Legal tech funding surged in 2025, reaching $3.2 billion in venture capital investment, according to a Business Insider analysis of Crunchbase data and recent financings. The boom reflects growing demand for AI-powered tools that help law firms and corporate legal teams work faster, smarter, and more efficiently. As AI moved from pilot programs to core operations, major law firms and general counsels began standardizing AI copilots for research and drafting, expanding innovation teams, and training junior lawyers—driving demand for new legal tech solutions. Among the standout companies, Legora raised $150 million in a Series C round led by Bessemer Venture Partners, despite not actively seeking funding. CEO Max Junestrand said the flood of interest came as the company built momentum, now serving over 400 clients across 40 markets, including top-tier firms like Cleary Gottlieb, Goodwin, Bird & Bird, and Sweden’s Mannheimer Swartling. Eudia, a new entrant in the legal tech space, made waves with a $105 million Series A from General Catalyst. The deal included a unique structure: $30 million upfront, with the remaining $75 million tied to acquisitions. Eudia used the funds to snap up two legal service providers—Irish-based Johnson Hana and Out-House—expanding its global footprint in alternative legal services. Bench IQ, a startup using AI to predict judicial behavior, raised $5 million in seed funding led by Battery Ventures and Inovia Capital. Co-founder Jimoh Ovbiagele, a former founder of Ross Intelligence, built a proprietary dataset and applied large language models to forecast how judges are likely to rule, giving law firms a data-driven edge in case strategy. Cassium, founded by Priyanka Kulkarni, a former Microsoft AI scientist who spent nine years on a visa, raised $5 million in seed funding. The company offers a software platform that streamlines the entire work visa process for employers, replacing manual Excel sheets and external law firms with an end-to-end digital solution. The product responds to the volatile and fast-changing U.S. immigration landscape. Covenant, co-founded by former WeWork general counsel Jen Berrent, raised $4 million to build an AI-native law firm. The platform uses large language models to analyze private market fund documents, flag risks, and suggest improved terms based on investor-specific playbooks. Marveri, a due diligence startup, emerged from stealth with $3.5 million in funding. Its software automates the review of corporate documents, cutting months of manual work down to minutes by renaming, organizing, and analyzing files. High-profile litigator Alex Spiro, known for defending Elon Musk and Alec Baldwin, is advising the team. Theo Ai raised $3 million in new funding from Run Ventures, bringing its total to over $10 million. The company is developing a predictive engine that helps law firms and corporations estimate settlement outcomes by analyzing historical case data. When a new case arrives, the model identifies similar past cases and returns a likely settlement range and probability. While some worry about a potential bubble, the strong buyer demand and real revenue traction across these startups suggest the market is grounded in genuine need. As AI becomes essential in legal work, 2025 marked a turning point—where innovation, investment, and adoption converged at scale.