The legal industry can no longer dismiss AI to postpone change.
Today, generative AI systems can handle complex legal data with a level of speed and precision that would have seemed unrealistic only months ago.
In the United States, some law firms are rebuilding their business models from the ground up.
Recently, I spoke with Jen Berrent, co-founder of Covenant.co, a New York-based AI-powered firm which moved beyond hourly rates and recently completed a $5M fundraising round led by Flybridge Capital Partners, to develop their own data management cloud platform.
The GCC and AI-Powered Law
As this shift accelerates globally, the GCC is uniquely positioned to become the next frontier for AI-powered lawyers.
Covenant.co fits into a broader mega trend. A new generation of specialised start-ups offer tech solutions, aiming to conquer a market valued at around $1T in the U.S. alone.
Among the front-runners, Harvey has reached a $8B valuation, whilst Legora stands at $1.8B. These companies provide AI technology to lawyers, rather than legal advice, and many traditional law firms are adopting their solutions to retrofit their back-office operations.
Covenant.co, however, wants to go further, re-engineering the traditional legal business model, moving away from billable hours by design, and focusing on customer experience.
Jen Berrent is no ordinary lawyer, she is the former Chief Operating Officer and General Counsel of WeWork and a former partner at the Big Law firm WilmerHale. Alongside her co-founder Richard Perry, former General Counsel of CVC Capital Partners, they saw a break-through opportunity to accelerate deal-making in private markets following an OpenAI GPT upgrade in 2023.
She explained that Covenant deploys multiple generative AI models in parallel to safely complete the contract review in minutes and integrates verified data quality-assurance with human lawyers. “The facts are always correct” Jen explained; “Any additional commentary is clearly marked as AI-generated, and it is not charged to the client”.
Covenant and Cloud
Covenant engineers also developed a dedicated cloud-based platform, to meet clients’ demand for direct access to their own portfolio data, without the lawyers acting as gatekeepers. The platform provides data insights and analytics through an AI interface, free of charge.
At its core, generative AI represents once in a lifetime opportunity to drive growth in legal services. It is transforming legal services into a data logistics business: it allows for faster and safer handling of legal information, equipping human lawyers with better analytical tools, fostering collaboration between legal, finance, and business teams so they can focus on what truly matters: making sound business decisions.
It allows productivity to scale both in law firms and in-house teams.
Potential for AI Legal Services in the GCC
Today, Covenant.co serves sovereign wealth funds, family offices, and other global institutional investors, totalling $3T of assets under management. Some of those investors are based in the GCC, which shows that the region has all the ingredients to grow the size of AI-powered legal services offered locally.
First, consider the end-users base. The GCC is home to large sovereign wealth funds, family offices, and institutional investors that value innovation and cost discipline. The Middle East legal services market currently stands at $32.8B, and it is projected to almost double by 2033. Saudi Arabia and UAE account for almost half of the market.
Second, the region’s digital infrastructure is world-class. In KSA alone, electronic payments have reached 80% of retail transactions, well ahead of the USA (ca 65%) and Europe (ca 50%). In the GCC digital transformation is not a slogan, it being executed at scale.
Third, demographics matter. The GCC has one of the youngest populations globally, with a median age of just 32 years old. This is a generation that expects innovation, and understands technology intuitively.
Ultimately, the lesson from New York is clear: AI has begun to crack the billable-hours model, reposition legal services as a data logistics business, and placed customer experience at the centre. The GCC may well be the next frontier for a new model of legal services, adopting AI safely, efficiently, and at scale.
As the song goes: “New York, if you can make it there, you can make it anywhere”.
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