Litem sells $6.17M in equity after expanding beyond deposition AI

Why it matters

Litem's filing reveals a financing more than 10 times its earlier disclosed offerings as its founders turn a deposition assistant into a case-wide legal AI platform. The round supports a credible enterprise push, while its valuation, investors and new-cash component remain undisclosed.

Litem, founded by Mitchell Kossoris and Dongyang (Donnie) Li, has sold $6,173,982 of a planned $6,673,982 equity offering, according to a new Form D filed with the SEC on September 15th.

The Bellevue, Washington-based legal AI developer reported its first sale on September 9th, six days before filing the notice. Twenty-seven investors have participated under the SEC's Rule 506(b) exemption, with no non-accredited investors listed. Another $500,000 remains available in the offering.

The filing requires some careful reading. Litem said the $6.17 million sold includes cash from new investors as well as outstanding debt and convertible securities converted into stock. The document does not separate the new cash from those conversions, and it identifies neither the investors nor Litem's valuation.

Even with that qualification, the financing is a steep increase for a developer that was relying on friends and family funding when it began selling its deposition product in January 2025. Two earlier SEC filings reported $423,888 sold in a debt offering and $175,000 sold through a later bridge financing. The latest offering is more than 10 times those amounts combined, although converted securities could create some overlap between the filings.

Kossoris signed the notice as Litem's co-founder and CEO. Li, Litem's co-founder and CTO, is also listed as an executive officer and director. The filing adds Cormac O'Connor as a director.

A deposition wedge becomes a case platform

Kossoris grew up with two litigation attorneys as parents and later worked as a software development engineer at Amazon Web Services. He told legal technology publication LawNext in February 2025 that he had watched the preparation and stress surrounding depositions from an early age.

He and Li left AWS to test whether generative AI could take on some of that work. Deposely, as Litem was then known, started with tools for turning case documents and transcripts into deposition outlines, summaries and suggested questions. Its central product later became a live workspace that compares a witness's testimony with prior statements and documentary evidence while the deposition is underway.

That narrow entry point gave Kossoris and Li access to a larger problem: the factual record for a lawsuit remains scattered across documents, exhibits, transcripts, video and lawyers' notes. The founders began extending the same fact-extraction system across the rest of a case.

Deposely rebranded as Litem on August 19th, 27 days before the new filing. The name change accompanied a shift from a deposition product toward a broader litigation-intelligence platform.

Litem Depositions remains the established product. It generates preparation materials, tracks testimony and objectives during proceedings, flags possible contradictions or evasive answers, and produces summaries tied to transcript page and line numbers. Litem says the software can reduce preparation time by as much as 75%, a result that has not been independently benchmarked.

The next product, Litem Facts, is scheduled for fall 2026. Litem says it can process case records exceeding 100,000 pages, extract facts, identify conflicting assertions and generate filtered chronologies. Litem Agent uses that record to answer questions and draft motions, memos, deposition summaries and client updates with citations.

The strategy turns depositions into a distribution wedge. Once a law firm loads its evidence and testimony into Litem, the same factual record can support preparation, live analysis, chronology building and drafting. That gives Litem more opportunities to become embedded in a matter while raising the cost of moving case data to a different product.

From a $50 customer to an enterprise sales claim

Kossoris has said Litem's first paying customer signed up for $50 a month in January 2025. In an August post announcing the rebrand, he said Litem finished 2025 with less than $250,000 in annual revenue and employed fewer than 20 people.

Litem now claims its software supports more than 10,000 depositions each month for more than 20,000 legal professionals, including attorneys at over 50 Am Law 200 firms. Its website identifies U.S. Legal Support and Universal Court Reporting as partners and names Rutan among its users.

Those usage numbers come from Litem rather than customer disclosures or audited reporting. They also measure professionals and proceedings, rather than paying accounts or recognized revenue. The figures still describe a faster enterprise push than Litem's early funding history would suggest.

Kossoris also says signed contracts put Litem on track to reach $10 million in annual revenue by the end of 2026, according to the August rebrand announcement. The wording matters: the claim describes a year-end trajectory based on contracts, rather than revenue already recognized. Litem has not published pricing, customer concentration, retention or the amount currently being collected under those agreements.

The SEC filing declines to disclose Litem's revenue range, making the $10 million projection impossible to reconcile against a regulatory filing. It does establish that investors were willing to purchase or convert more than $6 million of securities shortly after Litem presented itself as a broader platform.

The bet behind the timing

The financing arrives as Litem prepares to ship Facts and sell law firms on a shared intelligence layer for an entire lawsuit. That is a larger engineering and enterprise-sales job than serving as an assistant during a single deposition.

Litem must ingest large case records, preserve reliable citations and control access to sensitive legal information while producing answers quickly enough for live proceedings. The product also has to earn trust from lawyers who remain responsible for checking every output. Litem says it is SOC 2 and HIPAA compliant, though the materials reviewed for this story do not include the underlying certification reports.

Kossoris has been unusually direct about the adoption problem. In the August rebrand announcement, he said legal innovation leaders had encountered AI products that performed well in demonstrations and then failed during pilots. Litem's response was to begin with a defined workflow and stay quiet while law firms tested it.

The new capital gives Kossoris and Li room to widen that workflow. It also increases the burden behind their traction claims. Investors are backing Litem at the point where a focused deposition product is becoming a system expected to understand the whole factual record. The next test is whether the founders can preserve the reliability that helped win those early legal customers as Litem takes on far more of their cases.