Six-year-old Seal Software has probably been flying under your radar, but in that time it has been quietly acquiring a who’s who of giant customers like Aetna, Microsoft, Salesforce, and Google.
A person close to the company tells us that Seal Software is considered one of the “most exciting” young enterprise tech companies because it has invented a new category of software called “contract analysis.”
Seal creates a central place to store all of a company’s contracts and then uses machine learning and AI to search for, understand, and even interpret the legalese so that mere mortals can understand, CEO Ulf Zetterberg tells Business Insider.
The company is becoming both a proving point for machine learning technology and a secret weapon among huge companies for reducing their legal costs. It helps them fight lawsuits, save money with suppliers, and protects them from some of the draconian terms that vendors (such as software vendors) like to sneak into contracts.
It also helps companies fight price increases that happen when a big software company buys a smaller company and then tries to raise prices on the acquired customers.
“One of the scary things in the software industry is ‘most favoured nation pricing,’ a term that always gives the customer the best pricing,” explains Zetterberg. This is something that a salesperson will frequently promise when making the deal, but in the contract “it’s never written in a way that you can easily find it. It is usually hidden in the price provision of the contract.”
Zetterberg says he knows of two cases where Seal users stopped a big software vendor from raising prices after an acquisition by locating that “favoured nation” clause in their original contracts.
The product is so useful that even Google is using it to store, track, and search all of its contracts. This even though Google offers its own enterprise search product (Google Search Appliance) and famously has its own machine learning and AI technology, known as Google Brain.
Votes of confidence like Google’s is why Seal is “growing like Oracle did in the early days, doubling each year,” one person close to the company tells us.
Seal Software, which raised $13 million in venture backing, has been doubling its customer base each year, Zetterberg says. It now has 125 customers, and each customer has also been doubling how much it spends with the startup each year, with the average customer now spending $250,000 to $350,000 annually, he says.
Seal sells its software via a subscription, charging based on how many contracts are being stored and searched.