In this edition of Localogy’s Local Radar, we examine newly funded companies Rillet, LegalOn & Calo

1. Rillet

AI-forward companies continue to get the lion’s share of attention and funding these days. And the ones that are well placed tend to apply AI to the areas where it can make the most impact. That list of criteria includes tasks that are mechanical, repetitive, and rote. Among all the functional business areas to which these descriptors apply, accounting is near the top of the list. For large and small businesses, the beating heart of the accounting department is the general ledger system – summarizing transactions and holding all the data needed for financial statements and tax preparation. This is where Rillet hopes to use AI to transform the humble general ledger, and it recently received $25 million in series A funding, led by Sequoia, to do so. The company uses machine learning to automate accounting reports and financial statements. It taps into its customers’ banks and fintech platforms to automatically generate all the financial data needed for things like balance sheets and P&Ls. The value proposition for resource-constrained SMBs is to close their monthly or quarterly books in hours rather than weeks. And that message is working so far, given Rillet’s 5x year-over-year revenue growth and 200+ paying customers. But there are switching costs, which translate to adoption barriers for new entrants. Getting companies to switch their general ledger systems is onerous and invasive. So Rillet is hoping to seize the current moment of AI disruption and replacement cycles.

2. LegalOn

When looking at the above factors that create fertile ground for AI – rote, repetitive & mechanical tasks – the list also applies to some (but not all) legal work. For example, contract review is a slow and manual process that strains legal teams, yet it’s something that can be largely automated in the age of AI. For example, traditional processes involve typical document collaboration between several lawyers who must manually sift through dense language and perfect the output. And the high-stakes legal field means that mistakes are costly. This is the issue that LegalOn Technologies is trying to solve with an AI-based approach to contract review. It utilizes language models that have been trained on nuances within several areas of law so that it can automate large portions of the contract review process. And the company claims that it can both reduce review times by up to 85 percent while improving accuracy and quality control. Beyond the company’s own claims, the numbers speak for themselves in its customer list of 7,000 law firms across the U.S., U.K., and Japan; and its 4x year-over-year revenue growth. All the above was enough to land LegalOn $50 million in Series E funding led by Goldman Sachs’ growth equity fund. This brings its total lifetime funding up to $200 million. The company plans to use the latest cash infusion to further develop and refine its AI agent tools, and to beef up sales efforts to penetrate further into the above geographic markets.

3. Calo

Moving from AI-fueled professional services to something completely different, food delivery startup Calo has raised $39 million in a Series B extension round, led by Aljazira Capital. The company is trying to transform the food delivery market with ready-to-eat meals that customers can heat up later. The thinking is that there are quality control issues with food delivery because meals are generally prepared with the intention of someone eating them immediately. But due to delivery times and other factors, food is often eaten past that quality window – classic examples including soggy French fries and cold pizza. By factoring in the reality of that latency, Calo’s products are optimized for later consumption windows, resulting in a higher-quality experience when the food is actually eaten. It’s working so far as the company almost 2x’d its revenue in the past year and delivered more than 10 million meals. As for the new funding, Calo will use it to expand into the U.K., where it has already acquired two meal delivery services – Fresh Fitness Food and Detox Kitchen. As the names of these aqcuirees suggest, Calo is also going deeper into food subverticals, such as dieting and fitness regimens. These categories are attractive due to their subscription-based nature and recurring revenue.

Header image credit: Scott Graham on Unsplash