In July, LegalZoom announced it raised $500 million. By mid-September, Atrium secured $65 million in new funding for its internet-based legal services geared toward startups. And last week, Court Buddy Co. Inc. revealed it raised $6 million in outside funding.

Venture capital counsel who spoke to Legaltech News said business-to-consumer legal technology services seem to be catching on, and investments are following. But time will tell if such high-dollar investments will become common.

According to a 2017 article in Medium, venture capital funding in legal tech startups increased 10 percent during 2011 to 2016. No data was available regarding how much has been invested in legal startups this year, but Legaltech News reported LegalZoom's $500 million investment was the largest in legal technology history.

Still, potential investors may be apprehensive to invest in consumer legal tech because of the regulations governing the legal profession, said Court Buddy co-founder James Jones, Jr: “To be quite frank, legal tech has been a hard sell to investors because it's highly regulated.”

He added that the various rules and regulations that vary from jurisdictions leads investors to “generally look at law as a difficult industry to crack.”

However, Jones' own company recently announced it acquired $6 million in funding. The three-year-old Court Buddy provides a la carte legal services and flat rates for clients seeking a solo practitioner, essentially acting as a communication liaison between attorneys and consumers.

The startup raised $6 million from investors NFX; First Round Capital; Kapor Capital, and existing investors LDR Ventures, Lightspeed's LSS Fund, Gingerbread Capital, UpHonest Capital, L.A. Women Angels and numerous angel investors, according to media reports.

The new investors now own 25 percent of the company, with co-founders James Jones Jr. and Kristina Jones retaining their majority shareholder status.

In 2017, the company also raised $1 million, making co-founder Kristina Jones the 14th African-American woman to raise over a million dollars in venture capital, according to the Miami Herald. The co-founders said they would use their new investments for market expansion, key hiring and research and development.

Richard Ginsberg, who chairs Winston & Strawn's technology and emerging companies practice group, said there's a need in the consumer market for such consumer-focused legal services, but it isn't clear if many others companies will secure multi-million dollar investments similar to LegalZoom.

“To compete directly with LegalZoom would be hard. There's other approaches companies can take to provide basic legal services,” he explained.

But Bryan Ito Springmeyer, a San Francisco-based attorney who has counseled angel and venture capital financing, added that while venture capital funding is mostly based on Big Law service providers, “if any of those companies are successful, venture capitals would be interested.”

Various business-consumer legal tech startups have found investors as well , though not all have offered services similar to LegalZoom's automated documents.

Earlier this year, Avvo was acquired by media and software services company Internet Brands Inc. for an undisclosed amount. However, under pressure from state bar associations that criticized Avvo for improper fee-splitting arrangements and unauthorized practice of law, Internet Brands announced Avvo Legal Services would discontinue in July. On Tuesday, Internet Brands relaunched Avvo as a lawyer search and ranking service with a free question-and-answer option.