So assuming you’re charging for the contract management piece, who is the target customer (and how much do you charge)? Or do you provide some other value that I’m not seeing?
Small startups don't need contract management until they reach a point and then they wish they started doing it from day 1. :)
"hyper-standardized contracts" I suggest you take a look at the app! While our terms are immutable, the contracts can be heavily customized. So instead of hunting down a random word in a PDF you can focus on the things the material changes from agreement to agreement.
Full details on pricing here: https://commonpaper.com/pricing/
Our target customers are B2B SaaS companies, and our goal is to have them start using us when they are small on the free version and grow with them.
I agree that the bigger entities are the hardest ones to get onboard with this, but our users have signed contracts with Fortune 500 companies and large universities, including deals for hundreds of thousands of dollars. It's actually in the cases where there's a big mismatch in size that we can provide the most help, although there are plenty of cases where the big company draws a hard line and won't use anything but their in-house contract.
One question: how do you make sure that all of the different allowable options make sense together? For example, I see a governing law option. Can you only select from a few, pre-vetted options? What if someone selects a jurisdiction whose governing law isn’t compatible with other provisions in your contract (for example, termination terms or indemnification)? You wouldn’t want to give your customers the sense that they can play with terms like Lego blocks and be guaranteed that the result is something sensible, if this is not the case.
One thing I'll note is that we do support importing contracts on customer paper / or deals executed outside our system. We only have a subset of our features for those, but all of your contracts can be together in the same system.
On the options making sense together, the standard agreements are created by 40+ attorneys specializing in tech law and commercial contracts. They design our contracts to reflect what is industry standard with a focus on creating a fair and balanced starting point. That being said, each company chooses how they want to configure their own cover page. We provide tooltips and help articles on what the terms and variables mean, and companies can work with their attorney to set it up initially or include them in the workflow. We can intro our users to attorneys who are familiar to with the standards and do good work.
If the pitch is that it would save money on legal fees, then that could be a big value add. But if that's the angle, then my last question, regarding whether the docs are meant to be closed-universe and vetted, or open-universe and not vetted becomes critical. Founders wouldn't want to be changing options around and not realizing that they are creating confusing or unexpected results.
If they're supposed to still use a lawyer, then that blunts the value add (and the lawyer would likely resist the standardized agreement because it means fewer billable hours). But maybe you can get enough critical mass to be an 800-lb gorilla, like the SAFE has become? I appreciate the quick responses here, and am taking a look at the agreements to see if they could be relevant for our business.
By making contract review and negotiation faster, we speed up your sales cycle and grow revenue faster. Faster sales cycles mean that you get paid faster, which in turn means that you can recycle cash into new customer acquisition investments and grow faster. We wrote a blog post about the math of how sales cycle speed translates to revenue growth here: https://commonpaper.com/blog/impact-of-accelerating-sales-cy...
Some of our users work with attorneys, and some do not. For the folks who do work with attorneys, we still make those relationships more efficient because the scope of negotiation is more narrow. As a simple example, if the attorney helps the founder understand the implications of increasing or decreasing a liability cap, it's straightforward for them to apply that info on their own for many deals in the future. With traditional bespoke contracts, if they see a bunch of redlines to a paragraph about liability, it's much harder for them to reason about whether or not this is safe to sign.
We try to help users understand what sort of information tends to go in each variable, but we stop short of providing customized advice. So we can help people understand that a liability cap might be a fixed number (eg $1 million), a multiple of fees paid (eg 1X the last 12 months fees), or unlimited. But we can't advise them on whether or not their particular company should take the risk of a particular level of cap in order to close a particular customer. That's the sort of thing they should talk to an attorney about.