million, led by ‌NEA, valuing the legal tech company at ‌$5 billion.

In July of last year, Clio raised $900 million at a $3 billion valuation — meaning in about 15 months its valuation has jumped 67%.

Catch up quick: Just last week, Axios Pro reported on just how "euphoric" investors are about the space after a couple of big fundraises.

Harvey, which is building AI tools for law firms, raised $150 million led by a16z, and has seen its valuation jump from $3 billion in February to $5 billion in June, to now $8 billion.

New York City-based collaborative AI platform for lawyers, Legora, raised a $150 million Series C, led by Bessemer Venture Partners, at a $1.8 billion valuation — a 167% increase from the $675 million it was valued at just about five months earlier.

Zoom in: Big price tags are not stopping M&A dealmaking in legal tech, as Clio also said it completed its $1 billion acquisition of legal research platform ‌vLex.

What we're hearing: One way for legal tech startups to grow into their large valuation will be their ability to sell to in-house legal teams — not just law firms themselves — said a lawyer who helps legal-tech startups fundraise.

The bottom line: Despite investor excitement, the verdict is still out on whether many of the legal-tech startups can live up to their valuations.

VCs pony up for legal tech plays

Venture dollars in the sector have nearly doubled already this year.

Illustration of two gavels in a dueling position. 

VCs can&#x27;t stop investing in legal tech, and valuations are soaring.By the numbers: Venture dollars in the sector have reached the $5 billion mark already this year, per <a class="gtmContentClick" data-vars-link-text="PitchBook" data-vars-click-url="https://my.pitchbook.com/search-results/s595000379/overview_tab" data-vars-content-id="b9d20710-326a-4a99-bada-ba9079b4bbe0" data-vars-headline="VCs pony up for legal tech plays" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://my.pitchbook.com/search-results/s595000379/overview_tab" target="_blank">PitchBook</a>, after just $2.8 billion was invested in all of 2024.

VCs pony up for legal tech plays

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