Kirkland & Ellis has co-developed an AI platform with Palantir to help its private equity clients raise funds from investors as part of a multi-year technology partnership.
The deal with the data analysis, surveillance and AI company − whose technology has been used in the US by immigration authorities to help round up undocumented immigrants − is part of a $500bn plan by the world’s largest law firm by revenue to build its own AI technology.
The ‘fund formation engine’ will be used by more than 1,000 Kirkland lawyers to “securely scale” its institutional knowledge and judgement, streamline complex legal workflows and support fund formation clients and their investors across the entire private equity fundraising lifecycle, it said.
The announcement comes as law firms, which are increasing AI spend in an effort to improve their performance, consider whether to buy or build legal AI.
Law firms have been racing to do the latter, including deals with legaltech companies Harvey and Legora over the past few years. Others, including Clifford Chance and White & Case, are building their own AI platforms in-house.
A&O Shearman has co-developed tools with Microsoft and Harvey, while Freshfields announced a partnership with Anthropic that will see it work with the tech giant to build specialist AI tools that could later be licensed to other law firms through subscription-style models.
Meanwhile, Linklaters has formed a team of lawyers and data scientists to build legal AI tools for its clients.
The data scientists and lawyers will “develop customised AI workflows and tools for clients that an off-the-shelf tool cannot deliver”, Linklaters said.
They will develop AI tools for legal tasks requiring large amounts of data and analysis. Such tasks could include using AI to scan for gaps in a bank’s compliance with regulations and litigation support − for example, evaluating thousands of claim forms to find the strongest cases for a client, the firm said.
In a presentation about the Palantir partnership, Erica Berthou, Kirkland partner and executive committee member, said it decided to co-build its own AI because off-the-shelf AI tools had two main weaknesses: an inability to knit together the “complex moving parts of transaction execution”; and that they are trained on widely available market knowledge which tends to mean that they serve one “common denominator”.
Unlike off-the-shelf legal AI tools, the Kirkland platform is built around the firm’s own knowledge, workflows, tradecraft and judgement, it said.
The platform will support private funds in areas including fund documentation, investor solutions, side letter drafting, obligation tracking, closing commitments and ongoing compliance, Kirkland said.
The technology partnership with Kirkland is “defining what the next generation of professional services will look like”, said Ryan Taylor, Palantir’s chief legal officer.
Berthou told the Financial Times, that Kirkland “spoke to many” tech companies, and while it was “mindful” of recent news reports about Palantir, the tech firm won the mandate because of its data security, track record and talent.
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