{"id":5748,"date":"2026-08-27T08:00:00","date_gmt":"2026-08-27T15:00:00","guid":{"rendered":"https:\/\/www.microsoft.com\/en-us\/startups\/blog\/?p=5748"},"modified":"2026-08-26T13:36:51","modified_gmt":"2026-08-26T20:36:51","slug":"three-architecture-decisions-behind-ponss-legal-ai-platform-on-microsoft-azure","status":"publish","type":"post","link":"https:\/\/www.microsoft.com\/en-us\/startups\/blog\/three-architecture-decisions-behind-ponss-legal-ai-platform-on-microsoft-azure\/","title":{"rendered":"Three architecture decisions\u00a0behind PONS&#8217;s legal AI platform on Microsoft Azure\u00a0"},"content":{"rendered":"\n<div class=\"summary\" data-bi-an=\"Summary Block\" aria-describedby=\"summary\">\n\t<p>\n\t\t<span class=\"summary__prefix\">Summary<\/span>\n\t\t<span class=\"summary__content\"><em>PONS shares three design decisions behind its legal AI platform on Microsoft Azure, from separating public legal knowledge and customer data to using managed services and implementing security and compliance controls. The article highlights practical considerations for startups developing AI for regulated enterprise customers.<\/em> <\/span>\n\t<\/p>\n<\/div>\n\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\" \/>\n\n\n\n<p class=\"wp-block-paragraph\">Building legal AI for regulated industries requires more than connecting a model to documents. For startups serving regulated industries, the challenge isn&#8217;t only model capability, but how the system handles trusted sources, private data, infrastructure priorities, and compliance requirements.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">PONS built its legal AI platform around those constraints. Running on <a href=\"https:\/\/azure.microsoft.com?wt.mc_id=legalarchitecture_azure_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Microsoft Azure<\/a>, it supports research, drafting, contract review, due diligence, and matter management for law firms, in-house legal teams, and other regulated organizations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This post examines three design decisions behind the platform and what startups developing AI for regulated customers can learn from them.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Through <a href=\"https:\/\/www.microsoft.com\/startups?wt.mc_id=legalarchitecture_apply_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Microsoft for Startups<\/a>, PONS was able to access Startup credits, technical guidance, and timely introductions while developing its EU-hosted Azure architecture. According to PONS, this support helped its small team test architectural decisions against real workloads and address technical requirements for regulated customers.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Building AI for regulated enterprise customers? Eligible startups can apply to Microsoft for Startups for access to Startup credits that unlock as you build, developer tools, technical guidance, and opportunities to reach customers.<\/p>\n\n\n\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-a89b3969 wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/www.microsoft.com\/startups?wt.mc_id=legalarchitecture_apply_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Apply to Microsoft for Startups<\/a><\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"inside-the-pons-legal-ai-architecture-on-azure\">Inside the PONS legal AI architecture on Azure<\/h2>\n\n\n\n<blockquote class=\"wp-block-quote has-quote-default-font-size is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"wp-block-paragraph\">The hard part of legal AI is the data. Our Data Factory grounds answers in real, current legislation and case law, then connects it to your own matters and files\u2014without leaving our Azure tenancy or running through a public model. Your data is our highest priority: it&#8217;s encrypted with AES-256 before it reaches the database, at rest in Azure, and in transit\u2014three layers, by default.<\/p>\n<cite><strong>Tobias Zimmergren, CTO and technical co-founder, PONS<\/strong><\/cite><\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"https:\/\/pons.io\/?wt.mc_id=legalarchitecture_pons_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">The PONS platform<\/a> consists of two primary components: the PONS Data Factory and the PONS AI Engine.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The PONS Data Factory is a continuous pipeline that validates, collects, cleans, and indexes public legal sources, including legislation, case law, and precedents. It adds semantic metadata, hierarchical structure, vector embeddings, and source-linked references to create a curated legal corpus available across multiple jurisdictions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The PONS AI Engine supports cited reasoning, drafting, contract review, and structured extraction. It operates against both the Data Factory corpus and separately stored customer documents (which don&#8217;t enter the Data Factory), with outputs evaluated for legal accuracy, context coverage, language, and structure, and automatically rerun on failure. The backend doesn&#8217;t call the engine directly\u2014work is published to a queue that the AI Engine polls, so it scales independently of the request path. It&#8217;s powered by <a href=\"https:\/\/azure.microsoft.com\/products\/ai-foundry\/models\/openai\/?wt.mc_id=legalarchtecture_azureopenai_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Azure OpenAI<\/a> and hosted in Azure Sweden Central.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Customers also configure matters, playbooks, templates, and a connected knowledge base, creating the context needed for firm-specific workflows and legal analysis.<\/p>\n\n\n<figure data-wp-context=\"{&quot;imageId&quot;:&quot;6a92fc7579be8&quot;}\" data-wp-interactive=\"core\/image\" data-wp-key=\"6a92fc7579be8\" class=\"wp-block-image aligncenter size-full is-resized wp-lightbox-container\"><img decoding=\"async\" data-wp-class--hide=\"state.isContentHidden\" data-wp-class--show=\"state.isContentVisible\" data-wp-init=\"callbacks.setButtonStyles\" data-wp-on--click=\"actions.showLightbox\" data-wp-on--load=\"callbacks.setButtonStyles\" data-wp-on-window--resize=\"callbacks.setButtonStyles\" src=\"https:\/\/www.microsoft.com\/en-us\/startups\/blog\/wp-content\/uploads\/2026\/08\/pons-architecture-diagram-v2-highres-scaled.webp\" alt=\"Diagram of the PONS architecture on Microsoft Azure. The Data Factory curates public legal sources for the AI Engine; private customer data bypasses the Data Factory.\" class=\"wp-image-5750 webp-format\" style=\"aspect-ratio:1.3313754282917278;width:680px;height:auto\" srcset=\"\" data-orig-src=\"https:\/\/www.microsoft.com\/en-us\/startups\/blog\/wp-content\/uploads\/2026\/08\/pons-architecture-diagram-v2-highres-scaled.webp\"><button\n\t\t\tclass=\"lightbox-trigger\"\n\t\t\ttype=\"button\"\n\t\t\taria-haspopup=\"dialog\"\n\t\t\taria-label=\"Enlarge\"\n\t\t\tdata-wp-init=\"callbacks.initTriggerButton\"\n\t\t\tdata-wp-on--click=\"actions.showLightbox\"\n\t\t\tdata-wp-style--right=\"state.imageButtonRight\"\n\t\t\tdata-wp-style--top=\"state.imageButtonTop\"\n\t\t>\n\t\t\t<svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"12\" height=\"12\" fill=\"none\" viewBox=\"0 0 12 12\">\n\t\t\t\t<path fill=\"#fff\" d=\"M2 0a2 2 0 0 0-2 2v2h1.5V2a.5.5 0 0 1 .5-.5h2V0H2Zm2 10.5H2a.5.5 0 0 1-.5-.5V8H0v2a2 2 0 0 0 2 2h2v-1.5ZM8 12v-1.5h2a.5.5 0 0 0 .5-.5V8H12v2a2 2 0 0 1-2 2H8Zm2-12a2 2 0 0 1 2 2v2h-1.5V2a.5.5 0 0 0-.5-.5H8V0h2Z\" \/>\n\t\t\t<\/svg>\n\t\t<\/button><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"design-decision-one-separate-trusted-knowledge-from-private-context\">Design decision one: Separate trusted knowledge from private context<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">PONS intentionally separates its public legal corpus from customer data. The Data Factory is designed to continuously collect and update public legal sources across jurisdictions. According to PONS, customer documents remain separate, and the one-directional data flow means they do not enter the Data Factory and are processed independently through the AI Engine. Each company\u2019s data remains in isolated storage and database containers within their EU-region Azure environment, encrypted in transit and at rest, with access scoped to individual users by default.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This boundary allows PONS to update and validate its legal corpus without incorporating private customer material into that pipeline. It also gives the platform a clear architectural control for demonstrating where customer data resides and preventing it from becoming part of the public legal knowledge layer.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Startups should consider this pattern when their product combines a continuously updated body of trusted information with customer-specific or sensitive data, particularly when the two require different access, residency, or governance controls. Establishing the boundary early can reduce the risk of private data becoming entangled with shared ingestion and indexing pipelines as the product scales.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"decision-two-use-managed-azure-services-to-focus-engineering-effort-on-differentiation\">Decision two: Use managed Azure services to focus engineering effort on differentiation<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">For PONS, choosing managed services was an engineering-prioritization decision: buy the undifferentiated infrastructure lift, and concentrate the team on legal-data quality, reasoning, evaluation, and customer workflows.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This principle shaped the Azure architecture. <a href=\"https:\/\/azure.microsoft.com\/products\/app-service\/?wt.mc_id=legalarchitecture_appservice_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Azure App Service<\/a> runs the application, so they don&#8217;t operate servers or hand-roll deployments. <a href=\"https:\/\/azure.microsoft.com\/products\/azure-sql\/?wt.mc_id=legalarchitecture_azuresql_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Azure SQL Database<\/a> and Microsoft Azure Storage hold structured data and customer files with EU residency pinned to Sweden Central, which makes data location a configuration decision rather than an engineering project. <a href=\"https:\/\/azure.microsoft.com\/products\/key-vault?wt.mc_id=legalarchitecture_keyvault_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Azure Key Vault<\/a> keeps secrets and certificates out of application code.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Azure App Configuration holds shared non-sensitive settings, and service-to-service connections run on managed identity, so there are no credentials to rotate by hand. Analysis work is handed off through an Azure Queue Storage rather than a direct call, which lets the AI Engine scale independently of the request path, and <a href=\"https:\/\/azure.microsoft.com\/products\/web-pubsub?wt.mc_id=legalarchitecture_pubsub_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Azure Web PubSub<\/a> pushes results and notifications back to the web application in real time.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For the AI layer, Azure OpenAI provides the foundation models, with <a href=\"https:\/\/azure.microsoft.com\/products\/ai-foundry\/?wt.mc_id=legalarchitecture_foundry_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Microsoft Foundry<\/a> hosting the fine-tuned and supporting models behind the Data Factory and AI Engine. This provides PONS with frontier capability without standing up their own model-serving stack.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The practical benefit is less infrastructure for a small team to operate. PONS can build on Azure capabilities for scaling, deployments, identity, logging, and regional configuration while directing more engineering effort toward the parts of the product customers evaluate. PONS accepted less low-level control in exchange for managed Azure services that support its requirements for regional deployment, identity, logging, and compliance evidence.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This approach is most useful when a startup&#8217;s differentiation lies in domain-specific data, workflows, or product behavior rather than infrastructure operations. Evaluate a managed service by the recurring work it removes, the controls it supports, and how its level of flexibility aligns with product requirements.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote has-quote-default-font-size is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"wp-block-paragraph\">Azure&#8217;s managed services let us focus on our customers and their needs instead of infrastructure. Scaling, deployments, identity, logging\u2014those are problems Azure has already solved at enterprise scale. We get to spend our time on the parts of the product only we can build.<\/p>\n<cite><strong>Tobias Zimmergren, CTO and technical co-founder, PONS<\/strong><\/cite><\/blockquote>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"decision-three-turn-compliance-and-security-requirements-into-enforceable-controls\">Decision three: Turn compliance and security requirements into enforceable controls<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">General counsel and procurement teams evaluate more than the AI&#8217;s capabilities. For PONS, their architecture must answer key questions, like:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li class=\"wp-block-list-item\">Where does the data live?<\/li>\n\n\n\n<li class=\"wp-block-list-item\">Who can access it?<\/li>\n\n\n\n<li class=\"wp-block-list-item\">Can the system be audited?<\/li>\n\n\n\n<li class=\"wp-block-list-item\">Will customer documents end up training someone\u2019s model?<\/li>\n\n\n\n<li class=\"wp-block-list-item\">Does this hold up across every jurisdiction we operate in?<\/li>\n<\/ol>\n\n\n\n<p class=\"wp-block-paragraph\">PONS says it addresses data location and access through regional isolation and scoped permissions. Citation-linked provenance and audit logs support traceability, while evaluation gates automatically rerun failed outputs and apply refusal-by-design when the system can\u2019t ground an answer. Customer documents don&#8217;t enter the Data Factory and aren&#8217;t used for model training. The Data Factory\u2019s legal corpus spans multiple jurisdictions and continues to expand, while the platform\u2019s isolation, access, logging, and evaluation controls provide a common technical baseline.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">PONS also cites its SOC 2 Type II, ISO 27001, General Data Protection Regulation (GDPR)-related controls, and penetration testing as important entry criteria for enterprise procurement, but the underlying requirements continue to shape the platform&#8217;s architecture and controls.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For startups building for enterprises in regulated markets, these questions are most useful when asked early\u2014while boundaries around data, access, and model behavior can still be designed into the system rather than documented after the fact. For broader guidance on preparing Azure solutions for enterprise customers, see <a href=\"https:\/\/learn.microsoft.com\/en-us\/startups\/build\/enterprise-readiness\/enterprise-readiness-intro?wt.mc_id=legalarchitecture_enterprisereadyguide_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">enterprise readiness for startups on Azure<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"explore-the-pons-legal-ai-platform\">Explore the PONS legal AI platform<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">PONS runs in production with customers across multiple EU jurisdictions, primarily serving law firms and in-house legal teams, with active pilots underway in other industries. If you\u2019re exploring how to build citation-grounded AI with security, privacy, and governance requirements in mind, you can read more about what PONS does, the platform, and the architecture behind it at <a href=\"https:\/\/pons.io\/?wt.mc_id=legalarchitecture_pons_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">pons.io<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"building-for-regulated-enterprise-customers-with-microsoft-for-startups\">Building for regulated enterprise customers with Microsoft for Startups<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">As the platform developed, Startup credits through Microsoft for Startups gave PONS the flexibility to prove out architectural decisions on real workloads while managing cloud costs during early growth. Microsoft specialists provided guidance on complex technical decisions, while timely introductions helped the team address production requirements and maintain momentum as the platform scaled.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If you&#8217;re building AI solutions for enterprise customers in regulated industries, Microsoft for Startups can help you build fast, scale smart, and sell more. <a href=\"https:\/\/www.microsoft.com\/startups?wt.mc_id=legalarchitecture_apply_blog_mfsmktg\" target=\"_blank\" rel=\"noopener noreferrer\">Get started with Microsoft for Startups today<\/a>.<\/p>\n\n\n\n<div class=\"is-style-vertical wp-block-bloginabox-theme-promotional\">\n\t\n<div class=\"promotional\">\n\t<div class=\"promotional__wrapper\">\n\t\t<div class=\"promotional__content-wrapper\">\n\t\t\t<div class=\"promotional__content\">\n\t\t\t\t\n\n<h2 class=\"wp-block-heading\" id=\"access-your-startups-benefits-today\">Access your startups benefits today<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Microsoft for Startups helps founders build fast, scale smart, and sell more. Apply today to unlock up to $150,000 in Startup credits to start building immediately.<\/p>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a data-bi-an=\"Global CTA\" data-bi-ct=\"cta link\" data-bi-id=\"cta-block\" class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/www.microsoft.com\/startups?wt.mc_id=legalarchitecture_apply_blog_mfsmktg\" target=\"_blank\" rel=\"noreferrer noopener\">Apply today<\/a><\/div>\n<\/div>\n\n\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Building AI for regulated industries requires clear boundaries around data, infrastructure, and compliance. Explore three architecture decisions behind PONS\u2019s legal AI platform on Microsoft Azure and what other startups can learn from them.<\/p>\n","protected":false},"author":1,"featured_media":5752,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ms_queue_id":[],"ep_exclude_from_search":false,"_classifai_error":"","_classifai_text_to_speech_error":"","_alt_title":"","ms-ems-related-posts":[4659,5576,5553],"footnotes":""},"post_tag":[956,19,228,999,959,996],"content-type":[201],"job-role":[],"topic":[387,734],"coauthors":[489],"class_list":["post-5748","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","tag-ai","tag-azure","tag-azure-openai-service","tag-developer-insights","tag-startups-stories","tag-technical","content-type-founder-advice","topic-ai","topic-guidance-and-development","review-flag-1750334688-375","review-flag-2-1750334680-437"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>How to build AI for regulated customers on Azure with PONS - Microsoft for Startups Blog<\/title>\n<meta name=\"description\" content=\"Explore three architecture decisions PONS made building legal AI on Azure, from data isolation to managed services and compliance controls\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.microsoft.com\/en-us\/startups\/blog\/three-architecture-decisions-behind-ponss-legal-ai-platform-on-microsoft-azure\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How PONS built AI for regulated customers on Microsoft Azure\" \/>\n<meta property=\"og:description\" content=\"Explore three architecture decisions PONS made building legal AI on Azure, from data 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