When times get tough, people get litigious. As the COVID-19 pandemic continues to spread, DISCO Chief Operating Officer Sean Nathaniel said demand for the legaltech startup has grown.
The Austin company announced on Thursday it raised $60 million, bringing the valuation of the company to $785 million. Nathaniel said investment in DISCO validates the legaltech industry as a whole, solidifying the software’s need in government organizations, corporations, tech companies and more — not just law firms.
“We’re positioned well to build the kind of horizontal platform that Salesforce built for sales,” Nathaniel told Built In. “This investment really validates that vision of the legal technology platform that we’re building.”
Founded in 2013, DISCO offers an AI-powered platform that searches documents to identify if they’re relevant to a specific case. Today, approximately 500 customers like Southwest Airlines rely on the startup to automate, organize and speed up their collection of evidence.
Unlike Relativity and other legaltech competitors, Nathaniel said DISCO offers accessible UX and is cloud-native — a particularly important feature as the coronavirus continues to keep lawyers litigating from home, and investing in automation services that help them do more with less.
“The same employees who are now having to work from home have increased workloads,” Nathaniel said. “Technology that is accessible through the cloud performs faster, makes their job easier, automates more steps in the process, and obviously makes it easier for them to meet expectations.”
With the funds, DISCO plans to focus on expanding into Europe, the Middle East, Africa and the Asia Pacific region. The company also aims to develop its AI system to scan contracts and the field of corporate law, which could be areas where it would “acquire or partner” with another company for their tech, Nathaniel said. The startup also plans to refine its AI to further automate the litigation process.
Neil Etheridge, the company’s chief marketing officer, said that DISCO’s AI system currently analyzes documents and makes suggestions about whether an item is relevant to the case. A human lawyer then confirms or denies the AI system’s request. Etheridge said the startup eventually aims to maintain and learn from each recommendation validated and apply its knowledge to future complaints.
“We have designed discovery AI in such a way that its core computability can be applied to other problems in legal technology,” Etheridge told Built In. “As we build new products, we have this AI layer that we can plug into those new products, and leverage for different types of automated classification and identification.”
Over the next 18 months, the 300-person company plans to “aggressively expand” its go-to-market and enterprise sales teams. The latest funding round brings total investment in DISCO to $195 million. Georgian Partners led the financing, with participation from Bessemer Venture Partners, LiveOak Venture Partners, The Stephens Group and Breyer Capital.