There’s a lot of attention being paid to how artificial intelligence technology will potentially replace many low-paid, low-level, unskilled jobs like retail clerks, customer service agents and factory workers. But now a startup is taking aim at a different kind of industry – one with highly skilled, highly paid professionals: law firms.
San Francisco-based Atrium has just raised $65m from a few very well-known venture capital firms such as Andreessen Horowitz, Ashton Kutcher’s Sound Ventures, General Catalyst and Greylock Partners, and recently welcomed Marc Andreessen as a board observer.
So why all the fuss about a company that just opened its doors only 14 months ago? It’s because Atrium is doing something that hasn’t yet been done: use artificial intelligence to completely disrupt the legal industry, a disruption that could potentially replace many high-priced lawyers with inexpensive machines.
“I’m pretty stoked about that,” Justin Kan, one of the 110-person company’s founders told TechCrunch (he was referring to the raising of capital). Kan is not new to this game. He was also a founder of the highly successful live-streaming video platform Twitch.
Atrium aims to be a full-service corporate law firm (almost half of its employees are attorneys) that leverages AI technology to do much of the legal work required by growing startups who need help dealing with raising equity, hiring employees or writing up commercial contacts. The company’s software uses machine learning code to understand legal documents and automate repeatable processes.
The value-add for its clients is a reduction in the high hourly fees paid to legal associates who are doing most of this work now and a reallocation of legal expenditure towards more valuable legal advice and insights from a company’s counsel. Because the work is done by software bots, it can be performed in a very fast, and price-predictable (translation: fixed) way. Already, the company says it has “hundreds” of startup clients using its services.
So how is this done?
One of Kan’s first-use cases was a startup that needed to put together capitalization tables for a round of funding. To do this, a highly paid lawyer would need to read through all the documentation and create a complicated spreadsheet.
“It is tedious work and often subject to human error – this isn’t a skill they teach in law school,” Kan said in an interview with Above The Law. “But from a programmer’s perspective, these are documents with similar structure, over and over. So we built a model that takes in these convertible securities, then make a schema for the data expected in these docs.”
Does this mean the end of attorneys? Not at all. AI will never fully replace people, particularly highly skilled people. But it can be used to automate routine tasks. Technology firms like Atrium are using AI-based software to complement and enhance a service that’s already being provided by humans, which can be easily duplicated by a machine.
“We’re always, always about humans + software,” Kans said.
