- Legal tech startup Harvey has raised $760 million this year, reaching an $8 billion valuation.
- Harvey has been widely adopted by law firms, and lawyers say it helps them deliver work faster.
- Now the startup needs to prove it can boost law firms' profits.
Legal tech startup Harvey this year has bagged $760 million in funding and soared to a valuation of $8 billion. Now it needs to prove that it can actually boost profits for the law firms that pay for its services.
Harvey, which on Thursday announced the close of a $160 million funding round, says its products free lawyers from drudge work so they can spend more time on strategy and client counseling. But at this point, Harvey's ROI shows up in feelings more than spreadsheets.
Law firms want the payoff to show up on financial reports and client bills, says Zach Abramowitz, a former lawyer turned technology consultant for the legal field. Right now, he says, the payoff "inures first and foremost to the user" — the attorney who suddenly feels like they're working with a supercharged second screen.
AI adoption has skyrocketed across the corporate world. Still, few companies are deriving measurable value from it. According to a Boston Consulting Group survey this year of more than 1,250 global firms, only 5% of companies were seeing real returns on AI.
Investors have thrown $3.2 billion at startups in the legal field this year, according to a Business Insider analysis. Harvey alone has scarfed up nearly one in four of those dollars.
Harvey builds software for analyzing and drafting documents using legally-tuned large language models.
The startup has proven that lawyers want what it's selling. Over half of the hundred highest-grossing law firms in the United States have Harvey licenses. And the startup is quietly making inroads with some of the world's largest enterprises, including Walmart and Comcast.
Every organization is seeking to nail down the value of artificial intelligence, said Winston Weinberg, Harvey's cofounder and chief executive. Time savings, he said, are the "first horizon of measuring ROI."
"The average Harvey customer is saving considerable time by using Harvey regularly," Weinberg told Business Insider in an email. "Longer term, industry-wide, you'll want to see metrics on transformation, profits per partner for firms, and ultimately revenue metrics for in-house teams."
To prove it isn't just selling workplace satisfaction, Harvey recently hired legal-intelligence shop RSGI to run a study of 40 Harvey customers, from A&O Shearman and Paul Weiss to the legal departments of AT&T and National Grid.
Most respondents said Harvey paid off in months, not years, with lawyers churning through work faster. And most said they'd be "upset or disappointed" if the tool vanished. One person joked: "Take away my coffee before my Harvey license."
What eluded firms was a clear way to turn all that enthusiasm into hard metrics.
Only about a fifth of participants — six law firms and two in-house teams — said they had a formal way to track the return on their investment in Harvey tools. Most said they relied on adoption stats and anecdotal "power user" stories to track Harvey's usefulness.
When asked how they measured value, 83% cited internal adoption, 75% intensity of usage, and 58% time savings. Only 18% pointed to cost savings.
One participant shrugged off the question with: "How would you measure the value of Microsoft Word?"
Harvey's customers, at least, seem patient. A third of law firms surveyed said building a formal ROI framework was a lower priority than simply giving lawyers access to Harvey.
Harvey has clearly answered the question: "Do lawyers actually use this?" The open question is whether usage translates into higher profits or just nicer Tuesdays.
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