McDermott-backed legal tech fund raises $110m for second vehicle

The LegalTech Fund, the US-based early-stage venture fund, has closed a $110 million second fund. The raise is nearly four times the size of its $28.5 million debut in 2021, a standout result in a tough venture market and one of the largest dedicated legal tech funds to date.

McDermott has returned as an anchor investor with a $10 million commitment. E-discovery provider Consilio has also joined as a lead strategic investor, alongside participants including Clio, Docusign, Harbor, Orrick and the venture arm of Thomson Reuters.

Strategic capital from major players

For McDermott, the investment doubles down on a strategy of embedding itself early in legal tech startups. Chairman Ira Coleman said: "We’re committed to driving that disruption, not being disrupted by it."

Consilio’s CEO Andy Macdonald said the company is putting "millions of dollars behind driving innovation across the ecosystem" aiming to build a marketplace where clients can access the best technology.

What the fund is backing

TLTF focuses on early-stage companies up to Series A and has already invested in a wide mix of businesses.

These include UK-based Wexler, the AI platform for litigation teams which closed a $5.3 million seed round in September, Entegrata, which supports legal teams using AI and analytics, Flo Recruit, which modernises law firm hiring, and HelloPrenup, a consumer legal platform that expands access to affordable planning tools.

Other companies in the fund include BlackCloak, SimpleClosure and Intelligent Legal Solutions, which operate across security, automation and legal operations. Together, they reflect how legaltech is expanding from traditional practice support into risk, workflow management and enterprise grade systems.

A red-hot sector

Investors are continuing to bet on a structural shift in the $1 trillion global legal services market, as AI, workflow automation and data led processes continue to reshape the industry.

Law firms and in-house legal teams are under pressure to modernise, reduce friction in service delivery and rethink the balance between high value advisory work and repeatable tasks.

The legal tech sector has seen a wave of high-profile fundraises in recent months. Legal AI platform Legora secured $150 million at a $1.8 billion valuation in October. Knowledge search tool DeepJudge raised $42 million earlier this month, announcing Freshfields as a customer. And contract review platform Spellbook closed a $50 million Series B round, also in October.