Lawyers beware, there’s a new startup in town that is going to take the legal business by storm. It is called Atrium and is the brainchild of Twitch founder and CEO, Justin Kan and Silicon Valley business lawyer, Augie Rakow. Although the company is still in its early stages, it has made humongous leaps since its beginnings. Starting last winter, they have been a part of Y Combinator, the prestigious accelerator that has launched companies such as Dropbox and Airbnb to success. However, today Atrium announced that they have received a $65 million investment from venture capital firm, Andreessen Horowitz. This is only the beginning of their takeover.
The concept of Atrium came from problems Justin Kan faced in his career as a tech entrepreneur. He realized how inefficient the current model for law services is. “Law firms generate revenue from hourly billing, and lack an incentive to vastly improve efficiency,” Chen wrote to TechCrunch. Essentially, Kan believed that the model for a law firm impeded innovation within the field because they firms make more money using this old model. In fact, over $300 billion is spent in the enterprise legal market, and predictable pricing still does not exist. This provides issues for startups scraping for funds because law fees can be often too costly and prevent the business from ever growing.
With this in mind, Kan and Rakow created Atrium, with the focus of eventually creating a law firm that offers upfront pricing and higher efficiency. They achieve this by using machine learning to ingest piles of documents and to speed up the process of fundraising, writing commercial contracts, and dealing with equity distribution. Since all time consuming activities within law will eventually be completely automized through Atrium’s software, their lawyer’s are able to focus on the most important aspect for a startup, advising them on what they should do next.
Although many legal tech startups exist (CaseText, Premonition, etc.), all of them are simply providing a single tool for lawyers to use. However, Atrium is literally a fully tech-enhanced law firm. Since their start, they have provided legal support for over 250 startups including transportation app Bird and digital pharmacy Alto. They have secured over $500 million in financing for their partners which is an extremely impressive figure for a one year old law firm. They have also grown to over 100 employees and are planning on completely upscaling the company by next year.
As of now, Atrium’s technology is limited to only a narrow type of cases. With their new large investments, Atrium is going to fully focus on research and development for their more advanced machine learning software. This will allow them to continue advancing the quality of their services and eventually will be so powerful that it will put paralegals out of work. A scary thought, but also quite a realistic one for our automated future.