Stock Market Analysis

5 Things You Didn’t Know About DocuSign

From simple notary services to complex artificial intelligence-driven contract analysis tools, this e-signature specialist is innovating to drive growth.

This article originally appears on The Motley Fool, written by Brian Withers.

DocuSign (NASDAQ:DOCU) has built a $1 billion annual revenue business from subscriptions to its e-signature service starting as low as $10 per month and has handed shareholders incredible market-beating returns since it went public in April 2018. 

DOCU Chart
STOCK PRICES FROM APRIL 27, 2018 TO MAY 20, 2020. DOCU DATA BY YCHARTS.

Amazingly, management thinks they’ve only tapped about 1% of the company’s potential customers and is investing heavily to build on its foundational technology in ways you might not have heard before.

Let’s check out five ways DocuSign’s development efforts could power growth in the coming years.

1. It’s integrated with the software giants 

DocuSign knows that an e-signature by itself is a time-saver, but integrating it into the platforms people use every day is game-changing. The company has built more than 350 integrations with the largest software players from Apple (NASDAQ:AAPL), Google (NASDAQ:GOOG), Microsoft (NASDAQ:MSFT) and Salesforce (NYSE:CRM) to make sure its core technology is darn near ubiquitous.Logos from six large software companies that DocuSign integrates with: Salesforce.com, Google, Apple, SAP, Microsoft, and Oracle

IMAGE SOURCE: DOCUSIGN.COM

System integrators and representatives from these software giants are helping to expand its reach into more customers and more applications.

2. E-signatures are just the beginning 

In the life of an agreement, the e-signature part is probably the shortest and least time-consuming part of the process.

From the creation process on the front end to acting on the contract and managing the terms on the back end, managing agreements can be administratively tedious. With the $220 million purchase and software integration of SpringCM, a contract lifecycle management platform, DocuSign’s Agreement Cloud subscription service can now manage all aspects of the life of an agreement electronically.

Just look at our returns versus that of the S&P 500! Click here to learn exactly how we continue to beat the market, and the the list of stocks we think will turn out to be the next Amazon, Tesla, or Netflix!

Between a Gartner Magic Quadrant leader commendation and big-name customers such as Facebook (NASDAQ:FB), Aetna, and Lenovo, this contract lifecycle product suite has the credibility and momentum to tackle a huge $25 billion market.

3. It’s into artificial intelligence

Earlier this year, DocuSign acquired Seal, a contract analytics and artificial intelligence technology provider, for $188 million in cash. It had already made a $15 million strategic investment with the company and was reselling its core offering as DocuSign Intelligent Insights, so it wasn’t a big leap for the e-signature specialist to add it to its roster.

Seal enables smart search and detailed analytics for customers with a large number of contracts, even if the documents are photo images or Adobe (NASDAQ:ADBE) PDFs. DocuSign is planning to integrate these powerful features across its Agreement Cloud subscription, which will strengthen the offering and make it more attractive for enterprise customers.

4. It can help sell houses and more

The company even has some focused industry solutions, two of which are centered on the house-selling process. Its Rooms for Real Estate and Rooms for Mortgage products create a collaborative space in the cloud for the homebuyer and their agent or mortgage administrator. The tools have workflows, task lists, document upload/storage capabilities, and of course, e-signatures to enable a house sale and subsequent mortgage process to run in a structured and transparent way for all parties involved. In addition, there’s a separate e-notary module available in 23 states to enable any notary-required signatures to be completed online.

For the medical device and pharmaceutical industries, it offers an enhanced e-signature product that meets all of the rigorous FDA documentation requirements for electronic records and is used by many of the top companies in these verticals. 

These product extensions are great examples of how DocuSign is able to expand on its core technology to create unique industry and product solutions for more customers.

5. It’s building a dedicated data center

Landing the U.S. government as a customer can be a big win for any company, but it usually comes with a long list of requirements. For cloud providers, a standard called the Federal Risk and Authorization Management Program (FedRAMP) details all the requirements around confidentiality, integrity, and availability that software vendors need to meet in order to process four graduated levels of sensitive government information.

Take on our Get Started Challenge to become a fully-fledged investor in just 7 days!

Today, DocuSign has been authorized for three of the four levels, and it’s building a dedicated data center to be completed in 2021 to help qualify for FedRAMP’s highest level. This authorization would give it the ability to serve agencies dealing with highly sensitive information such as the Department of Defense, Veterans Administration, or Department of Homeland Security.

CEO Daniel Springer commented on the benefits of achieving end-to-end FedRAMP authorization in a recent interview and said that “the opportunity is huge. I think the growth is going to be substantial for us.”

The bottom line for investors

Even though e-signature technology has enabled DocuSign to become a household name, this 17-year-old company is not resting on its past success. Investors should know about the numerous investments in software development and smart acquisitions that are opening up more opportunities to serve more customers in new and valuable ways. This passion for innovation is just one of the reasons I like DocuSign as a long-term investment. 


MyWallSt operates a full disclosure policy. MyWallSt staff currently hold long positions in companies mentioned above Read our full disclosure policy here.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Brian Withers owns shares of Alphabet (A and C shares), Apple, and DocuSign. The Motley Fool owns shares of and recommends Alphabet (A and C shares), Apple, DocuSign, Facebook, Microsoft, and Salesforce.com and recommends the following options: long January 2021 $85 calls on Microsoft and short January 2021 $115 calls on Microsoft. The Motley Fool has a disclosure policy.

The Motley Fool
The Motley Fool
The Motley Fool has been one of the industry's experts for years and is one of our contributors here at MyWallSt.