Blackletter Raises $6 Million to Build an AI-Enabled Law Firm

By Amara Osei

Blackletter raised a $6 million seed round, CEO and co-founder Jonathan Rosenbluth told Business Insider. Lerer Hippeau led the investment. It marks Lerer Hippeau’s first check in legal, a firm spokesperson said.

Business Insider reported that other backers included Seven Stars, Maple VC, Garage Ventures and Ripple Ventures. Cohere founders Aidan Gomez, Nick Frosst and Ivan Zhang also invested, according to Business Insider.

What is Blackletter building?

Business Insider characterized Blackletter as the latest startup law firm trying to take clients away from Big Law. The Canadian neofirm combines technology and lawyers to offer businesses legal services for flat fees, Rosenbluth said. He said artificial intelligence offers a way to build something sturdier than the traditional model.

Its lawyers use software built on large language models to draft and negotiate routine corporate contracts. The software also guides transactions from term sheet through diligence and signing, according to Business Insider.

Blackletter says it has more than 75 clients, including Fanatics, TwelveLabs and Ada. Ada has just agreed to merge with fellow customer-service agent company Dialpad in a $600 million deal, Business Insider reported.

Why does Weil Gotshal matter?

Artificial intelligence has forced Big Law to rethink how legal work gets done and how clients pay for it, Business Insider reported. The publication cited the collapse of Weil Gotshal as evidence that the traditional model can come apart.

Rosenbluth described Weil’s collapse as a reminder of the existential risk facing legacy firms. He said rainmakers can leave at any time and clients can follow, then compared a partnership’s collapse to the speed of a bank run. Blackletter’s founders say its learning system can avoid a repeat, according to Business Insider.

Blackletter is betting that clients will return because it understands their business and does the work well, rather than because of a relationship with one partner, Rosenbluth said. Lessons from each matter are meant to inform the next, Rosenbluth said. Lawyers refine how they use the tools, while engineers adapt the technology to help them get better results.

Rosenbluth spent a summer during law school at Skadden, where he watched associates a decade his senior grind through menial work. He said the experience drew him to the legal industry but convinced him that traditional practice was not the career for him.

Before starting Blackletter, Rosenbluth rose through the ranks at Cohere, the fast-growing artificial intelligence model maker, where he led partnerships and product teams, Business Insider reported. The Canadian government recently said it was taking an equity stake of up to $1.6 billion in the Toronto-based company.

Who built the firm?

Business Insider reported that Blackletter co-founder David Stewart was also a former Cohere executive. At Cohere, he led a team that worked with customers and prospective buyers to shape its products around their needs, according to Business Insider.

Business Insider reported that third co-founder Avi Brudner previously served as chief operating officer of Blue J, a tax-data company. He also worked as an attorney at Fried Frank, according to Business Insider.

Blackletter is now hiring lawyers, Business Insider reported. Its team includes former associates at Latham & Watkins, Goodwin, Dentons and Osler, Hoskin & Harcourt.

Can the model scale?