{"id":513947,"date":"2026-03-04T15:14:08","date_gmt":"2026-03-04T15:14:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/513947\/"},"modified":"2026-03-04T15:14:08","modified_gmt":"2026-03-04T15:14:08","slug":"spellbook-secures-us40-million-from-rbc-to-snap-up-smaller-legal-ai-startups","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/513947\/","title":{"rendered":"Spellbook secures US$40-million from RBC to snap up smaller legal AI startups"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

Spellbook co-founder and CEO Scott Stevenson. The company has more than 4,000 customers across 80 countries, including Nestl\u00e9, Dropbox, eBay, AtkinsR\u00e9alis and Franklin Templeton.Johnny C.Y. Lam\/The Globe and Mail<\/p>\n

Rapidly growing legal artificial-intelligence<\/a> software startup Spellbook has secured US$40-million in debt financing from Royal Bank of Canada<\/a> to buy smaller competitors that rushed into the hot generative AI market but are now struggling. <\/p>\n

The St. John\u2019s-based company, officially named Dialog Enterprises Inc., launched one of the first generative AI tools for lawyers in 2022. Its AI copilot, powered by large language models (LLMs) including OpenAI\u2019s GPT-5, is used by lawyers and corporations to automatically draft, edit and review legal contracts within Microsoft Word. <\/p>\n

Spellbook tripled its revenue in 2025 and is on track to reach US$100-million in annual recurring revenues by year-end, said chief executive officer and co-founder Scott Stevenson in an interview. The company has more than 4,000 customers across 80 countries, including Nestle SA, Dropbox Inc., eBay Inc., AtkinsR\u00e9alis Group Inc. and Franklin Templeton. <\/p>\n

On Tuesday, Spellbook said it had signed a two-year partnership with the Canadian Bar Association to exclusively provide AI-powered contract drafting and review tools to its network of 40,000 lawyers, judges, notaries and law students. <\/p>\n

Seven tech firms joined Canada\u2019s $100-million club in 2025 \u2013 and 2026 could bring even more<\/a><\/p>\n

The 150-person company is also on a hiring spree and plans to add 100 employees by the end of 2026. <\/p>\n

Spellbook has emerged as a front-runner as the nascent market has rapidly matured. Now dozens of smaller companies that have struggled to gain a foothold have reached out to ask Spellbook to buy them, Mr. Stevenson said.<\/p>\n

As a result, he said Spellbook has tapped Royal Bank\u2019s innovation banking unit RBCx for a line of credit to consolidate some of the smaller players. It is looking to buy revenue-generating companies in Canada and the U.S. that sell contract-related AI software, not for their products but for their customers, which it will move to its own product. It is also looking to make \u201cacqui-hires\u201d whereby Spellbook buys companies for their talent. <\/p>\n

\u201cIt\u2019s a good strategy for us to bolster our team and get to a larger level of maturity quickly so that we can execute on the opportunities in front of us,\u201d he said. <\/p>\n

Thomson Reuters leans on proprietary data in AI race as disruption fears mount<\/a><\/p>\n

Software company valuations have crashed in recent months over concerns that new AI tools could supplant their business. Asked if it was difficult to price acquisitions against that backdrop, Mr. Stevenson said Spellbook plans to pay \u201csignificantly below average\u201d multiples for companies that are just looking \u201cfor an exit door\u201d and to return capital to investors. <\/p>\n

He expects privately held Spellbook to spend up to US$60-million in cash and stock on \u201cfive really thought-out deals\u201d within two years, and it is now looking at two potential acquisitions.<\/p>\n

RBCx head of banking Tony Barkett said in an interview his bank likes Spellbook because \u201cwe understand their strategic focus. If you look at their technology, their growth, their position in the market, their experienced management team and the investors backing them, they are in a good position to succeed. Using this debt to further widen the moat will only make them stronger.\u201d <\/p>\n

The RBC deal follows a US$50-million venture capital financing by Spellbook last year led by Khosla Ventures and backed by Threshold Ventures, Inovia Capital, Bling Capital, Moxxie Ventures, Path Ventures and former Shopify chief technology officer Jean-Michel Lemieux. That deal valued Spellbook at US$350-million including the cash raised. <\/p>\n

Spellbook also counts Thomson Reuters Ventures as an investor. Its parent, legal information giant Thomson Reuters Corporation, has also made acquisitions in the legal AI space and is looking to spend US$11-billion over three years on acquisitions and returning cash to shareholders. The company is controlled by the Thomson family, which separately owns The Globe and Mail. <\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: Spellbook co-founder and CEO Scott Stevenson. The company has more than 4,000 customers…\n","protected":false},"author":2,"featured_media":513948,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[62,901,276,277,888,902,879,877,903,49,48,876,895,896,891,878,875,46,549,295,894,887,914,880,881,893,889,890,884,904,885,909,910,912,907,911,905,908,882,898,899,714,897,906,865,61,900,892,886,883,913],"class_list":["post-513947","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-ai","tag-alberta","tag-artificial-intelligence","tag-artificialintelligence","tag-arts-news","tag-bc","tag-breaking-news","tag-breaking-news-video","tag-british-columbia","tag-ca","tag-canada","tag-canada-news","tag-canada-sports","tag-canada-sports-news","tag-canada-trafficcanada-weather","tag-canadian-breaking-news","tag-canadian-news","tag-economy","tag-education","tag-environment","tag-federal-government","tag-foreign-news","tag-globe-and-mail","tag-globe-and-mail-breaking-news","tag-globe-and-mail-canada-news","tag-government","tag-life-news","tag-lifestyle","tag-local-news","tag-manitoba","tag-national-news","tag-new-brunswick","tag-newfoundland-and-labrador","tag-northwest-territories","tag-nova-scotia","tag-nunavut","tag-ontario","tag-pei","tag-photos","tag-political-news","tag-political-opinion","tag-politics","tag-politics-news","tag-quebec","tag-sports-news","tag-technology","tag-travel","tag-trudeau","tag-us-news","tag-world-news","tag-yukon"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/513947","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=513947"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/513947\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/513948"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=513947"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=513947"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=513947"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}