In this episode of Founded and Funded, Madrona Managing Director, Len Jordan speaks with the founder of DocuSign and Seven Peaks investor, Tom Gonser. DocuSign is a Seattle success story – and Len was an investor during his previous role at Frazier Technology Partners.
DocuSign was founded during a time when installed software was the name of the game and the DocuSign team recognized that using the web to enable secure access to documents was going to be how the tricky problem of document signing was going to be solved. It just took persistence to convince the market.
Tom and Len discuss how a company that is changing a process that is both regulated and used by small and large companies alike is a complicated process. You have to start with one industry (real estate in this case) but then recognize when there is the opportunity to broaden the customer scope. This is often realized through selling to small companies initially to provide low levels of monthly revenue and product feedback so that you can level up to larger scale enterprise companies that will provide confirmation to the broader market that the solution is needed – as well as the revenue to grow.
While DocuSign had some early fundraising success, Tom reflects on how the middle years were the hardest. During this time the team was working on the product, the market was experiencing a recession, and their revenue and progress stalled somewhat, but this was also the time when their focus on creating a solution for smaller companies sustained them.
Len and Tom also talk about how you build a successful team from zero to a billion. Tom made the unusual decision to not be the CEO early on. Tom’s experience in previous companies had shown him that his passion was product and customer experience and he pursued that at DocuSign. Tom addresses how the most important element to growing a company is making sure you have the right people in the right roles as you grow – and recognizing when a role has outgrown a person or vice versa. Finding people in the early days who can be flexible in their changing roles as the company grows is crucial to retaining the corporate knowledge and culture while also enabling the company to grow as it needs to.
Product roadmaps are often influenced by existing customer requests for features. Tom and Len talk about building customer engagement and the balance between charting your own product future and building to customer expectations. Many companies struggle with this and Tom admits that sometimes DocuSign got it right and sometimes they didn’t.
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