LinkSquares, a Boston-based provider of AI-powered legal contract analytics, raised $2.16 million in a seed funding round, the company announced Tuesday. Leading investors Lawrence Field and Charlie Stephenson from Regent Private Capital, a Tulsa, Oklahoma-based private equity and VC investment firm, contributed $1 million.
Boston-based angels Rob May (current founder and CEO of Talla and former founder of Backupify, where the LinkSquares co-founders met), Dave Balter, Ari Buchler, Phil Beauregard, Steve McKenzie, Jere Doyle and Sam Clemens participated in the round.
Based on Chauncy Street with a team of 12 full-time employees, LinkSquares hopes to substitute the manual review of contracts with its software, which can extract core information (such as auto-renew date, effective date, the counterpart's names) from pages and pages thanks to its machine learning and artificial intelligence algorithms.
Co-founders Vishal Sunak and Chris Combs met while working at Backupify, the Cambridge-based startup founded by May and acquired by Datto in late 2014.
Witnessing the process of being acquired played a huge role in the origins of LinkSquares, Sunak said, as he and Combs noticed firsthand the number of legal projects that were around the executed agreements. Imagine one of the tasks: a pile of paperwork (Backupify's vendor agreements) in need to be closely reviewed, modified and scrutinized in light of the imminent acquisition deal.
"We quickly realized that there weren't tools that we could use to help us with these projects," Sunak said in a recent interview. "That is where the idea for the business came from."
The year after Backupify was acquired, Sunak and Combs launched their own software company targeting corporate legal and finance teams. Currently, Sunak said that the company serves over 50 customers in the U.S., with over 10 of them (DraftKings, Carbonite and CloudHealth Technologies, to name a few) based in the greater Boston area.
As for the revenue, Sunak added that the company is "quickly approaching" $1 million, with 100,000 contracts uploaded on its platform; the company bills customers according to the number of docs, which is in the order of thousands.
The seed round will be used to continue to grow sales and invest in the company's technology according to customers' feedback. A big focus in developing the software will be extracting more information and integrating the data with other systems, like CRMs, relational databases and business intelligence tools. Currently, the software works with several types of contracts, including non-disclosure agreements, software subscription agreements and invoices.
"By this time next year, we'll probably double the full-time count in Boston," Sunak said, which would mean reaching a total of around 24 employees.
