Sramana Mitra: What does an enterprise account look like for you?
Ulf Zetterberg: Enterprise accounts are very distributed and fragmented. It could have two or three fairly old legacy data sources. It could be that the applications have been there for five to ten years. The usability and transparency is very poor. It’s a big project for them to try to find information and know how to extract the right information from each contract. One of the use cases that clearly puts this in the center is M&A. When you acquire a company and integrate that or you make a divestiture, it’s probably more troubling for many large companies, because now you need to know what contracts should go with that divestment.
That’s usually done manually, so it’s very time consuming and expensive. Even if you have off-shore capabilities to just manually review and search, it adds up because these are days where you have 20 to 50 people working at this for months. It’s time consuming and there’s still the question of whether you have captured all the information. M&A is a great use case to illustrate how big the problem is. The other use case is in deploying new applications particularly in contract lifecycle management, procurement system, or CRM system.
Sramana Mitra: In terms of deal sizes, are we talking of hundred thousand dollars a year kind of deals?
Ulf Zetterberg: I would say we’re talking about $250,000 to $750,000. They’re typically three to five-year contracts.
Sramana Mitra: How many customers do you have now?
Ulf Zetterberg: We’re getting close to 100 customers.
Sramana Mitra: They’re all enterprises?
Ulf Zetterberg: Yes.
Sramana Mitra: What percentage of the enterprises now have a contract lifecycle management system in place?
Ulf Zetterberg: I think most of them have a system, but it’s highly departmentalized. From the Fortune 2000, everybody has at least one system. That’s the problem. Most of them have multiple systems that don’t communicate with each other. From an enterprise-wide perspective, they don’t have a way to query all the contracts to find specific relationships or look for specific legal language. They have multiple systems and they have different maturity in the implementations. That’s one of the big problems for the enterprises.
Sramana Mitra: How do you see this all playing out if you were to project five to ten years out?
Ulf Zetterberg: I think it’s larger than that. I think this is part of the next generation of unstructured data management. There’re so many unstructured data contractors today. You can draw parallels to how the BI industry creates more transparency and visibility on the structured side. You’re going to see analytical applications like ourselves coming into the space and attacking this unstructured data. The driver is just customers on the back-end of the Big Data and cloud trend. The purpose is not to collect all data. It’s just finding that golden nugget or those correlations that really make a difference. That’s very hard on unstructured data.