SpotDraft shows that contract lifecycle management remains profitable, raises $26M

VCs see a rich opportunity in tools to manage the contract lifecycle. Two years ago, startups developing software that helps draft, manage and review contracts raised over $70 million in venture equity. While a relatively small space compared to, say, the market for customer relationship management ($44.9 billion in 2023), contract lifecycle management, or CLM, is growing at a rapid clip. Gartner predicts that legal tech spending -- which includes CLM -- will increase threefold by 2025.

SpotDraft is one of a growing number of CLM vendors trying to stand out in the increasingly crowded field. Launched in 2017 by Shashank Bijapur, Madhav Bhagat and Rohith Salim, the company today closed a $26 million Series A funding round led by Premji Invest, which also had participation from Prosus Ventures, 021 Capital, Arkam Ventures, Riverwalk Fund and 100x Entrepreneur Fund.

With $30.5 million in the bank, SpotDraft says that it'll invest in product development and "aggressive growth" in North America, aiming to double its 170-person headcount within the next 18 months.

"The capital we raised allows us to capture the market opportunity as it evolves over the next several years," Bijapur, who serves as CEO, told TechCrunch in an email interview. "We believe that we’re stepping into a new era of legal technology and SpotDraft is going to be at the forefront of building the next generation of legal innovation that saves time and money."

Bijapur says that the idea for SpotDraft came to him while he was an associate at Bengaluru-based law firm White & Case. While there, he saw legal teams struggle with high volumes of contracts and sought to automate some of the more repetitive workflows. 

After teaming up with friends Rohith Salim and Madhav Bhagat, two Carnegie Mellon computer engineers, Bijapur co-founded NYC-headquartered SpotDraft. (The trio met at a Diwali party in New York and moved back to India in 2016.)

SpotDraft's management dashboard. Image Credits: SpotDraft