UK-founded lawtech companies raised £226.9 million in the first six months of 2026, exceeding the £188.8m invested during the whole of 2025, according to LawtechUK’s latest Investment Snapshot, which is backed by the Ministry of Justice. Scotland was the second-largest recipient by region after London, which accounted for 59.1 per cent of investment.

Wordsmith AI secured £51.95m in Series B funding, placing it among the three largest investments nationally. The company develops AI tools for in-house legal teams, including systems for managing legal requests and contracts.

The report identifies 16 lawtech companies in Scotland, which have attracted almost £96m in investment since 2024.

Across the UK, the number of companies receiving funding fell from 27 in the first half of 2025 to 17 this year, while the average deal size rose from £4.3m to £13.35m. More than 70 per cent of investment went to later-stage businesses, although early-stage funding also increased, reaching £66.6m.

Three companies – Orbital, Wordsmith AI and Lawhive – accounted for around £156m, or 69 per cent of total investment. Their businesses apply AI to specific legal services and processes, including property transactions, in-house legal work and consumer legal services.

The report found growing investor interest in technology that improves existing legal processes, such as document management and transaction execution. Businesses focused on these functions have attracted more than £400m, compared with £92.8m for those focused on generative technology, such as document drafting and content creation.

Christina Blacklaws, chair of LawtechUK, said: “This Snapshot paints the picture of a sector coming of age. We are seeing larger funding rounds, stronger scale-ups, growing regional ecosystems and greater investor confidence in businesses solving real-world legal challenges.”

Sarah Sackman KC MP, minister of state at the MoJ, said the figures reflected the sector’s “continued strength and growing maturity”, adding that the government would continue to support innovation, technology adoption and regional growth through LawtechUK.