Note: This article was updated post-publication with comments from DocuSign
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The companies are certainly not strangers to each other, considering DocuSign strategically put $15 million into Seal last March. Since it was founded in 2010, Walnut Creek, California-based Seal has raised a total of $58 million in venture funding. Prior to the corporate round raised last year, Seal’s most recent financing was a $30 million capital infusion from Toba Capital.
DocuSign also has been reselling Seal’s flagship analytics and machine learning application as part of DocuSign Agreement Cloud, a suite of applications and integrations designed to automate “the entire agreement process.”
“The news marks DocuSign’s next bold move in AI and cements the company’s path to digitally transform the foundation of doing business: agreements and agreement processes,” DocuSign said in its press release. “With the acquisition, DocuSign has firmly made a bet on AI as the future of agreements and will now integrate Seal’s technology, which makes finding, analyzing and extracting data from contracts simpler and faster, more comprehensively across the Agreement Cloud.”
Once the acquisition has closed, San Francisco-based DocuSign plans to continue to sell Seal’s analytics application. It will also integrate Seal’s AI technology to augment DocuSign CLM, its contract lifecycle management solution.
Chief Operating Officer Scott Olrich said DocuSign has more than 3,700 employees. Seal Software has around 240 employees, about half of whom are in the United States.
“Given our history of reselling Seal Software’s agreement analytics solution—and our broader vision to help companies automate their entire agreement process—we knew that AI would play an increasingly important role in the future,” Olrich wrote via email. “By acquiring Seal, we can now integrate its AI technology across our entire solution suite, and we can benefit from their deep technology expertise, and their broad experience applying AI to agreements.”
The companies claim that incorporating AI into the contracts and agreements process helps save time and money. For example, they point to “a large international information-services company” that “reduced the time spent on legal reviews by 75 percent thanks to DocuSign and Seal technologies.” Another customer, they claim, reduced the legal review time on customer agreements by more than 80 percent.
In December, DocuSign reported third-quarter fiscal 2020 revenue of $249.5 million, up 40 percent year over year. Subscription revenue was $238.1 million, an increase of 41 percent year over year while professional services and other revenue was $11.4 million, an increase of 28 percent year over year. Its generally accepted accounting principles net loss per basic and diluted share was 26 cents on 178 million shares. But its non-GAAP net income per diluted share was 11 cents on 191 million shares outstanding compared.
Illustration: Li-Anne Dias