The Law Firm of Chat, Claude, Copilot, Meta & Gemini

(and how to “hire” them without putting your startup at risk)

Let’s be honest — if you’re bootstrapping or running lean, you’re looking for ways to extend your runway. That might mean AI becomes your “law firm.”

You’re not alone. The Washington Post recently tested five leading AI tools and the scores for legal work ranged from 69/100 (Claude) to 26/100 (Meta AI).

The grades were underwhelming, but the takeaway isn’t “don’t use AI.” It’s don’t have a false sense of security. AI can be incredibly useful for startups — if you know where it’s safe to use and where it can hurt you.

Why AI Struggles with Legal Work

Even when AI sounds confident, there are reasons it can miss the mark:

• Negotiated contracts can be messy – AI is only as good as its training data and there are a lot of contracts out there that should not be used as models.

• Borrowed language – It may draw on SEC filings or public contracts that don’t fit your situation.

• Jurisdiction matters – Laws differ between states and countries. AI doesn’t always get that right.

• Terms of art – Subtle legal meanings often get lost.

• Prompting limits – Even great prompts can’t replace actual legal judgment.

And remember: even the best human lawyers can disagree. Expecting AI to always nail complex, high-stakes clauses is unrealistic.

When AI Can Safely Help Your Startup

You can get real value from AI if you use it where mistakes won’t cripple your business:

• Summarizing contracts you wouldn’t read otherwise.

• Reviewing agreements you must sign but can’t change.

• Drafting a first version of simple, standard forms like NDAs.

• Battle-testing assumptions (“What could go wrong if X happens?”).

• Working on issues where errors won’t have a material impact.

Pro tip: make sure you’re not building a legal foundation on AI-generated “knowledge” you can’t easily undo later.

When You Shouldn’t Rely on AI

There are places where AI is more liability than asset:

• Contracts that are fundamental to your business.

• Anything in your dataroom for fundraising or M&A.

• Agreements involving customer or client data.

• Contracts where termination or penalties could be severe.

• Highly specialized services agreements.

• Creating or customizing your key form agreements.

In these situations, human legal review isn’t a luxury — it’s a necessity.

Bottom Line for Startups

AI can be your 24/7 junior legal assistant. It’s fast, cheap, and always available. But it’s not your General Counsel.

If you let AI into your legal workflow, do it strategically:

• Use it for speed where stakes are low.

• Avoid it where errors could cost equity, customers, or valuation.

• Never assume “it sounds right” means “it is right.”

The worst mistake isn’t using AI for legal work. It’s believing you’re safe when you’re not.

And the best lawyers for startups have the dataroom in mind when providing guidance, keeping their time - and the bills - minimal.