As predicted by Artificial Lawyer, DocuSign is to acquire smart contract pioneer Clause. The deal will see DocuSign gain Clause’s IP, with its team, led by Peter Hunn, the co-founder and CEO, moving over to the far larger esignature company to be part of its Agreement Cloud group.
The company also said they will be focusing on expanding into the CLM segment of the market.
Hunn told this site: ‘We’re delighted to join forces with DocuSign. Clause is a pioneer in smart agreements and together we are able to execute on a shared vision for the future of contracting.’
And here is a statement from DocuSign that was also sent to Artificial Lawyer: ‘DocuSign and Clause have been close partners for several years and the company’s products already integrate tightly with DocuSign eSignature. With the acquisition, DocuSign is exploring deeper connections to contract lifecycle management (CLM) and will leverage Clause’s experience developing specific solutions for financial services, insurance and healthcare companies to complement the Agreement Cloud.’
There is also an additional, and much longer comment, from DocuSign’s CTO Kamal Hathi. It is below.
Is this a big deal? Probably in financial terms it was not a huge deal, it’s also the end of Clause – the pioneer of the smart contract segment of the legal tech market – as an independent company.
But, for DocuSign it is a very important step, and perhaps in the hands of this much larger company Hunn’s vision of coded contract terms executing inside the document, and contracts becoming ‘living’ and ‘active’ records that connect to the external world, could actually be a lot closer to being achieved.
For more on DocuSign’s vision, see below. (It’s a bit late over here in London, so more comment from Artificial Lawyer tomorrow.)
Overall, it’s the end of an era, and perhaps the beginning of a new one for complex smart contracts.
DocuSign’s CTO Kamal Hathi – Comment on the Clause deal.
‘As we have evolved the DocuSign Agreement Cloud platform over the past few years, we have paid particular attention to how agreements are evolving from static digital documents—simple “pictures of paper”—into living documents which include functionality that adds value throughout the agreement process.
Often known as “smart agreements”, they incorporate computer code and smart clauses that effectively bring agreements to life—connecting different computer systems together, enabling actions to be taken automatically, and helping business to get done faster, more cost-efficiently, and with lower risk.
It could be checking that the bank account details in a contract are correct, or that an internet service provider is meeting its uptime regulations. It could also be about solving problems—i.e. preventing the contract from being signed if those account details are wrong, or initiating a claim if the ISP misses its targets.
It is a compelling and exciting frontier of technology, and it’s an important enabler of making our Agreement Cloud smart. It’s against that backdrop that DocuSign has entered into a definitive agreement to acquire the IP rights and hire the team from one of the industry’s smart agreement pioneers, Clause.
Clause is a close partner of ours already, and we joined its Series A funding round in 2019. The company has built a smart agreement platform that enables and automates the actions mentioned above–such as sending notifications, running compliance checks, and sending contract status updates.
Its products already integrate tightly with DocuSign eSignature, and we’re exploring deeper connections to contract lifecycle management (CLM) too. In addition, Clause’s experience developing specific solutions for financial services, insurance, and healthcare companies complements the way the Agreement Cloud helps many of our customers.
It’s for all these reasons that bringing Clause into the DocuSign fold makes sense. The majority of the team will move over to our platform engineering team, thereby adding some unique technical expertise and a breadth of capabilities that align well with the future of the Agreement Cloud platform. We look forward to welcoming the Clause team into DocuSign.’