Columbia Grads Create ‘August’ to Bring AI to Midsize Legal …

AI tools are changing the way legal work gets done, whether it’s reviewing contracts or handling research across multiple jurisdictions. Yet, so far, most of these technologies have been built for large law firms with deep pockets, thereby leaving midsize firms out in the cold.

That is exactly the gap August, an AI platform for midsize law firms, is trying to close. The company has raised $7 million in a seed round led by NEA and Pear VC, with additional backing from Afore Capital, leading law schools and angel investors including Gokul Rajaram, Ramp CPO Geoff Charles, OpenAI head of engineering David Azose and Bain Capital Ventures partner Kevin Zhang.

The company said the funding will go towards expanding August’s modular AI agent platform and personalised onboarding model, which adapts to each firm’s unique workflows and legal requirements.

“August gives midsize law firms the freedom to shape AI around their own playbooks, whether they’re advising clients in Miami, Sydney or Mumbai,” said co-founder and CEO Rutvik Rau in a statement. 

Founding Journey 

In an exclusive interview with AIM, Sidhant Raghuvanshi, a lawyer and member of the founding team, shared that the funding round valued August at $28 million. 

Raghuvanshi added that in 2023, three friends from Columbia University—Rau, Thomas Bueler-Faudree, and Joseph Parker—noticed midsize law firms were being overlooked in the legal AI space. 

They met at Columbia’s machine learning research lab, bringing experience from midsize law firms, Blackstone’s data science team and tech companies like DoorDash and PayPal.

Three of them found out that the largest law firms could afford custom-built software and AI tools. Still, there was an entire tier of firms relying on manual, document-heavy processes.

Competitors and USP 

The company is headquartered in New York and is currently expanding its presence in London and India. “We’re onboarding a bunch of law firms here (London), and the same in India,” Raghuvanshi said. The company also has clients in Egypt, Australia, Singapore and the US.

August offers three main functions, including analysis of legal and other documents, legal research across jurisdictions and drafting services. 

Hicksons Lawyers, an Australian firm, reported reviewing 5,000 negligence files 90% faster, while Indian tax firm ELP cut diligence time by 60% using August. A Florida litigation team used the platform to review 40,000 pages in a $100 million dispute, which the company said reduced costs and freed partner time.

“We conducted a process to find the best option, and we chose August because they had the most accurate platform and were the most willing to work with us to solve our specific challenges,” said David Fischl, partner at Hicksons.

Raghuvanshi noted that the company’s main competitors are global players Harvey and Legora. The key difference, he highlighted, is that August focuses on offering customisation for each client rather than a single standardised product. 

“We want to serve mid-sized law firms to help them grow and compete with the bigger firms. That’s the narrative we have within the company,” he said.

He explained that August’s USP is that they offer customisations to every client. “If a law firm’s M&A team and taxation team have different styles of formatting or research, our system adapts to those styles,” Raghuvanshi said.

Hallucinations and Accuracy 

Raghuvanshi revealed that August is model-agnostic. The platform relies on multiple AI models, including Gemini, ChatGPT and Anthropic’s Claude, with custom agents built on top, selecting the best response from different models for each query.

Raghuvanshi said August offers three main capabilities. The first is document analysis, allowing users to query across large sets of files. “You can upload, say, 15,000 legal documents or Excel sheets…and then query over them,” he explained. The second aspect involves legal research, spanning jurisdictions such as India, the UK, Australia and the US. 

The third is drafting, where a lawyer can upload a precedent contract and add new terms. “Our system will be able to give a first draft of the new contract,” he said.

Regarding hallucinations, Raghuvanshi explained that the model always generates responses from the document that has been uploaded. “It goes a few steps beyond RAG because it’s also querying different models at the same time…The models also query against each other to correct themselves,” Raghuvanshi explained. 

He added that the main return on investment for clients has been saving time, which in turn allows lawyers to take on more work. He cited a recent example from a US law firm that needed to prepare deposition questions but lacked the time. The team uploaded about 17,000 emails and nearly 10,000 documents to August’s platform, which analysed the material and generated a list of questions three days before the deposition. 

AI Chats and Legal Protection

Sam Altman, CEO of OpenAI, recently warned users about sharing sensitive information with ChatGPT, noting that conversations with the AI do not have legal confidentiality protections like those with doctors, lawyers or therapists.

When asked about legal protections for chats held with AI, Raghuvanshi pointed out that regulation is necessary. “This space definitely needs a lot of regulation in place. Different jurisdictions will adopt different policies,” he said, pointing to the EU AI Act as an example.

While electronic communication, such as WhatsApp messages, has been admitted as evidence in court, Raghuvanshi noted it is unclear whether AI chats should be treated the same way. “Personally, I don’t think it should be allowed, but I’m sure regulators will come up with a much better policy,” he said.

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