AI makes inroads in legaltech but investment firms want tailored solutions

As investment firms increasingly explore the use of legal technology to streamline operations and reduce reliance on external advisers, AI is seen as a tool to deliver both cost savings and efficiency gains.

At DealStreetAsia’s Asia PE-VC Summit 2025 in Singapore last month, a panel session titled ‘AI portfolio impact: unlocking the next value brought together executives from Azalea Investment Management, Partners Group, Climate Fund Managers, and Robin—the panel’s sponsor—to discuss how AI innovations are being applied to accelerate and strengthen legal and compliance operations.

While all the panellists said their firms use AI tools for a range of purposes, they added that legal work calls for more specialised solutions.

Sue Ann Lee, APAC Regional Head of Corporate Legal for global investment firm Partners Group, argued that, given the “layered” and “nuanced” nature of legal work and interpretations, the accuracy and security of generic AI tools would be a concern.

Kenneth Chen, legal counsel at Singapore’s Azalea Investment Management, picked up on the point, stressing that the industry stands to gain far more from AI tools designed by people who have worked in the legal industry and understand its inner workings.

“I think that is something that would allow us to replace external help in the future—and gives us some competitive advantage,” said Chen.

Expertise and exposure are key to adoption

At Partners Group, Lee said she and her team have either used or explored over 20 AI applications, but admits to adopting a “measured and deliberate approach towards AI adoption”.

Likewise, Chen noted that while Azalea relies on Microsoft Copilot to boost workplace efficiency, the firm chose to develop its own AI chatbot—Azalea GPT. The in-house tool was created to give the company more control over its systems and ensure stronger safeguards around sensitive data.

The reserved and cautious approach among legal departments in adopting third-party AI tools is understandable, given the confidential and sensitive nature of legal work. However, it may also stem from a gap in understanding and practical exposure to legal tech solutions and how they operate, as suggested in a survey by PricewaterhouseCoopers (PwC).

The 2023 NewLaw survey by the professional services firm found that 92% of general counsels (GCs) and 83% of chief legal officers (CLOs) in Asia Pacific rated their knowledge of legal technology and digital transformation as below average. A further 77% cited limited awareness of available legal tech solutions as one of their biggest challenges.

In fact, out of the 33 categories of legaltech tools that are available in Asia, the report finds that GCs in the region are mostly only accustomed to e-signature software (86%), followed by document management systems (37%) and file instruction intake or triage tools (28%).

The findings suggest that broader AI adoption in legal teams will require legaltech providers to do more than refine their solutions for industry needs; they must also raise visibility and ensure their tools reach the right users.

Chen cited Singapore-based Robin as a legaltech firm whose tools his team at Azalea has adopted and found valuable, as it addresses one of his team’s major pain points, which is repetitive negotiations with multiple general partners.

“Robin has managed services, including NDA services, that basically allow us to almost automate the process altogether. There’s a human in the loop, and there’s an underlying AI tool that Robin uses based on our playbook and negotiates on our behalf,” he said.

He added that the service has significantly improved efficiency, cutting turnaround times to about half a day—far quicker than handling the process in-house or through external contractors. Chen said such time savings are especially critical for asset managers working on co-investment deals, where tight timelines demand fast and reliable execution.

Smart use of AI

While AI can ease plenty of workload for legal teams, the speakers noted that the industry must learn to use these tools in the right way and be cautious about overrelying on them.

Jolyn Ang, the general counsel for Asia at Climate Fund Managers, said legal professionals need to be clear on what they expect AI to do and how they interact with it.

Ang explained that the smart use of AI starts with breaking down tasks into two categories: information extraction and processing, and judgment. While training AI to handle the second stage remains difficult, she noted that automating extraction tasks can deliver significant efficiency gains.

She explained that responding to contract queries typically involves locating, reviewing and drafting, which can take up to an hour. Automating this first stage, Jolyn added, would save considerable time and allow legal teams to focus on higher-value work.

“If I can fully automate that bucket of tasks, I can save a lot of time, not just for me, but also for my investment team, to actually focus on what they need to do, which is to generate value,” she said.

Frederik Muelke, global head of alternative assets at Robin, said the most effective way for legal teams new to AI is to focus on “low-hanging fruit” tasks that can be automated quickly and deliver immediate results.

Muelke added that starting small allows teams to build confidence and see quick wins before moving on to more ambitious projects.

“We find that teams that go for the low-hanging fruit first achieve a lot more adoption than teams that shoot for the stars straight away. That way, early adopters then don’t feel disillusioned, but rather see something working, get either time or money value out of it, and then keep going on the journey,” he said.