Legal teams are becoming more selective about how they use artificial intelligence, especially when contracts contain sensitive or regulated information. Against that backdrop, SpotDraft has raised $8 million from Qualcomm Ventures in a strategic extension of its Series B round, as the company looks to scale contract review tools that can run directly on a user’s device.
The latest investment values the startup at around $380 million, nearly twice the valuation it reached after closing a $56 million Series B round last year, the company said.
Enterprises across sectors have moved quickly to test generative AI, but legal departments have often taken a slower path. Contracts routinely include confidential pricing terms, intellectual property, and legally privileged material. For many organizations, sending those documents to external cloud-based AI systems is not an option, either due to internal policy or regulatory requirements.
SpotDraft’s answer has been to shift contract analysis away from the cloud. The company has built its VerifAI workflow to operate locally on laptops, allowing documents to be reviewed without being uploaded to remote servers. At Qualcomm’s Snapdragon Summit 2025, SpotDraft demonstrated the system running offline on devices powered by Snapdragon X Elite processors. During the demonstration, contracts were reviewed, risks flagged, and edits suggested while the files remained on the local machine.
According to SpotDraft, internet access is still needed for user authentication, licensing, and collaboration features. The core contract review process, however, can function without an active connection.
Why Legal Teams Are Turning to On-Device AI
The company sees legal teams as an early test case for on-device enterprise AI. Co-founder and CEO Shashank Bijapur said sensitive documents demand systems that prioritize privacy and speed, particularly in environments shaped by compliance and legal scrutiny.
VerifAI is designed to work inside Microsoft Word, rather than requiring lawyers to switch tools. The system compares contracts against a company’s own playbooks, policies, and past standards, highlighting areas that may require changes. Co-founder and CTO Madhav Bhagat said the focus is on applying existing legal guidelines consistently, not automating decisions.
Interest in on-device AI is also coming from heavily regulated industries such as defense and pharmaceuticals. In those sectors, internal security reviews and data residency rules can delay or block cloud-based AI tools altogether, SpotDraft said.
Hardware improvements have made local AI more practical than it was even a few years ago. Bhagat said recent chips have narrowed the performance gap between on-device models and cloud-based systems, with response times improving significantly.
SpotDraft was founded in 2017 and has continued to add customers over the past year. The company now works with more than 700 organizations and processes over one million contracts annually. Contract volumes on the platform have grown sharply year over year, and monthly active users are close to 50,000. The company expects revenue to grow again in 2026 following strong performance in the past two years, though it did not disclose exact figures.
The new funding will be used to expand SpotDraft’s product capabilities and grow its enterprise presence across the Americas, Europe, the Middle East, Africa, and India. Qualcomm’s role will include collaboration beyond capital, particularly around deploying on-device AI on compatible hardware.
SpotDraft’s on-device workflow is currently available to a limited number of customers. The company expects broader adoption as AI-enabled PCs become more common in enterprise environments.
Based in Bengaluru and New York, SpotDraft employs more than 300 people globally, with teams in the U.S., the UK, and India. Including the latest funding, the company has raised a total of $92 million to date.
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