tech
Why Legora's CEO is betting that every software company ends up ditching the seat
CEO Max Junestrand told Business Insider why Legora adopted a usage-based pricing model, reflecting AI's impact on software economics.
TL;DR
- Legora, a legal tech startup, has moved away from a user-based software pricing model to a usage-based one.
- This change is driven by the increasing computational costs associated with AI features in software.
- CEO Max Junestrand believes this shift is necessary as AI scrambles traditional software economics.
- Existing customers can upgrade to AI agents on a consumption basis, while new customers are on pay-as-you-go pricing.
- Some customers appreciate the ability to track and link software spending to specific legal matters.
- Other firms are cautious, still evaluating how AI fits into their workflows before committing to usage-based tiers.
- Usage-based pricing may be crucial for the survival of some startups to manage costs from model providers.
- Competitors like Harvey are still offering seat-based pricing but are exploring additional usage-based options.