Generative AI is getting better at interpreting dense texts, and this progress has proven to be a boon for startups attacking one of the most complex sets of texts there is: the law. It makes sense then that we’ve been seeing a new burst of activity in the legal tech space off the back of advancements in AI in the last year or so.
Legal tech startup Eudia bagged $105 million only last week; London-based Genie AI raised €16 million last year; U.S.-based Harvey landed a $300 million round led by Sequoia; and Lawhive raised $40 million to go after ‘main street’ U.S. lawyers. The latest addition to that list is Luminance, which is billing itself “legal-grade” AI.
Claiming to be capable of highly accurate interrogation of legal issues and contracts, Luminance has raised $75 million in a Series C funding round led by Point72 Private Investments. The round is notable because it’s one of the largest capital raises by a pure-play legal AI company in the U.K. and Europe. The company says it has raised over $115 million in the last 12 months, and $165 million in total.
Luminance was originally developed by Cambridge-based academics Adam Guthrie (founder and chief technical architect) and Dr. Graham Sills (founder and director of AI). It was seed-funded by the late Dr. Mike Lynch, founder of Autonomy, who died in a tragic accident last year.
Luminance uses what it calls a “Panel of Judges” AI system to automate and augment a business’ approach to contracts — including generation, negotiation and post-execution analysis. The startup uses a proprietary large language model (LLM) to power its main product, Lumi Go, which lets customers send draft agreements to a counterparty and have the AI auto-negotiate on their behalf.
Rather than using a GPT (Generative Pre-trained Transformer), Luminance uses what it describes as an LPT (Legal Pre-trained Transformer) that’s trained on over 150 million verified legal documents. Many of these documents are not publicly available, which, the company says, makes its platform relatively defensible. Other legal tech startups tend to build on existing general-purpose LLMs.
“It’s a domain-specialized AI that is built with lawyers in mind […] They need to understand that the outputs have been validated and can be trusted, and that’s exactly what our specialized AI can achieve,” said Eleanor Lightbody, the startup’s CEO who took over from the founders after its Series A round.
Lightbody explained that the platform was built with the understanding that each model is good at different things. “What you want is to have a mixed model approach, where the models can check each other’s ‘homework,’ and you can get the most accurate and the most transparent answers,” she said.
She claimed this approach sets Luminance apart from its competition as its clients can use its platform across the entire contract life cycle.
Luminance currently has more than 700 clients across over 70 countries and includes names like AMD, Hitachi, LG Chem, SiriusXM, Rolls-Royce and Lamborghini. Its headcount has tripled in North America after it opened three offices in San Francisco, Dallas and Toronto, and expanded its U.S. headquarters in New York.
The Series C also saw participation from Forestay Capital, RPS Ventures, and Schroders Capital, as well as existing investors March Capital, National Grid Partners, and Slaughter and May.