DocuSign acquires ‘smart agreements’ startup Clause

Electronic signature provider DocuSign has acquired one of its key partners, Clause, alongside its intellectual property assets and staff, in order to integrate its technology into a broader cloud-based smart contracts platform.

Clause, which was founded five years ago, develops systems to assist digital contractual agreements, such as user verification and industry-specific services such as real-time, data-driven insurance contracts.

DocuSign, which has previously collaborated with Clause on developing digital contract technologies, will integrate the startup's broader technology portfolio into its own Agreement Cloud platform. This system aims to elevate digital contracts from photos of paper documents into 'living documents' with interactivity and digital functionality.

"It is a compelling and exciting frontier of technology, and it's an important enabler of making our Agreement Cloud smart," said DocuSign CTO, Kamal Hathi. "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.

"Its products already integrate tightly with DocuSign eSignature, and we're exploring deeper connections to contract lifecycle management (CLM) too."

The company is also keen on integrating Clause's services for various industries, including financial services, health care, and insurance companies, into its Agreement Cloud.

Among the features included in the latest release of Agreement Cloud are eSignature compatibility with Microsoft Teams and an eWitness feature that allows contract signers to include up to two witnesses per signer in the signing process.

Clause has been working closely with DocuSign to develop "groundbreaking capabilities" in contracting technology for the past two years, its founder Peter Hunn, said. This led to the conclusion that the scale and distribution of DocuSign would complement the innovations developed by Clause, with the two companies being a perfect fit for one another.

"The opportunity in front of us is to deliver Smart Agreements to the world, leveraging best-in-class eSignature and CLM products, as part of one of the largest tech companies," Hunn said.

"The Clause team will continue our work within DocuSign to deliver on our shared vision for smart agreements—a development that will fundamentally change the future of contracts, just like word processing and eSignature."

DocuSign has also been a keen investor in the startup, having led Clause's Series A funding round of $5.5 million in 2019. The financial details of this acquisition haven't been disclosed publicly, however.