AI has reshaped nearly every industry conversation in the last two years. LegalTech has been no exception. Walk into any conference lately and you will see the same trend: booths plastered with promises of “AI-powered” everything. For a while, it felt like the future had arrived overnight. But as the dust settles, the cracks are showing. The industry is now staring at the beginning of an AI bubble correction.
How We Got Here
ChatGPT’s launch on November 30, 2022 changed the conversation almost instantly. Suddenly, every law firm and technology vendor was asking the same question: “What can we do with this?” Some startups were built entirely on the back of ChatGPT, pitching themselves as revolutionary new solutions. In reality, most of these tools were simple wrappers. Thin interfaces on top of a general-purpose model.
The pattern was not unique to law. Analysts have already called out the hype, noting that many legal tech players were rushing products to market that had little differentiation. As JDSupra recently put it, “the legal tech world has become a gold rush, and most prospectors are selling fool’s gold.” Ouch.
The Problem With Wrappers
At first, the excitement was contagious. Lawyers who had struggled with clunky software for years could suddenly see responses generated in seconds. But the deeper problem soon became clear. If a solution does not go beyond what ChatGPT itself can do, why pay for it? Firms started asking hard questions, and many of those wrapper-based startups are already beginning to fade.
The challenge was never the technology itself. The challenge was that too many companies tried to build businesses on borrowed capabilities. A new UI or a single use case does not create long-term value if the core engine is something anyone can buy for twenty dollars a month.
This isn’t just our perspective. On a recent episode of the All-In Podcast, Chamath Palihapitiya warned that AI is already heading into bubble territory. His point was that value will consolidate around those who own data and distribution, not those who simply package up access to existing models. The legal industry is starting to feel that pressure right now.
The Real Opportunity: Data
The truth is that AI without proprietary data is generic. It can only generate what everyone else can generate. That is why data has always been our focus at Quilia. Data is the gold of AI. Without it, there is no foundation to build on.
From the start, Quilia has prioritized collecting a unique kind of information: client-driven data in personal injury cases. This goes beyond documents and deadlines. It is about capturing treatment details, compliance signals, and engagement insights directly from the client. This information forms a data layer that no general-purpose AI model can replicate. With it, we can power predictions, surface risks, and deliver outcomes that truly move the needle for attorneys and clients.
Built Before the Hype
Quilia was founded in January 2022, almost a year before ChatGPT. That timeline matters. We were not created as a reaction to the AI boom. Our foundation has always been about solving a specific problem in personal injury law: improving client engagement and case completeness through technology.
For years, we deliberately avoided marketing ourselves as an “AI company.” We did not even add the term to our website until June 2025. Why? Because substance matters more than hype. AI is one of the tools we use, but it is not the product itself. Quilia’s product is better cases, stronger client compliance, and improved outcomes. AI simply helps accelerate that mission.
What the Bubble Burst Means
The AI correction that is starting to hit LegalTech is healthy. The industry is moving past the initial “shiny object” stage and into a phase where value will be judged on real results. Startups that leaned on thin wrappers will struggle. Investors will become more cautious. Law firms will ask tougher questions. And that is exactly what should happen.
Even outside of LegalTech, the conversation has shifted. On Hacker News, one reader summed it up well:
A bursting bubble doesn’t instakill an entire industry... infrastructure, ideas and developments will stay and probably end up being a lot more useful without the noisy hype.
That is exactly how we see it. The bubble popping doesn’t kill AI. It clears the stage for those who are building durable infrastructure and real value.
Why Quilia Is Ready
While others were chasing hype, Quilia was building infrastructure. Our app captures proprietary client data that other systems miss. We have built integrations with major case management platforms to ensure that data flows seamlessly. We have created features that directly improve client compliance, treatment tracking, and case outcomes.
This foundation gives us a powerful advantage in the post-bubble LegalTech world. As general-purpose AI models continue to improve, the value will not come from who can build the prettiest wrapper. It will come from those who have the best data to power those models in meaningful, case-specific ways. That is the bet we made from day one.
The Road Ahead
The AI bubble may be collapsing, but the story is far from over. What comes next is a more mature and sustainable phase of innovation. Tools that deliver real insights, grounded in proprietary data, will rise above the noise. And in personal injury law, no one is better positioned than Quilia.
We have been building for this moment since 2022. While others sprinted to market with wrappers, we invested in the hard work of capturing unique client data and delivering real value. As the hype fades, the companies that survive will be the ones with foundations built on substance, not slogans.
The next wave of Quilia’s AI-driven features is coming soon. And unlike the wrappers, they are built on something no one else has: the voice of the client.