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For lawyers and the organizations that employ them, time is literally money. The business of contract management software is to help streamline this process, reducing the time and money needed to understand and manage contracts.
It turns out there’s a lot of money in the contract management software market, too. The use of AI-powered automation is increasingly becoming an integral part of business. To that end, contract management provider Evisort today announced that it has raised $100 million in a series of Series C funding rounds, bringing total funding to date to $155.6 million. of dollars.
Evisoft was founded in 2016 and raised a Series A round of $15 million in 2019. The company was founded by a team of researchers from Harvard Law and MIT and discovered early on that there was a market opportunity for the use of AI to help improve the contracting workflow within organizations. .
“If you think about it, every time a company sells something, buys something, or hires someone, there’s a contract,” Evisort co-founder and CEO Jerry Ting told VentureBeat. “Contract data is really everywhere.”
Contract management is a growing market
Evisoft fits perfectly into a market that analysts often call contract lifecycle management (CLM). Gartner Peer Insights lists at least twenty vendors in the space, which includes both startups and more established vendors.
Among the big vendors in the space is DocuSign, which entered the market with a bang in 2020 with its $188 million acquisition of AI contract discovery startup Seal Software. Startups are also making progress, with SirionLabs announcing this week that it has raised $85 million to help add more AI and automation to its contract management platform.
According to several reports, the global contract lifecycle management market is expected to witness significant growth in the coming years. According to Future Market Insights, the global CLM market in 2021 generated $936 million in revenue and is expected to reach $2.4 billion by 2029. MarketsandMarkets provides a more considerable figure, with the CLM market expected to reach 2.9 billion by 2024.
Ting commented that while every organization has contracts, from this perspective, many organizations still do not manage contracts with a digital system and rely on spreadsheets and emails. This is one of the main reasons he expects to see significant growth in the CLM space as organizations realize there is a better way to manage contracts.
Integrating AI to Advance the State of Contract Management
Evisoft’s flagship platform uses AI to read contracts which users then upload to the software-as-a-service (SaaS) based platform.
Ting explained that his company had developed its own algorithm to help improve natural language processing and the classification of important domains in contracts. These areas could include the terms of an agreement, such as time frames, rates, and other terms important to a lawyer analyzing a contract. Going further, Evisoft’s AI will now also analyze the legal clauses of an agreement.
“We can actually extract the relevant data from a contract, instead of a human having to enter it into a different system,” Ting said.
Once all contract data is understood and categorized, the next challenge organizations face is what to do with all the data. This is where the other key element of Evisoft’s platform comes in, with a no-code workflow service. The basic idea of the workflow service is to help organizations collaborate on contractual activities, including review and approvals.
What $100M investment in AI will do for Evisoft
With the new funding, Ting said his company will continue to expand its marketing and sales efforts. Evisoft will also invest in new AI capabilities that Ting hopes will democratize access to AI for contract management.
To date, he has explained that Evisoft’s AI operates somewhat autonomously based on definitions created by Evisoft. With future versions of the platform, Ting wants to allow users to take Evisoft’s AI and tweak and train the algorithm for specific, personalized needs. The plan is to combine Evisoft’s no-code capabilities with future functionality, in an approach that will allow regular users, not just data scientists, to build AI capabilities to better understand and manage contracts.
“I think the $100 million mark tells the market, hey, this company is a serious player and they’re here to stay,” Ting said. “It’s a scale-up, not a startup.”
The new funding round was led by TCV with participation from Breyer Capital as well as existing investors Vertex Ventures, Amity Ventures, General Atlantics and Microsoft’s M12 venture capital fund.
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