European legaltech startups have raised more capital in 2025 than they did across the entirety of 2024, as investors pile into the sector betting that AI will upend one of the world's most traditional professions. The fundraising pace reflects growing conviction that machine learning can meaningfully cut costs for law firms and in-house legal teams.

Deals are flowing across the continent. Njord, known for its contract management software, has drawn investor attention, and larger legaltech firms are attracting significant capital as the market approaches $297 billion in valuation. A handful of smaller rounds have also closed, with companies like Bryter raising fresh funding to expand product capabilities.

The sector's momentum is driven by AI tooling that promises to automate document review, contract analysis, and compliance checks. Law firms slow to adopt these tools risk losing business to more tech-forward competitors. Investors see the legal space as one of the last holdouts with substantial digitization upside.