There were a couple of things I used to do in practice, where I remember thinking: Why is this happening? 

Elena Tsalanidis and Justin Hansky are the co-founders of Deeligence.

Deeligence is a fast-growing legal tech startup that raised $1 million in its latest round to streamline due diligence with AI. 

After hundreds of customer interviews, a brutal raising round and a major rebrand, Elena and Justin are helping lawyers move from grunt work to strategic thinking — and they’re just getting started.

We sat down with Elena and Justin to talk pivoting to AI, fundraising realities, the billable hour, and why not every lawyer makes a great founder.

Elena: Deeligence is an AI-powered collaboration platform for due diligence. We bring all lawyers working on a DD — from corporate teams to specialist teams — onto one platform. We move them from the data room to a client-ready report, faster and more accurately.

We’re solving for an extremely tedious and laborious part of a transaction. It’s what most junior lawyers call: “the biggest nightmare of their practice.” 

What we do is bite off the non-legal, non-strategic work so lawyers can focus on the highly strategic questions that warrant their in-depth analysis. 

And we’re an AI Company now, too — we capture the legal work done in reviewing contracts for the first time.

Elena: Funnily enough, we wrote in our original business plan: “We don’t think AI is there yet. We’re not an AI company, we’re a process-first company.” 

We have to eat our words now because we’re totally an AI company, but that speaks to how far AI has come since we began. 

But when we started, we were building a project management and collaboration tool. We then quickly realised that, instead of ensuring the lawyers work more effectively, we can now help them bite off the legal work that they're doing. 

We knew implementing AI into our pre-existing platform was the right move – it was the logical next step. So that's what we did. First and foremost, we drastically improve the due diligence process, and the AI is really layered in. 

Justin: There were a couple of things I used to do in practice, where I remember thinking: Why is this happening? 

One was sitting there with two spreadsheets open and a ruler, trying to work out what had changed in a data room, which is objectively nuts. 

The other was reading contracts back-to-back.

You’re at your desk. It’s 1:00 am. You can barely think anymore. 

I kept wondering: How is this the way we’re still doing things?

I put that at the back of my mind for a while — worked in a few different roles, including legal tech. But once the technology caught up, we realised we could cut review time by about 70%. 

It became a matter of timing, really.

Elena: We also both started in commercial law firms, and then separately went into legal tech. 

Justin did his MBA and worked at a European legal tech company. I was at a UK-based one.  

Throughout all this, we kept hearing about diligence. 

So when we were back in Australia, we started interviewing lawyers. We talked to hundreds of people at all levels and in multiple jurisdictions, trying to understand the pain points of the diligence process. 

Then, we started mapping out the process, building Miro boards, and tinkering with a potential solution that would solve most people’s problems. 

We both found it very hard to transition away from law. Once you've done a year or two of being a lawyer, you can get pigeonholed as being a lawyer forever. 

Still, even in our hiring practices, we’re obsessed with lawyers. We love to hire them. We think that they can do anything. 

But I will caveat that by saying I think it's a specific type of lawyer that can do everything. There are those black letter, super risk-averse types — let me check everything until it’s perfect. Those people don't do super well at a startup because speed matters more than perfection. 

You’ve got to be okay with risk and ambiguity.

I saw with some of my colleagues that some people struggled with uncertainty or weren't willing to take big risks. And those that were, had better startup fit. 

Justin: Yeah, my journey was similar but also a bit different. 

Even before I started as a lawyer, I knew I wanted to run my own business – that was my goal. I just didn’t know how I was going to get there. 

After I had spent enough time in a practice group, I started to find it a little less interesting.

I tried a few different things, but ultimately went down the MBA route. There, you have the time to figure out what you want to do next, what suits you, your skill set, and your personality. 

I learnt I wanted to be in fast-growth startups, which took me into legal tech. That’s when it started to click.  

Elena: We also both had startup experience, which was instrumental in making us great founders because we had worked for someone else on their vision. In Justin’s case, it involved building and scaling a team. In my case, it was working cross-functionally and getting a new product into lawyers’ hands. 

Those experiences were incredibly enriching. Being a lawyer plus working at startups for both of us is absolutely a competitive edge. 

Elena: Many general-purpose AI tools out there promise to do it all. 

We don’t. 

We just do due diligence. And because of that, we deliver on our promise. Our product is squarely focused on due diligence and trained on Australian documents. You look at other products that may work super well in the US or UK, but lawyers here tell us: “They’re a bit unreliable.” Deeligence is reliable. 

Justin: And the real question firms should ask — whether it’s a general or specific tool — is: How do you know it’s doing a good job? 

We know, because we’ve built a bank of hundreds of contracts that have been reviewed by top-tier lawyers. That’s our benchmark for what good looks like in diligence. And we constantly check everything our platform produces against that gold standard. So when we put it in a lawyer’s hands, we know it will be reliable.

Elena: What’s amazing about highly intelligent corporate lawyers is that they tell us how we could improve, all the time. 

But that’s actually amazing as a founder. If something isn’t clear or could be more accurate, that feedback shapes our product roadmap. We live off that feedback.

Justin: We’re also building the product we wish we’d had in practice. 

When you’re building for yourself, it’s easy to get a little caught up in how you used to do things. But every firm — and even every partner — works slightly differently. We constantly listen to customers to ensure it works for everyone, not just us.

Justin: We hear two things from our customers on this point. 

First, diligence often works under soft caps. You quote before you’ve seen the data room. So you blow out the quote, take a haircut, and it hurts. Reducing that overrun is obviously very important for firms.

Second, firms manage their fees on diligence by scoping down. Say, we’re only reviewing the top 10 contracts. But contract #11 might inadvertently assign away a bunch of your core IP.  That contract might only be labelled as a ‘$10,000’ contract, but that’s incredibly material to the business. 

What we give is the ability to look beyond a super fixed scope at a much lower cost, so you gain a better sense of what's going on in the business. When you do that, you offer your clients a better service, and they’re willing to pay extra for it.

Elena: Great lawyers get that AI is dislocating the billable hour, especially in diligence.

Whether it’s write-offs, lawyers taking too long on something or just self-editing time. In this specific spot of the law, people are often losing money. They take the hit, hoping that they will win back from more work later on. 

What we’re saying to our customers is — don’t take that hit, don’t leave money on the table. 

Let’s deliver on your scope.

Elena: We knew we wanted to build AI into the platform. But AI engineers don’t come cheap, and great technical talent is expensive. 

We wanted to make sure we had fuel in the tank to deliver something exceptional for our client. 

That was the impetus to close the round.

Justin: It’s a brutal process. 

We got it done in about four months, which sounds like a long time. But relative to what some of our peers have experienced, that’s actually pretty good. That's four months where I’m spending not that much time on the business, basically fundraising full time.

Elena: While I manage the entire business full-time.

It was really hard. 

It's like going through a job application process where you hear a lot of nos until you hear a yes. 

Investors pull apart your business. Sometimes with incredibly helpful feedback. Other times, they might miss the mark or not understand your customers as deeply as you do, which is understandable.

It can be a demoralising process until you get there. But we got there.

Justin: Historically, there's also been a big stigma around legal tech being unable to produce venture-scale outcomes. 

Because if you look at the industry generally, it hasn't produced that many really large companies, except, say, DocuSign and a handful of others. 

It was clear to us that AI's ability to start producing something that looks a lot like legal work was just the beginning. Some VCs were starting to get it. But, for the most part, there wasn’t the strong appetite there is now.

Elena: We have global aspirations. 

We're considering where to go next, with the UK and the US at the top of that list. 

We're engaging with investors with a view to landing in those places very shortly. 

Luckily for us, how lawyers run matters in those jurisdictions, like in London and New York, is a similar process. We’re looking to raise a Seed round in Q3 this year to fuel that global expansion.

Justin: I think the idea of prompt engineers is a little overcooked. The way the technology is moving, there'll be a reduced need for that over time.

What's going to happen is you'll need fewer lawyers for the same amount of work. 

Think about how a piece of work moves through a law firm. 

The junior does the first cut. The senior associate effectively rewrites it. Then the partner tweaks it a little, right? I think that the first cut is likely to be done using technology. 

Judgment, client relationship, client context, industry experience — those human and strategic factors — I think are going to be the things that people need to focus on. 

For juniors, the key skill will be thinking critically about what's coming back from these AI tools. That’s what the role will look like.

This idea of sitting down with a blank piece of paper is no longer the case, especially in the next 12 to 24 months. So, having a different set of skills for juniors coming out of university will be the challenge.

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