Contract review remains a slow, manual process that strains legal teams, forcing lawyers to sift through dense language, flag risks, and translate legal terms.
Tokyo-based LegalOn Technologies seems to have walked through an open door to that specific market: its AI contract review software for legal teams is today used by 7,000 organizations across Japan, the U.S. and the U.K., the company claims, adding that it leads the Japanese market, with 25% of all public companies in the country using its platform.
Success hasn’t tempered the LegalOn’s ambitions, however. The company now wants to further build out AI agent tools to go along with its software, and recently raised $50 million to do just that.
The Series C funding round is being led by Goldman Sachs’ growth equity fund, and saw participation from existing investor World Innovation Lab (WiL). New investors Mori Hamada & Matsumoto (a law firm in Japan), Mizuho Bank, and Shoko Chukin Bank also invested.
The Series C, which brings its total raised to $200 million since its inception, will go toward scaling its agentic AI product development and enhancing go-to-market efforts, accelerating its business in the U.S. and U.K., where its business has quadrupled over the past year. The startup did not disclose its valuation when asked.
Two former corporate lawyers, Nozomu Tsunoda, Group CEO of LegalOn, and Masataka Ogasawara, a board member of LegalOn and CEO of Zelo, co-founded LegalOn in 2017 to address time-consuming tasks before and after contract review, such as organizing legal requests and automating contract management. (Separately, the duo also co-founded a law firm in Tokyo, Zelo.)
LegalOn, which focuses on resolving inefficiencies in the contracting process, now serves more than 7,000 organizations across Japan, the U.S., and the U.K. The eight-year-old startup says it leads the Japanese market, supporting 25% of all public companies in the country.
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Daniel Lewis, Global CEO of LegalOn, said in an interview with TechCrunch that what sets the company apart is its foundation in attorney-drafted, expert legal content, unlike other tools that rely on users to build rules from scratch or use generic AI models that lack the precision required for legal work.
LegalOn’s AI contract review tool, Reviewidentifies risks and suggests edits based on attorney-built playbooks and each enterprise’s legal standards, cutting review time by up to 85% while improving quality and accuracy.
“Our approach ensures contract reviews are aligned with real legal standards, making the output more accurate, consistent, and practical for legal teams. In addition, we have more than 50 attorney-built playbooks, seamless integration into existing workflows, and our solution works out-of-the-box on Day 1,” Lewis said.
Just last week, the startup launched Matter Management—a tool that helps legal teams track contract requests, assign owners, connect matters to relevant people and documents, and collaborate more efficiently with departments such as sales, marketing, HR, and finance.
LegalOn, with over 600 employees, is expanding beyond contract review to launch AI agents supporting legal teams from request to resolution by 2025. It also announced a non-equity tech partnership with OpenAI. The collaboration gives LegalOn access to OpenAI’s advanced models, accelerating product development. “Engineers from both companies are collaborating to develop advanced legal AI agents” that are more adaptable and intuitive for global legal teams.
“It’s a technical collaboration,” Lewis said. “It gives us early access to their latest models, and it positions our engineers to work kind of side by side with engineers from OpenAI. So in that regard, it will advance our goal of like building best-in-class cutting-edge [AI] agents using great technology, but being able to ground that in our proprietary legal content and expertise.”
Legal tech is drawing serious investor interest worldwide. In June, Harvey AI secured $300 million in Series E funding, pushing its valuation to $5 billion. Last year, fellow legal tech firm Clio also raised $300 million, reaching a $3 billion valuation.
While generative AI is rapidly transforming the legal industry, it is not intended to replace lawyers, Lweis said. “The state of the technology isn’t there yet, and replacing lawyers isn’t even our vision,” Lweis said. “Lawyers are still in the driver’s seat. The things AI can’t do perfectly today are, by definition, the things only people can do. And the lawyers who lean into that responsibility—to oversee, to edit, to exercise judgment—are the ones seeing the most extraordinary leverage from AI right now.”
Its previous investors include SoftBank Vision Fund, HSG (formerly known as Sequoia Capital China), Japanese venture capital firm JAFCO and MUFG Bank, among others.
