The legal technology sector is experiencing an unprecedented boom. Fueled by venture capital, the rise of generative AI, and a growing appetite for innovation among law firms, legal tech is now a hotbed of activity. Startups are sprouting, unicorns are being minted, and nearly every law firm is running paid trials of competing tools. But beneath the surface, industry insiders are voicing concerns: Is this surge sustainable, or are we in the midst of a legal tech bubble?

The Paid Trial Phenomenon: Growth or Illusion?

At the heart of the current boom is a frenzy of paid trials. Law firms, eager not to be left behind, are testing out multiple legal tech products simultaneously, often paying for hundreds of licenses as part of pilot programs. This influx of trial revenue is being booked as recurring income by software vendors, inflating company valuations and attracting even more investment.

However, as Zach Abramowitz, a consultant to law firms and legal departments, warns, most of this revenue is not yet "sticky." The majority are pilot programs, not long-term contracts. While some products, like the much-hyped Harvey, are gaining traction, it's unclear whether they will secure lasting, organization-wide adoption or if law firms will ultimately walk away once the trial period ends.

This dynamic has led to a situation where, as one investor put it, "every single one of these companies is working"—at least on paper. But if every company in a category appears successful, it may simply indicate that the market is awash with experimentation, not genuine product-market fit.

Why This Bubble Might Not Be All Bad

As the initial excitement fades, experts predict a "reckoning" in the coming 12 to 18 months. Law firms will consolidate around a handful of proven performers, while many vendors will see revenues decline as pilot programs end and only the most valuable tools survive the culling.

Some argue that a legal tech bubble, while risky for investors and startups, is a net positive for buyers. The influx of capital and competition is driving rapid innovation, better products, and lower prices. Lawyers and clients benefit from improved efficiency, automation, and access to new tools that were previously unimaginable. Even if many startups fail, the survivors will have been battle-tested in a demanding market.

A Call to Legal Tech Buyers: How to Navigate the Hype

For legal departments and law firms, the challenge is clear: how to make smart choices in a market where everyone is trying everything, and every vendor claims to be the next big thing. Here are practical steps to navigate this crowded terrain:

• Start with your goals, not the tech. Define your department’s strategic objectives and pain points before looking at solutions. Don’t let flashy demos distract from your real needs.
• Engage all stakeholders. Involve lawyers, operations, IT, to ensure buy-in and compatibility with existing systems.
• Prioritize usability and adoption. The best tool is useless if your team won’t use it. Focus on solutions that are intuitive, require minimal training, and integrate smoothly into daily workflows. Sonar Legal is built to work where lawyers already work: directly inside Word, no training needed.
• Pilot with purpose, not FOMO. Run trials with clear success metrics and a plan for full adoption if the tool delivers. Avoid spreading resources thin across too many simultaneous pilots. At Sonar Legal, we are making things easy for you, offering a completely free trial. No credit card, no automatic renewals once the trial ends: just real value from day one.
• Plan for the long term. Look beyond the pilot phase. Will the vendor be a sustainable partner? Does their roadmap align with your evolving needs? Sonar Legal is a vendor built for the next decade. It is cash-flow positive, sustainable by design, and not hungry for VC cash. We are making our money by realizing value for our clients, not by selling hope to VC investors.

Conclusion: Be a Discerning Buyer in a Bubble Market

The legal tech market is at a crossroads. While the current bubble is driving innovation and opportunity, it also brings risk and noise. As a legal tech buyer, your best defense is a disciplined, objective approach to selection and adoption. Don’t chase every shiny new tool; instead, focus on solutions that solve your real problems, fit your workflows, and demonstrate lasting value. In a landscape where everyone is trying everything, the winners will be those who buy—and build—with clarity and purpose. Start with a tool that values sustainability, transparency, and usability. Try Sonar Legal for free today. No trial traps, just results.