Why we invested: Icertis
This article was co-authored by Founding General Partner Kabir Narang and Principal Aakash Tulsani
Contracts define a business — what it buys, what it sells, how it runs. Yet organizations often lack a centralized system to easily create and manage these strategic assets, let alone handle the nuanced complexities of contracts like tracking clauses that generate business value or mitigate risks.
Our research indicates that, despite major innovations in other areas of organization management, many companies continue to manage contracts using spreadsheets, shared drives and even physical filing cabinets. These systems do not support contract analytics, making it impossible for companies to leverage these contracts to manage risk and compliance or derive additional value.
Increasingly, organizations are seeking intelligent and comprehensive contracting solutions that help with regulatory compliance, faster authoring, negotiation, and sign-off cycle times, and that work across all contract types (buy, sell, legal). In addition, advancements in Artificial Intelligence make it possible for contract tools to identify risks and implications across the overall contract portfolio smartly.
On account of its ability to deliver operational excellence, speed, and compliance, contract lifecycle management (CLM) has emerged as a must-have technology for companies regardless of size or location. CLM is a $20 billion industry and is growing at 30%+ every year. We believe that CLM is the next big horizontal enterprise category with applicability across industries and departments.
This is one of the reasons we invested in Icertis, a company that has grown to become the leading SaaS provider in contract management. Founding General Partner Kabir Narang first met the company in 2014 and led the Series A round in his previous fund. At B Capital Group we led the Series C round, followed by leading the Series E, and most recently, the Series F round.
Icertis has built a global presence in the CLM category and counts the world’s most iconic brands and disruptive innovators as customers. They currently manage 10 million contracts and service customers in 90 countries and 40 languages.
The company has been capital efficient and has built a premier platform with strong technology and category-defining innovation. Due to the nature of contracts, Icertis’ usage spans across departments — Finance, Procurement, Sales, Compliance, Legal — and across all industry verticals, with a strong presence in retail, technology, pharma, and manufacturing.
Over the years, we have seen Icertis setting the pace of innovation in the CLM category. It has a flexible platform that integrates well with other sell-side and buy-side solutions like Microsoft Dynamics, Salesforce, Coupa, and SAP Ariba, to name a few. Its powerful AI has earned it a spot on Forbes’ AI 50 list two years in a row — the only CLM company to achieve this distinction. And it has been recognized as a category leader by every major analyst, including Forrester and Gartner. Most recently, in its CLM Wave report that surveys all of the top vendors, Forrester positioned Icertis as the clear leader by virtue of having both the strongest current offering and the strongest strategy in the market.
Icertis has shaped the category over the last few years and increasingly uses AI/ML to make contracting processes more intelligent, collaborative, and agile.
Its product strength is reflected in its strong metrics. It has a high landing contract value which expands rapidly. There is low churn of customers as it is a core part of their business workflow across departments.
The COVID pandemic underscored why CLM is a critical system of intelligence for companies and allowed Icertis to emerge as a positive and clear solution during an uncertain time. Icertis’ customers maintained business as usual while quickly surfacing pandemic-related clauses from across their organizations to assess their economic and operational impact — empowering them to respond immediately to rapidly evolving circumstances. This was a strong validation for us that Icertis provides its customers with mission-critical software.
The strong positive feedback from customers has been a consistent theme for the Icertis platform over the last several years. During our diligence, a Fortune 500 manufacturing firm acknowledged Icertis as a critical component of its supply chain operations, helping them to improve supplier evaluation/contracting while increasing business velocity and compliance.
A critical aspect to the scaling of Icertis has been its people and its strong values and culture. The company has an incredible team and an empowering culture using its “FORTE” values framework: Fairness, Openness, Respect, Teamwork, and Execution. Whether big or small, every decision, is done by keeping this as the north star and guiding philosophy. Icertis’ strong values driven culture has it attract incredible talent across all levels. Most recently, the company added two highly distinguished leaders as independent Directors to the Board — Penny Pritzker, Founder and Chairman of PSP Partners, and Karyn Smith, general counsel of Twilio Inc.
Icertis has built a mission-critical contract intelligence platform that allows organizations to transform their contracts into a strategic advantage. It’s been an absolute privilege to be part of Icertis’ journey to become the contract intelligence platform of the world, and we are excited to deepen our partnership with this amazing company.