‘CLM Is Way Too Crowded’ – Icertis + Evisort Deal Analysis

When Artificial Lawyer shared the news that two major players in the CLM world, Icertis and Evisort, had formed a partnership, it took the world by surprise. To dig deeper into the deal, this site spoke to Jerry Ting, CEO of Evisort, and Bernadette Bulacan, Chief Evangelist, Icertis (above L and R) about what it all means, why they did it, and why the CLM world is too crowded.

First, how did this happen? Ting explains that it ‘was very spontaneous’. He found himself sitting next to the top brass at Icertis at a conference and they got chatting. Soon they realised how the two companies fitted together perfectly.

‘Icertis is good at workflows, we’re good at AI,’ Ting notes, ‘and some clients use both of us at the same time.’

In short, it was clear there was an opportunity here. One of those clients is Microsoft, for example.

Bulacan agrees that they make a great match: ‘This plays well with our platform strategy. We bring large volumes of agreements that are very data-rich, and not just from legal, but also procurement, and other areas of the enterprise. And Jerry brings the excellent AI.’

‘We focus on what we do well, and so we can drive resources into contract flows,’ she notes.

I.e. Icertis could no doubt build its own CLM-focused AI capability that eventually would compete with other leaders on the legal AI front, but it would cost a lot, take time, and leave them still competing versus companies such as Evisort that would have a big head-start. It makes more sense to work together and put their cash where they are already very well known.

For Evisort it potentially increases their client reach a lot. Icertis is not just doing legal, as noted, they work across all of a company’s departments. They also integrate with a company’s range of other data flows, from ERM to accounting info from SAP.

Because of their size and time in the market – they are 15 this year ­– they’ve also built relationships across the Fortune 500. They also have 2,100 people globally. Evisort has about 200.

Bulacan also points out that Icertis has been using a partnership model for many years too. They have had deals with Accenture, Deloitte and others. In short: it all makes sense to Icertis.

The Merger Question

AL has to ask. What next, a merger?

Ting focuses on the fact that they will be doing joint bids for work with the clients. They will go to market as partners. They will split revenue from the work. And the word ‘partner’ is emphasised once more. I.e. this is not a merger.

But, where is this heading? Ting notes that the plan is to ‘touch 50 to 100 customers together’. Beyond that he can’t say.

Reading between the lines it’s clear that neither side knows for sure what will happen, but they are going to give it their best shot. And hence, any talk of anything more than this partnership is academic, as they need to see if this joint approach will work sufficiently first to meet their goals.

‘We are still learning, we are having fun getting to know each other,’ Ting says and then adds, ‘we are in five deals together at the moment.’

Plus, he notes that consulting groups that work with Icertis are very keen on the deal and have been in touch already. So, all good so far and no need to think about ‘what next’, at least not yet.

But, Why Now?

All well and good, but why now? Ting says it clearly: ‘Market change is part of the reason. CLM is way too crowded. We do not need 25 small CLM vendors. We need leaders in the space. We need to rationalise. The customers are confused.’

He notes that the challenge is that some companies in the CLM space, or perhaps cutting across it, are just ‘widgets’ doing one small part of the platform task. Icertis is a leader on offering a total platform to multiple sectors, he reminds this site. Add in Evisort’s AI, and voila, you have what the clients want. Or at least that’s how this new partnership argues their case.

We swallowed our egos and decided to be the best at what we do for the customers,’ Ting concludes.

Bulacan wraps things up by saying that in a world that now has so much contract data, across not just legal, but multiple work streams, then customers need this kind of deal: great workflows and experience working across the enterprise, with the data-crunching AI that Ting and colleagues can provide. That’s the message, and this site has to say it’s a compelling one.

Plus, for Evisort to grow to Icertis’s size would take many years of growth and massive amounts of fresh funding. For Icertis to build what Evisort has, with its expertise in AI in an era of LLMs working alongside older, established ML systems….that would be a big step. In short, it’s a win-win for all involved, for the two companies and the clients.

For the wider CLM market it’s another challenge to contend with. Add this to DocuSign buying Lexion for their refreshed new thrust into the CLM world; then add in how genAI is making it easier for a mass of smaller, new companies to enter the field of doc review very quickly; then add in funding challenges for those that got a ton of cash back in 2022; and you have an environment ripe for a shakeout and more consolidation.

With this deal Icertis and Evisort are making sure they are on the right side of this history. Good luck to them.

If this subject is of interest then come along to the Legal Innovators California conference on June 4 and 5 in San Francisco. Tickets are available now.

Legal Innovators California conference, June 4 + 5. 

The event will take place in San Francisco with Day One focused on law firms, and Day Two on inhouse and legal ops.

We have many great speakers, along with a group of pioneering legal tech companies and service providers – you can see some more about our speakers here. It will be two great days of education and inspiration! Join us! 

For ticket information, please see here. Come along to what will be a great event in San Francisco focused on how the legal world is changing.