Icertis announced that it has secured $150 million in funding comprising a revolving credit facility and convertible financing from Silicon Valley Bank. This follows the news that it had submitted a Form D filing to the US securities and exchange commission to raise $75 million in debt financing.
The announcement reveals far more about the reason for the filing, with Icertis looking to cement its leadership position in the Contract Lifecycle Management (CLM) market. It will use the funding to invest in extending its ICI platform with breakthrough technologies such as artificial intelligence, machine learning, and Blockchain with a laser focus on delivering customer benefit.
Rajat Bahri, CFO of Icertis, commented, “Customers across all verticals are using our AI-driven contract intelligence platform to digitally memorialize the purpose of every commercial relationship and ensure the intent of those agreements is fully realized. We continue to see strong momentum with our clear value proposition as we help customers become more agile, drive efficiencies, and respond to market challenges like inflation, sanctions, economic slowdown, and supply chain disruptions. This new funding from Silicon Valley Bank is a major vote of confidence in our growth trajectory, enhancing our already strong capital position, and enabling us to lean in to capture market share and build towards the next exciting chapter in our company’s journey.”
The Contract Lifecycle Management market is garnering a lot of attention from startups and investors. In 2019 MGI Research estimated that the CLM market would be in excess of $7.6 billion by 2022. It recently updated this forecast for the rapidly expanding market, saying that by 2026 it would be worth $30 billion! Icertis is one of the leading vendors in the category, but it has competitors such as Agiloft and DocuSign. There are also a growing number of startups in the sector, some of which have some different approaches.
The Icertis Intelligence platform delivers an extensive CLM platform that goes beyond most others. It includes integrations to other applications such as ERP, HCM and CRM systems. It also helps organisations to manage contract risk and ensure contract compliance. Its differentiation is the intelligence powered by AI and machine learning enabling organisations to surface insights to improve business performance.
Those integrations include SAP S/4HANA and a recently launched integration to SAP Ariba. SAP also invested in Icertis earlier this year. Icertis is now developing industry-specific solutions, including the recently launched one for the Banking, Financial Services and the Insurance market.
In this booming market, with VC growth expectations, the decision to look to a traditional bank makes sense. Bob Blee, Head of US Technology Corporate Banking at Silicon Valley Bank, said, “We are thrilled to work with Icertis and support its continued growth as a market leading contract intelligence platform. Contracts are the foundation of commerce, sitting at the intersection of almost all business processes. Understanding and harnessing the underlying data can drive material business impact to a wide range of enterprises. We’re proud to support the Icertis team as they build an enduring and industry leading enterprise software company.”
Enterprise Times: What does this mean
The only thing missing from this announcement is whether Silicon Valley Bank is looking to deploy the Icertis solution itself. While Icertis is looking to invest in R&D, the funding may see a series of acquisitions to bring in the technology components it needs rather than develop them from scratch. Expect more announcements in this area as well. In addition, will Icertis also look to expand its sales and marketing function to attract more customers?