The new contract management product is the result of Conga's purchase last year of CLM specialist Novatus, as part of a growth strategy developed after private equity investor Insight Venture Partners took a controlling stake in Conga. Speaking to diginomica about the latest news, Chief Operating Officer Bob DeSantis says the company had seen an opportunity for a CLM offering as soon as Salesforce announced the Steelbrick acquisition.
A benefit of the Novatus acquisition was to take that IP and refactor it onto the Salesforce platform as a native solution.
Even a year and a half ago, we believed we saw a gap in the market. CPQ traditionally has been very complex. What Steelbrick did was brought it down and made it useable by SMBs all the way through to enterprise.
We looked at that and we saw, there is no CLM on the platform that can just drop in after CPQ and carry on the process. We saw an opportunity to go after what Salesforce call the commercial business, and try to fill that gap with a product that's designed to fit into the space between CPQ and electronic signature and our partnerships with Docusign and Adobe.
What we wanted to come out with was a Steelbrick-scale form of CLM.
Focus on sales
Conga Contracts has been very well received in the market, says DeSantis:
We believe that solves a gap in the market. Four weeks after launch we have 15 net-new customers and anticipate growing that into hundreds of customers over the next few quarters.
The first release includes two editions. Negotiator Edition provides the basic functionality of agreement redlining and a feature called true-up, which automatically reconciles Salesforce data with the final contract terms. For those wanting more, Business CLM Edition adds a range of traditional contract management functions such as standard clauses, progress tracking and analytics. There will be more to come in future releases, says DeSantis, including an enterprise edition that will start to make use of machine learning.
Conga Contracts will also work for customers who don't have the Salesforce CPQ tool, in particular those who use Conga's flagship mailmerge workflow product Composer. Many are already using Composer as part of their contract workflow, says DeSantis — last year almost four million documents created in Composer included the words contract, agreement or equivalent language.
Conga Contracts is focused solely on sales contracts rather than the wider spectrum of legal contracts handled by the original Novatus Enterprise product, which continues within a separate business unit. But the plan is to converge this product with an enterprise edition of Conga Contracts over the next twelve months, says DeSantis.
Validation and velocity
The Salesforce investment is a welcome boost for Conga, DeSantis believes:
First and foremost it's a validation of our strategy. We've been working for two years to take Conga Composer and include other capabilities and a broader sweep of functionality.
It's allowing us to double down on our velocity and speed and allow us to do what we've already been doing, faster.
But it doesn't imply any closer endorsement by Salesforce than Conga already enjoys, he adds:
Ultimately customers and the Salesforce ecosystem align around those products that deliver value. We've been very successful without having Salesforce as an investor, I don't see this will make any step change in that.
In fact, achieving the top Platinum level as a Salesforce ISV in late 2015 has been more instrumental in helping to build relationships with the Salesforce sales team and with others in the ecosystem:
That's allowed us to engage much more closely internally within Salesforce and with other partners. That's certainly paid off.
The advent of Salesforce Quote-to-Cash has been an important factor in the recent rejuvenation of sales growth for the flagship Salesforce Sales Cloud, and Salesforce CEO Marc Benioff cited the Steelbrick acquisition as an important contributor to organic growth when he spoke to analysts after last month's earnings announcement.
So it should come as no surprise that Salesforce is investing in partners that help round out its offering and further boost those sales. Other Salesforce Ventures investments in the QTC ecosystem include a $7 million stake in consulting partner Simplus, which specializes in quote-to-cash, and $20 million in B2B digital commerce platform CloudCraze.
This latest investment shows that Salesforce values the extra clout that partners can add to its QTC offering, and demonstrates a determination to maximize its reach in this market.