The legal tech industry continues to evolve at an accelerated pace. VC funding for legal tech companies in 2023 was a staggering $8.6 billion, more than double the $3.2 billion that was invested in 2022. The number of legal tech providers increased by 20%, and the number of legal tech users increased by 15%. This growth was driven by the increasing demand for AI-powered solutions in the legal industry, the growing number of legal tech providers, and the rising adoption of legal tech by law firms and legal departments.[1]
Five Predictions for 2024 in the legal tech world are fascinating and diverse, coming from various experts in the field:
Generative AI in Litigation will aid in developing litigation strategies. This will include creating legal briefs and motions more quickly, identifying weaknesses in the other side's case, anticipating potential arguments from the other side, developing a better understanding of the facts of the case and identifying potential settlement opportunities. [2]
Blockchain Integration for Contracts and IP will become more prevalent in contract management and intellectual property. This will include creating smart contracts that can automatically execute when certain conditions are met, tracking the ownership of IP assets, preventing fraud and counterfeiting and ensuring compliance with legal requirements. [3]
Development of AI Ethics Guidelines for AI in law will become a focus. [4]Â The EU AI Act will have a profound impact on the development, deployment, and use of AI in the legal industry across Europe. The Act will encourage companies to invest in developing AI systems that are ethical, transparent, and accountable.
AI-Driven Legal Analytics Expansion will be used more broadly for legal analytics and predictive modelling. AI-driven legal analytics are capable of extracting insights from vast amounts of legal data to support decision-making and improve legal outcomes. [5]
There will be a shift from the general hype around generative AI to specific use cases in legal tech. In its early stages, generative AI was often met with unrealistic expectations. Some proponents touted it as a revolutionary tool that would revolutionize the legal industry, claiming it could automate legal tasks and even replace lawyers altogether. However, as generative AI has evolved, the legal community has begun to adopt a more measured approach. Rather than relying on grandiose claims, legal professionals are now focusing on identifying specific areas where generative AI can provide real value. [6]
The future of legal tech in 2024 is promising, with AI tools becoming more sophisticated and integrated into various legal processes. AI will play an increasingly important role in document review and drafting. Legal operations platforms will continue to gain traction, helping law firms and legal departments to improve efficiency and productivity. New tools for data analytics and decision-making will emerge, enabling lawyers to make better-informed decisions.
The increasing sophistication of AI in legal tech will inevitably transform the daily work of legal professionals. This shift will likely necessitate new skills and training, particularly in AI literacy and data management, to ensure that legal professionals can fully leverage these evolving tools.
As we look towards the future of legal tech in 2024, it's crucial to remember that AI is an augmentation tool, not a replacement for the nuanced expertise of legal professionals. By balancing technology with human judgment and creativity, AI can enhance the efficiency and quality of legal services, allowing lawyers to concentrate on higher-value, strategic aspects of their work.
Sources:
[2] Legal Tech Trends 2024 Report, https://www.uslegalsupport.com/blog/survey-results-predict-top-legal-technology-trends-for-2024
[3] Global Legal Tech Report https://www.globallegaltechreport.com/
[4] American Bar Association
[5] Â LexisNexis+AI
[6] Â Â 2024 Legal Tech Trends Report, Henchman https://henchman.io/legal-tech-trends-2024