Sequoia-Backed Crosby Launches AI-Powered Law Firm
▼ Summary
– Crosby, a legal startup, emerged from stealth with a $5.8M seed round led by Sequoia, aiming to transform legal services using AI.
– Unlike typical AI tools for lawyers, Crosby operates as a law firm, employing lawyers who use its proprietary AI to review contracts in under an hour.
– Co-founder Ryan Daniels, a lawyer with startup experience, identified contract negotiations as a growth bottleneck, inspiring Crosby’s AI-driven approach.
– Crosby’s team includes engineers and lawyers, and it has already reviewed over 1,000 contracts for startups like Cursor, Clay, and UnifyGTM.
– Sequoia invested due to the founders’ strong connections and the potential of AI to disrupt the $300B legal industry, particularly in contract negotiations.
The legal industry is undergoing a radical transformation as artificial intelligence reshapes traditional practices. Crosby, a groundbreaking startup backed by Sequoia Capital, has emerged from stealth mode with $5.8 million in seed funding to launch what may be the world’s first AI-powered law firm. Unlike conventional legal tech companies that sell tools to lawyers, Crosby operates as a full-service firm where attorneys leverage proprietary AI to deliver unprecedented efficiency.
At the core of Crosby’s innovation is its ability to review contracts in under an hour, a process that typically takes days or weeks through traditional methods. The company aims to reduce this timeframe to mere minutes as its technology evolves. Co-founder and CTO John Sarihan, formerly of Ramp, assembled a team of engineers to build the AI platform, while CEO Ryan Daniels, a seasoned attorney with startup experience, recruited legal professionals. Together, they’ve created a hybrid model where human expertise guides AI-driven analysis.
Daniels’ firsthand experience as a startup general counsel revealed how contract negotiations often hinder growth. “Legal bottlenecks were literally slowing down our expansion,” he recalls. Crosby addresses this pain point by combining machine learning with attorney oversight to streamline agreements like MSAs, NDAs, and data processing contracts. Since its soft launch in January, the firm has already processed over 1,000 documents for high-growth clients including Cursor, Clay, and UnifyGTM.
Sequoia’s investment signals strong confidence in Crosby’s team and vision. Partners Josephine Chen and Alfred Lin led the funding round, joined by Bain Capital Ventures and prominent angel investors from Ramp, Opendoor, and Instacart. Chen recognized the potential immediately, noting how legal services represent a $300 billion industry ripe for disruption. “Contract negotiations consistently emerge as growth barriers across our portfolio,” she observed, adding that large language models present the perfect solution for this challenge.
What sets Crosby apart is its end-to-end control of both legal services and technology. While competitors focus on piecemeal automation, the firm has rebuilt the entire workflow from the ground up. With 19 employees already onboard, the startup demonstrates how AI can augment, not replace—legal professionals. As Sarihan puts it, “The magic happens when cutting-edge tech meets top-tier legal talent.” This unique approach positions Crosby at the forefront of a movement that could redefine how businesses access legal support in the digital age.
(Source: TechCrunch)
