As DocuSign supposedly considers selling to non-public equity and takes over the company itself.
on Monday, DocumentDocuSign (which now prefers to make use of a lowercase “S,” a company PR representative tells me) announced that it is buying Lexion, a contract workflow automation startup, for $165 million. The purchase comes as DocuSign continues to speculate more in the contract management space, which recently launched DocuSign Permissionsa service aimed at combining various elements of the strategy of creating and negotiating a corporate contract.
Lexion was incubated at the Allen Institute for Artificial Intelligence (AI2), the artificial intelligence research arm of the nonprofit Allen Institute. Gaurav Oberoi founded the company with former Microsoft research engineering and software development executive Emad Elwany and engineering veteran James Baird; Oberoi previously co-founded the survey platform Precision Polling, which SurveyMonkey acquired shortly after its launch.
Lexion began as an “intelligent” contract repository, allowing legal teams to ask questions about documents in natural language. However, it has slowly expanded to incorporate tools that address different use cases and document creation challenges for teams not only in legal, but also sales, IT, HR, and finance.
Prior to the acquisition, Lexion raised $35.2 million in enterprise capital from investors including Khosla Ventures, Madrona and Point72 Ventures.
According to DocuSign CEO Allan Thygesen, Lexion’s technology will enable DocuSign customers to achieve a “more granular” understanding of contract structures and data, in addition to higher discover insights and potential threats. DocuSign will leverage Lexion’s AI models to create contracts and negotiate, while Lexion will build integrations with DocuSign products and solutions.
The purchase comes at a key time for DocuSign, which is valued at about $12.5 billion, which is reportedly in the strategy of being sold to a private equity firm. Perhaps in a bid to make its books more attractive to suitors, DocuSign announced plans in February to put off ~6% of its workforce, or about 400 jobs.
In January, Reuters reported that Bain and Hellman & Friedman were among the final bidders in the DocuSign auction, which could possibly be one of the largest leveraged buyouts of 2024.
DocuSign’s other acquisitions include SpringCM (in July 2018 for $220 million), a cloud platform for sales contract management, and Seal Software (in February 2020 for $188 million), a company specializing in artificial intelligence-based contract analytics.