Are AI First Firms the Next Legal Unicorns or Just Trendy Marketing Speak?
Plus episode 53 with Manifest OS Founder Dan Mishin
While everyone loses their minds about whether Harvey and Legora are overvalued, an AI-first firm quietly notched a $750M valuation in its very first financing. Where’s the outrage!?
Hey there, I’m Zach Abramowitz and I am Legally Disrupted!
And I’m not quite outraged by AI-first firms, but I’m starting to sense that others have had enough. But, if you’d like to learn about the aforementioned AI first firm that just got valued at $750M, allow me to present to you Episode 53 of Zach Abramowitz is Legally Disrupted with Manifest OS founder Dan Mishin.
I learned about Manifest about six weeks ago when they announced their first round of financing ($60M) from Kleiner Perkins, Menlo Ventures, Quiet Capital and First Round Capital that valued the AI first corporate immigration firm at $750M. As Dan tells me on the podcast, that round came together in 48 hours and there was no pitch deck. There are a lot of takeaways in this conversation for people who are thinking about building or investing in AI first firms. The blueprint seems to be:
Find a niche where there is high volume process driven work
Automate as much of the admin and legal workflow as possible
Empower attorneys to give greater attention to clients and the work that relies more on human judgement
Now, while there are a lot of very savvy investors, attorneys and clients who are very enthusiastic about AI infused service businesses, not everyone is as jazzed about this model.
I think there are good answers to Mitch’s question. For one, there are many examples of highly successful companies that simply took two things that were now economically feasible and combined them to make a new even better thing.
But, the reaction itself is a data point: the market may be growing a bit tired of the AI first firm marketing talk. About a month ago, Crosby founder Ryan Daniels (who I like btw) was appropriately roasted on X for positioning the AI first firm as some lofty, socially conscious, mission-driven company.
Matt wasn’t the only one.
Oh, and if AI firsters claiming to be “mission driven” bothers you, prepare yourself to be triggered because Dan talks a lot about mission. Check out the following clip from our interview.
And more recently, I’m noticing more backlash to the term “AI first.” ChatGPT even mentioned to me recently that it’s lost all meaning because everyone is using it.
My take: I would argue the term “AI-first” (or its cousin native) was quite useful for introducing a new category of firms built from the ground up with the understanding that (1) AI exists and (2) because AI exists you wouldn’t build the same kind of firm today that you might have built five years ago. And I, myself, remain bullish on the opportunity to build a new kind of firm, but I get the cynicism. I also don’t quite understand why everyone of these firms needs to raise capital. If the AI is here, why not just start?
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