How to Succeed in the Hype Cycle of Legal Tech
Legal Tech’s Big Moment Is Here—But Are You Ready for the Hype Cycle?
Legal tech is booming. Thanks to generative AI, an industry built on text is now transforming at lightning speed. For lawyers, this shift brings both opportunity and anxiety.
Generative AI is changing how legal work gets done. Tasks that once demanded high hourly rates—like drafting, reviewing, and researching—are being automated. What used to take hours now takes minutes. It’s like giving every associate a jetpack. Exciting? Yes. But also disruptive.
In 2024 alone, legal tech startups raised over $2.2 billion globally. That kind of funding signals a red-hot market. But it also places many founders squarely in the hype cycle—where expectations skyrocket, competition explodes, and pressure mounts.
From Education to Urgency: The Shift in Legal AI
Just a few years ago, selling legal tech meant starting with the basics. Many law firms didn’t even know what legal tech was. Startups had to explain every feature and benefit, often facing skepticism and long sales cycles—sometimes up to two years.
Now in 2025, that’s changed. One strong demo can close a deal. Law firm leaders no longer ask, “What is AI?” Instead, they’re saying, “We needed AI yesterday.”
The legal industry—long resistant to change—is suddenly all-in. This rapid shift has pushed legal tech deeper into the hype cycle, where innovation moves fast, and staying relevant is a daily challenge.
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Expect Imitation and Intensity During the Hype Cycle
In the heat of the hype cycle, competitors pop up everywhere. From big law incumbents to tiny startups with similar products, the field gets crowded fast. Expect a nonstop stream of product launches, funding rounds, and bold marketing.
The barrier to entry is low. Anyone can build a tool on top of a large language model with a clean user interface. This flood of new players makes it hard to stand out.
How to Stay Focused and Win in the Hype Cycle
The secret? Focus on speed and adaptability.
Say “yes” more than you say “wait.” Be open to imperfect customers and real-world messiness. You don’t need a five-year plan—you need to make smart one-year bets.
In fast-moving industries like legal tech, progress often means launching before you’re fully ready. As one investor put it: either move fast and take risks, or wait too long and get left behind.
After seven years building in this space, I’ve seen legal tech go from ignored to essential. What started with a slide explaining “What is Legal Tech?” has turned into a movement reshaping million-dollar law firms.
Keep Perspective as the Hype Cycle Peaks
It’s easy to get caught up in the excitement—but don’t lose your perspective. Talk regularly with experienced advisors who’ve seen hype cycles rise and fall. Your board should help you stay grounded, not add to the noise.
Most importantly, be thankful. You’ve caught a powerful wave. Right now, doors are open that are usually locked. Use this moment to build something meaningful—something that lasts after the hype fades.