Sandstone secures $30 million Series A to target in-house legal AI market
Led by Lightspeed Venture Partners with participation from Sequoia, the funding follows a $10 million seed round earlier this year as investors back specialised vertical AI solutions.
Sandstone has raised $30 million in Series A funding to develop artificial intelligence tools tailored for in-house legal teams at small and mid-sized businesses. The round was led by Lightspeed Venture Partners, with participation from existing investors including Sequoia, Mantis VC, SV Angel, Operator Partners, Kearny Jackson, Daybreak Ventures, and Litquidity Ventures.
The announcement, made on Tuesday, marks the company’s second major financing event in six months. It follows a $10 million seed round in January 2026, which was led by Sequoia. The capital injection comes as the legal technology sector becomes one of the fastest-growing verticals for AI startups, with competitors such as Harvey and Legora having already secured eight-figure funding rounds.
Unlike many of its peers that focus on private practice firms, Sandstone is targeting the overlooked in-house legal market. Co-founder and chief operating officer Jarryd Strydom described the platform as a solution for the complex intake processes faced by internal legal departments. The system routes work from channels such as Slack, email, and Jira, allowing teams to triage tasks and build custom workflows for drafting, reviewing, or providing legal analysis.
Lightspeed Venture Partners cited a conviction in highly specialised vertical AI as a key driver for the investment. According to Strydom, this approach requires a granular understanding of specific workflows to effectively deploy AI. The platform distinguishes itself from legal reasoning systems by focusing on relationship management and workflow automation, areas where more generalized AI deployments often struggle.
The competitive landscape remains intense, with frontier AI labs increasingly entering the space. In May 2026, Anthropic expanded its Claude for Legal offering, adding tools for case law searches and deposition preparation. Sandstone will need to navigate this competition while establishing its position in the in-house legal market, where specific operational needs differ significantly from those of private practice firms.
