LegalTech is Booming as Companies Rethink Contracts

By Jordan French Jordan French has been verified by Muck Rack's editorial team
Published on January 28, 2021

Like most other areas of corporate life, legal teams scrambled to adapt to remote work as the pandemic struck this past year and adapt to a “new normal.” But, as one of the industries that has been least disrupted by technology to date, the shift left many lawyers reassessing how legal work actually works. It led to a boom for the LegalTech space where software and AI solutions are innovating ways for legal teams to work more efficiently with less burnout. 

One of the areas within LegalTech seeing the most growth is contract tech, where lawyers are eager to harness smart technology to streamline one of the most tedious aspects of law. 

That’s where Contract Review Automation (CRA) comes in. Pioneered by LawGeex in 2014, CRA provides an AI-driven solution for companies to automate the review and negotiation of contracts in significantly shorter periods of time. It also provides  robust risk mitigation because the software is configured to scrutinize contracts based on a company’s own legal policies and protocols. It’s been proven to detect even complex pitfalls within a contract that veteran human lawyers may miss.

Co-founded by  former Israeli military intelligence soldier turned corporate lawyer Noory Bechor, LawGeex has been growing rapidly ever since as the global leader of CRA. They  raised their latest round of $20M in venture capital last summer as more investors are eager to get a piece of the LegalTech pie.

The growth of CRA is poised to fundamentally change how the legal industry operates and more broadly, how dealmaking happens across every industry. We sat down with Judi Crimmins, LawGeex’s director of global marketing, to get a better understanding of how CRA works and what it means for the future of law.

GritDaily: What are some of the key benefits of CRA?

Judi Crimmins: CRA brings the benefits of accelerating contracts, reducing risk, and cutting legal costs. That’s key. And unlike outsourcing to external law firms or ALSPs, it has the added benefit of keeping high-value legal work in-house. Senior lawyers have more direct control and customization options over the performance and quality of legal services delivered. 

Of course, legal teams have been using technology to handle various tasks for a while; the shift began with administrative functions like document management and billing. However, the global emergency response to Covid-19 has ushered in new drivers and market trends, like the need for speed and the importance of business continuity. This has compelled legal teams to accelerate the adoption of AI and automation tools. Given the economic downturn, they are expected to do more with less, and maintain responsiveness despite a reduction in headcount and capacity. 

GD: What are the inefficiencies that exist in many legal teams from a productivity standpoint?

JC: First, contacts are often inefficient. Contracts were originally created to set and align expectations and achieve lasting, common ground. The problem is that they have become more complicated overtime and gradually departed from the idea of governing behaviors. We’re no longer focused on win-win situations, but on maximizing our own benefit and piece of the pie, which takes everyone away from the original purpose. Contract inefficiency creates an expectation gap. It opens a chasm between the expectations that are created on one side of the relationship and how people believe those expectations will be met on the other.

From a productivity standpoint, legal professionals work long and stressful hours, which can mean that the demands of the job are intense and often exceed the resources to meet them. Legal teams reap numerous benefits when they shift labor-intensive tasks away from legal professionals and let an AI-driven solution like CRA carry the load. It doesn’t just work faster than people; it completes the work with greater accuracy. It helps future-proof and mitigate risk in contracts by ensuring all contracts are reviewed accurately and consistently. 

Another benefit is enhanced agility and the ability to focus on strategic goals. With more time available, the legal team can be more responsive to business units who need immediate attention to an emerging legal issue, enabling those units to be more agile in response to rapidly-changing market conditions. With CRA taking on tedious, routine work, lawyers are free to focus on more impactful work. No longer the perceived corporate “bottleneck,” legal departments can operate as strategic business partners, improving organizational competitiveness and achievement. 

GD: What capabilities does LawGeex AI-driven CRA possess?

JC: LawGeex is sufficiently advanced to address many challenges faced by legal teams. It has the capability to diagnose, redline, and fix contractual issues during live negotiation, delivering dramatic risk reduction across all routine contract types.

The AI-powered platform compares the contract to a company’s predefined legal playbook to identify unacceptable or missing clauses. It understands legalese, and unlike solutions which only do issue-spotting, CRA marks up the contract to eliminate routine work while providing real-time alerts and analytics. 

Using CRA can yield significant ROI, and not only in terms of budget. Legal’s contribution to improving enterprise capacity while maintaining its control over managing risks is a crucial driver to accelerating company growth in 2021 and beyond.

GD: Is CRA suitable for both small and large enterprises?

JC: Absolutely. LawGeex works with both small and large enterprises; from startups to Fortune 500 companies like eBay, HP, and PepsiCo. 

GD: Will AI tools like CRA be replacing lawyers? 

JC: When the words “AI”, “future” and “law” are used in the same sentence, lawyers often worry they are about to be replaced with a robot, but those reactions are unfounded. On the contrary, CRA was originally created by a lawyer to empower lawyers. When innovation and AI tools are introduced in a company, the typical result is a shift in the types of work people are doing, not in eliminating positions.

By Jordan French Jordan French has been verified by Muck Rack's editorial team

Journalist verified by Muck Rack verified

Jordan French is the Founder and Executive Editor of Grit Daily. The champion of live journalism, Grit Daily's team hails from ABC, CBS, CNN, Entrepreneur, Fast Company, Forbes, Fox, PopSugar, SF Chronicle, VentureBeat, Verge, Vice, and Vox. An award-winning journalist, he is on the editorial staff at TheStreet.com and a Fast 50 and Inc. 500-ranked entrepreneur with one sale. Formerly an engineer and intellectual-property attorney, his third company, BeeHex, rose to fame for its "3D printed pizza for astronauts" and is now a military contractor. A prolific investor, he's invested in 40+ early stage startups through 2021.

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