Law Firms Build Their Own AI Tools-and Some Are Selling Them
Law firms are increasingly developing AI systems for internal use, then licensing them to clients as a new revenue stream. Sydney-based Inkling Legal Design built a predictive tool that generates contract drafts in plain language and automates document review. Singapore's Allen & Gledhill created A&GEL, a generative AI system that accelerates high-volume tasks while cross-checking work against vetted precedents. Rajah & Tann has already launched a subscription service offering clients access to its AI-powered contract review platform.
The shift reflects a practical problem: existing off-the-shelf AI tools don't always fit how law firms actually work. Inkling's Sara Rayment said most commercial AI products are trained on aggressive US legal documents, making them unsuitable for Asian, Australian, and UK clients. "Because of the way they're weighted, we couldn't get them to work for us," she said.
Allen & Gledhill partner Tham Kok Leong described the same gap in 2024. "If you wanted one suitable for our practice groups and business services, you had to build it yourself," he said.
The Revenue Question
Licensing internal tools to clients opens a potential new business line. But it raises an obvious concern: will clients reduce their reliance on the firm's lawyers?
Rajah & Tann's Rajesh Sreenivasan doesn't think so. The subscription service provides access to the firm's vault of vetted legal documents, but complex issues have an "off-ramp" back to the firm's lawyers. Clients pay a subscription for the system and hourly rates for advisory work. Sreenivasan believes this model actually increases client engagement. "In-house teams may in fact turn to the law firm more often for complex tasks and advisory services," he said.
Ashurst is rethinking its entire business model around AI. Partner Hilary Goodier, who leads the firm's technology-enabled services division, said Ashurst is mapping which tasks AI can replace and developing billing models that charge for both technology and human expertise. The firm has shifted from treating technology as an add-on to making AI central to service delivery.
"Usually the people and the process are at the core, and we fit the technology in along the way," Goodier said. "But we're putting AI at the core of the service and building the process and the people around that."
Still Early Days
Most firms remain in early stages. Goodier said the legal industry as a whole "is still very much at the beginning of this journey." Law firms are using AI for routine work like document review and contracting, as well as complex tasks such as developing litigation strategies.
The pace of change is accelerating. "We've seen more advancements in technology in the past two years than in the past 20," Goodier said. Some firms have been building internal AI for a year or two, but they remain the minority.
For firms considering this path, the immediate benefit is clear: automating routine work frees lawyers for higher-value tasks. Whether licensing those tools becomes a significant revenue source depends on how clients adopt them-and whether firms can structure pricing to capture value without losing billable hours.
Learn more: AI for Legal professionals, or explore the AI Learning Path for Paralegals to understand how these tools integrate into legal workflows.
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