Legal AI startup Harvey reaches $15.5 billion valuation in new funding round

By Sara Merken

Sept 9 (Reuters) - Legal software startup Harvey said on Wednesday that it raised $550 million at a $15.5 billion valuation in a funding round co-led by new investors Diffusion and Lightspeed Venture Partners.

Here are the details:

• The San Francisco-based company said the latest round will "accelerate Harvey’s efforts to help law firms, in-house legal teams, and professional services firms build and own their intelligence at scale."

• Harvey develops legal AI tools for law firms and corporate legal departments, helping ​automate legal workflows such as contract analysis, due ​diligence, compliance and litigation. Reuters' parent company Thomson Reuters also sells AI-assisted research tools for the legal industry.

• Existing Harvey investors Sequoia, Kleiner Perkins, a16z, Coatue, Conviction, Elad Gil, Evantic, GIC, Goldman Sachs Alternatives, Verified Capital and WNDR participated in the latest round, in addition to new investors Diffusion, Lightspeed, Sapphire Ventures and Whale Rock, Harvey said.

• Harvey also said on Wednesday that it has acquired San Francisco-based startup Guardrails AI, an AI security platform for agents, in its fourth acquisition this year. Financial terms of the deal were not disclosed.

• Harvey raised $200 million at an $11 billion valuation in March. The company said it is used by 80% of the 100 highest grossing firms ​in the United States.

• Legal tech companies have attracted millions from investors that see the promise in AI to speed up and reshape lawyers’ work. Legora raised $550 million at a $5.55 billion valuation in March and Clio raised $500 million at a $5 billion valuation in November.

• A new venture capital fund with backing from a group of corporate general counsels and law firm ​Wilson Sonsini launched on Tuesday to invest in early-stage legal, regulatory and compliance tech startups.

(Reporting by Sara Merken in New York)