noxtua Raises $92M for German Legal AI | Sovereign AI

Noxtua Secures $92.2 Million Series B Funding for Sovereign Legal AI

Originally founded in 2020 as Xayn, a privacy-focused AI startup for mobile devices, the company has undergone a significant transformation. It now concentrates on the development of sovereign AI solutions tailored for the legal profession. This evolution has culminated in a rebranding to Noxtua and the successful completion of a $92.2 million (approximately €81.2 million) Series B funding round.

Strategic Investment and Key Partnerships

The funding round was spearheaded by C.H. Beck, a prominent strategic investor and Germany’s foremost legal publisher. C.H. Beck maintains an extensive repository of German legal cases and rulings, providing a uniquely advantageous position. Noxtua will leverage complete access to this archive and a dedicated legal news service for its innovative legal AI product, Beck-Noxtua.

Further investment comes from several new entities, including Northern Data Group, a specialist in high-performance computing, CMS – Germany’s largest business law firm – and the international firm Dentons. Existing investors, such as Global Brain, KDDI Open Innovation Fund, and Dominik Schiener, also participated.

Sovereign AI and Data Security

The inclusion of Northern Data is particularly noteworthy. Beck-Noxtua will operate as a sovereign AI hosted on the company’s cloud infrastructure, which is entirely located within Germany.

Noxtua asserts that its specialized AI is capable of conducting legal research, analyzing information, and drafting legal documentation, all while adhering to stringent legal standards for its clientele, including those operating within Germany. The rigorous legal compliance requirements in Germany necessitate the accuracy afforded by C.H. Beck’s extensive training data – a database encompassing 55 million documents, the largest of its kind in the German-speaking world.

Concerns surrounding geopolitical factors and the implications of utilizing U.S.-based infrastructure for German AI models prompted Noxtua to establish a hosting partnership with Frankfurt-based Northern Data.

Technology and Competitive Advantage

Dr. Leif-Nissen Lundbæk, CEO and co-founder of Noxtua, explained in an interview with TechCrunch that the company employs a customized transformer AI model. This model is specifically trained on legal contracts. “We have already deployed it to numerous law firms and legal departments, and are collaborating with C.H. Beck,” he stated, describing C.H. Beck as the “Thompson Reuters of the legal sector in Germany.”

Lundbæk emphasized the necessity of this approach, as U.S.-based foundational models are primarily trained on American and, to some extent, British data and contractual frameworks.

“These models demonstrate significantly reduced precision when applied to countries like Germany or France,” he added. “Furthermore, governmental operations inherently involve legal aspects, making the use of a U.S.-based AI model unsuitable within a German legal context.”

Origins and Future Outlook

Noxtua’s core technology stems from research conducted by the founders at the University of Oxford and Imperial College London, with further development undertaken in collaboration with CMS.

Professor Klaus Weber, a member of the executive board at C.H. Beck, commented, “Noxtua’s commitment to a sovereign European legal AI perfectly aligns with our core principles… Noxtua represents a vital component of our innovation strategy.”