If Coke Did Christmas Dinner – The DocuSign Lexion Deal

By Richard Tromans

Yesterday, publicly listed e-signature giant DocuSign bought CLM startup Lexion for $165m, after first buying CLM company SpringCM in 2018 and doc AI pioneer Seal in 2020. But the question remains: would you buy Christmas dinner from Coca-Cola? Here’s some thoughts on the deal.

DocuSign’s e-signature capability is used by millions of people around the world, it’s the Coca-Cola of getting things signed electronically one could say. Back in 2018 it decided to move into a whole other world: contract lifecycle management (CLM) or the ‘Christmas dinner of legal tech’ in terms of its product complexity and scale.

The move around six years ago made a lot of sense. The company handled millions of contracts, albeit only the very last little bit of them, the signatures. But still, there was the reality: DocuSign was part of the contract world. What if you offered all the rest of the contract experience, with all its many parts and its complexity? In short, what if they also offered the entire Christmas dinner as well as the glass of Coke that everybody already liked?

Scroll forward to 2022, and several key people who had joined DocuSign during this first big push into CLM had left. In September of that year they also announced a 9% staff cut. Some may have believed the company’s CLM dreams were over, or at best on the back burner. After all, after six years of really going at it, DocuSign may have still been a giant of signature tech, but could it really impact CLM – a market segment now saturated with competitors both large and small, new and old?

Well, now we have the answer: they’re certainly going to try – now with the infusion of a new acquisition.

Lexion, which started in 2019 and which leading West Coast law firm Wilson Sonsini was an investor in from early on, will now be integrated with the DocuSign IAM (Intelligent Agreement Management) platform, which was launched in April this year – and which in many ways is a relaunch and updating of the previous CLM strategy.

As you’d expect with a CLM offering, this will include: ‘analysis [of] agreements to expedite contract reviews and negotiations, seamlessly locate insights within documents, and drive process automation. This includes bringing advanced document understanding capabilities to Docusign, including contract reviews, negotiation, a Q&A experience’.

It will also include Lexion AI Contract Assist, a Word plug-in and customers will be able to automatically review contracts from first and third parties for potential risks and deviations from approved playbooks. Where agreements don’t align to company standards or customized playbooks, the feature provides suggested revisions with AI-generated recommendations.

Lastly, Lexion technology will enable users to more seamlessly find information in their agreements, via the Q&A experience. ‘Imagine being able to simply ask whether a contract includes an indemnification or warranty clause and have your question answered instantly, without scrolling through the whole document,’ the company asked.

All well and good. This looks to be a solid offering that will build upon what DocuSign bought back in 2018 with SpringCM and in 2020 with Seal. (DocuSign also bought smart contract pioneer Clause in 2021 – but that is perhaps less relevant in this case. And they also invested in ML / NLP pioneer for AI redlining, BlackBoiler.)

But will this deal make a big impact? I.e. can the ubiquitous DocuSign be seen as the place to also go for the whole CLM experience, or to return to the analogy, can Coca-Cola also do Christmas dinner? Signature is vital, but helping a corporation to manage millions of its contracts, that’s on a whole other scale and demands an equally large expansion of product buy-in from the clients.


The reality is that when a very successful company made famous by one product seeks to extend its capabilities it’s always a stretch, even if they have the capital to buy plenty of targets. When one’s brand is associated with one thing, can you then sell another thing, even if what you are selling is good?

Well, let’s look at giant companies such as Thomson Reuters and LexisNexis. They both started with much smaller offerings. Thomson Reuters, or rather the original Thomson part, went from case law books, to digital research, to now offering an entire platform of legal tech tools, all integrated together. But they started with good old physical law books. They stretched and it succeeded big time.

If that’s the case, then why can’t DocuSign become a major player in legal tech as well?

A sceptic might say: but, they’ve already made a big play with this since 2018 and they didn’t take major market share off the other major CLM companies. Why will this new purchase change the equation, after all, it’s not as if Seal’s doc AI capabilities were not state of the art at the time of the deal?

An optimist might say in return: well, even major companies have to learn when it comes to entering new market segments. Lexion brings fresh talent, tech and perspectives to the CLM approach, and they will build upon existing teams that DocuSign already has.

Moreover, the global CLM market will surely keep growing, and there is no reason why they cannot expand their reach into it, despite fierce competition from myriad rival CLM companies. Plus, unlike some, DocuSign, as a $2.7 billion revenue company, has the resources to fund the growth, additional tech advances especially around genAI, and the potential ability to market this CLM capability in ways that will out-compete the rivals in the market.

As ever, time will tell which one it is. But, given that DocuSign clearly is not going to give up on CLM, and in fact is now investing heavily into it, plus the reality of its great resources, and plus its natural connection to thousands of companies via e-signature, it’s certainly got every chance of succeeding. So, perhaps Coke can do Christmas dinners after all…we shall see.

(Plus, if the new CLM push does work, then what next…? From here they can go in many other directions in the legal tech world.)

Richard Tromans, Founder, Artificial Lawyer