UK legal tech investment hits record high

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The UK’s legal technology sector attracted a record £188.8 million in investment last year, representing a 35% jump on the previous year, according to LawtechUK’s second Investment Snapshot.

The report covers the second half of 2025, reflecting the “growing depth and maturity of the UK lawtech ecosystem”. In the second half of the year, 20 UK-based legal technology companies secured £42 million in funding, an average increase of £2.1 million, as reported by Legal Cheek. There were four acquisitions over the period, contributing to 12 deals completed across 2025 as a whole.

Growth was also reflected in the make‑up of the sector itself. The number of UK‑founded businesses rose from 270 in 2024 to 315 by the end of 2025, alongside a notable rise in female‑founded legal technology companies, whose representation increased to 20% in 2025 from 17% in 2024.

Investment from July to December was most heavily concentrated in contracts and document solutions, which accounted for 30% of total funding, followed by risk solutions (25%), knowledge management (15%) and matter management (10%). The report suggests this pattern points to a “clear preference for tools that deliver immediate, measurable operational impact rather than longer-horizon bets.”

Geographically, funding patterns varied across the UK. London dominated in terms of deal volume, accounting for 70% of all funding rounds in the second half of 2025, but represented just 36.7% of total investment value. Meanwhile, Scotland led on regional funding, and there were strong performances in the East of England and the Midlands.

Significant funding activity included a £17.79 million late‑stage venture capital raise for Scotland‑based Encompass, as well as a £5 million seed round for North East‑founded AttiFin AI. Elsewhere, acquisition activity saw software company SmartSearch acquire Welsh risk specialist Credas, while litigation tech company CasePilots was bought by Epiq.

The findings come amid continued government backing for the sector, following a pledge by Justice Secretary David Lammy to provide an additional three years of funding for LawtechUK, which launched in 2019.#