From Innovation to Investment: LawtechUK’s Ecosystem Tracker Maps the UK’s Legal Tech Success Story 

The UK’s lawtech sector is booming, with £1.7 billion raised to date – £139.6 million of that in 2024 alone, an increase of nearly 10% on the previous year. The latest LawtechUK Ecosystem Tracker Report, which records investment and innovation across the UK legal tech landscape, reveals a sector poised for even greater expansion in 2025.  Government-funded programmes are supporting innovation and accelerating growth in the UK’s thriving legal sector. In 2024, one-third of UK lawtechs that secured £139.6 million in funding were supported by a LawtechUK programme, contributing £41.66 million. Nearly 10% of these companies also expanded their teams. 

In the report’s foreword, Sarah Sackman KC MP, Minister of State, Ministry of Justice, commended these efforts, stating, “I would like to thank LawtechUK for their ongoing development and research into this Ecosystem Tracker, which helps us achieve greater understanding of the lawtech sector to support connections between investors, law firms and businesses.” 

AI-fuelled innovation is increasing valuations 

Driven by digital transformation and new developments in technology, most significantly, generative artificial intelligence (GenAI), 2024 saw a surge in M&A activity, with more UK legal tech companies being acquired for higher valuations by major domestic and international firms.  

Additionally, US-based VCs are increasingly acknowledging the UK investment potential. In November 2024, US lawtech giant Litera announced its acquisition of UK-based mass editing and document-generation platform Office & Dragons. The US Accelerator Y Combinator has also seen a rise in legal tech startups in its recent cohorts, and just recently, three legal techs, including Harvey, which now has offices in the UK, announced more than $450 million in funding to develop AI tools to make lawyers more productive.  

2024: A strong year for growth 

In a year of strong growth, fueled partly by GenAI innovation, the legal sector has witnessed firsthand how technology boosts efficiency, expands access to justice, and unlocks new opportunities for alternative legal service providers.  “What this timely report underscores is the huge potential for economic growth enabled through the sector,” comments Christina Blacklaws, Chair of the LawtechUK Advisory Panel. “The government has shown its commitment to driving technological growth in the AI Opportunities Action Plan, and tech can play a significant role in this. With growth last year of over 10% and a total investment of over £1.7 billion already, lawtech is poised to grow at scale in 2025. I’m proud to say that LawtechUK has been instrumental in supporting this rocket-powered growth in the sector, with over one-third of investment raised in 2024 by lawtechs who have participated in one of our programmes. And 2025 looks set to be an exciting and transformative year for lawtech in the UK!” .

Key takeaways:  

• Strong long-term growth in investment – The Ecosystem Tracker reveals the rapid rise of UK lawtechs since 1990, with 270 companies securing £1.7 billion in investment. This dynamic sector continues to attract investment, reinforcing its momentum and future potential. 
• Recent surge in investment activity – In 2024, UK lawtech investment surged to £139.6 million, a 10% increase from the previous year. LawtechUK played a key role, with over one-third (£41.66 million) of this funding raised by companies in its programmes. 
• Expanding focus areas – In 2024, lawtech moved beyond routine tasks to tackle bigger business priorities. Documents & Contracts led with 35% of deals, while Risk surged to 21%, spotlighting the growing demand for compliance solutions in 2025. 
• Shifting investor perception – Lawtech has gone mainstream. Once seen as a niche market, it’s now a prime target for global investors, with M&A activity and increased valuations proving its staying power.  
• Maximising regional growth – Programmes like LawtechUK have played a vital role in driving innovation beyond London by supporting local hubs and fostering regional partnerships. This effort is critical because only six of the UK’s 65 lawtech incubators and accelerators are based outside London, highlighting the need for expanded regional support and initiatives.  
  

A broadening remit 

The allocation of funds across business classifications in 2024 shows that B2B models dominate the lawtech space. However, growth was also experienced in the B2C segment, which in 2024 represented 14% of the total funding across the sector. This reflects the growing interest in using technology to improve access to legal services (A2L) and technological developments, particularly AI/GenAI and mobile apps, creating more potential for viable A2L solutions.  

The most popular area of work is still Documents & Contracts, which account for 35% of all investment deals and secured almost £20 million in investment in 2024. The number of companies operating in the Documents & Contracts space nearly doubled in 2023-2024, indicating a surge in activity and innovation. 2024 also saw significant interest in Risks and People & Resources, which account for 21% of investment deals, providing further evidence of diversification within the UK legal tech ecosystem. 

Challenges and next steps 

While law firms are receptive to new technologies, with 28 of the top 50 UK law firms piloting GenAI solutions², there are still challenges around validating output and managing data protection and compliance obligations. 2025 will be about encouraging firms to create agile tools that solve real problems and can quickly adapt to new developments – products that investors are most interested in.  

Other challenges include regional disparities and accessibility imbalance, and a key objective is ensuring that legal tech benefits are broadly distributed across different demographics and regions. This calls for more networking and matchmaking events for founders and investors across the UK to help startups scale, form strategic partnerships and engage early-stage investors. 

LawtechUK’s efforts to map and support the ecosystem across all regions of the UK provide invaluable data for stakeholders, fostering collaborations that push the boundaries of what is possible in legal services. The report provides a concise market overview of the legal tech landscape and highlights key growth whilst presenting annual growth metrics and high-level investment figures. It also maps funding trends and investor engagement patterns, underscoring the importance of the continued investment and regulatory support required to strengthen the UK’s position as a global leader in lawtech.  

Report methodology:  

The LawtechUK Ecosystem Tracker was first launched in April 2024. The updated dataset of 376 active companies was analysed using multiple data sources, primarily PitchBook, Crunchbase, and Beauhurst. New lawtech ventures were verified through direct requests to LawtechUK or active notifications from these sources. LawtechUK conducted a comparative analysis of the Ecosystem Tracker dataset, uncovering insights into the types of ventures that have successfully raised funds and attracted investment.

The full report with can be viewed via this link.