Ivo AI raises $55M to scale contract intelligence for legal teams – News

Legal artificial intelligence technology startup Ivo AI Inc. said today it has closed on a $55 million funding round as it looks to accelerate the development of its platform and expand its product and engineering teams.

The Series B round, which values the company at $355 million, was first reported by Forbes. It was led by existing investor Blackbird and saw participation from new investors including Costanoa Ventures, Fika Ventures, Uncork Capital, GD1 and Icehouse Ventures.

The company caters to the growing demand for tools that can automate much of the grunt work performed by law firms on behalf of large corporations, driving investor interest in the AI legal technology segment. In December, another legal AI tech startup called Harvey AI Inc. raised $160 million in a deal valuing it at $8 billion.

Ivo’s valuation remains quite a bit lower than Harvey’s, but it has a diverse customer base that includes enterprise technology giants such as Uber Technologies Inc., Reddit Inc., IBM Corp., Shopify Inc. and Canva Pty Ltd. The startup’s software is primarily focused on automated contract reviews, enabling companies to speed up this process by reducing the need for humans to do it manually. Its flagship tool integrates with Microsoft Word, which is widely used by lawyers for drafting and negotiating contracts.

More recently, Ivo has expanded its capabilities to include contract intelligence. It can analyze agreements to obtain insights from them, so legal teams can understand how their risk profiles and negotiating positions have changed. It also helps legal teams to understand contractual obligations, relationships across contracts and identify deviations from standard legal terms.

Ivo co-founder and Chief Executive Min-Kyu Jung (pictured, left, with co-founder Jacob Duligall) told Reuters in an interview that the company has seen demand for its tools shift from large volumes of simple contracts to more complicated ones. “Increasingly, the trend has been for more complex agreements,” he said.

The startup is well aware of the risks of using AI in the legal industry. In recent years, there have been a number of reports of AI making major errors, for instance by generating fake citations. In 2024, a Virginia judge ordered lawyers in a lawsuit to explain why he should not sanction them after they submitted a filing that included “fictitious” AI-generated cases as a supposed legal precedent. The judge ultimately opted not to sanction the attorney in question, but emphasized that it’s their responsibility to check the accuracy of any filings they submit with the assistance of AI tools.

Jung insisted that Ivo avoids these errors because it breaks down contract reviews into more than 400 separate tasks, with each one being performed by AI agents that specialize in a particular function. He said it’s a more detailed methodology that leads to more accurate and defensible results than standard generative AI chatbots. Jung added that this is necessary, because lawyers are among the most skeptical and discerning customers, whose trust can only be earned through real-world performance, not marketing.

This level of accuracy has helped Ivo, which was founded in New Zealand but is now headquartered in San Francisco, to grow its annual recurring revenue by more than five times since its last funding round in February. Over the last year, it has more than doubled its customer base, Jung said.

Looking forward, Ivo said it will use the funds from today’s round to accelerate its product development and triple the size of its 60-person team by the end of the year.

Photo: Ivo AI