Despite the coronavirus pandemic pushing many companies into financial distress, business software company DocuSign has managed to soar.
The company specializes in technology that lets people sign documents electronically, which is just what many businesses now need. Shelter-in-place orders have turned tens of millions of people into remote workers while general fears about COVID-19 have put a stop to most in-person business meetings.
The result: More memos, term sheets, and legal documents must be signed electronically than ever before. For DocuSign, this translates into a big opportunity.
Its first-quarter sales ending April 30 jumped 39% year over year to $297 million. And while many companies have stopped giving financial guidance, citing uncertainty caused by the coronavirus pandemic, DocuSign raised its sales forecast for fiscal 2021 to $1.32 billion from $1.27 billion.
In contrast to most stocks, DocuSign’s has nearly doubled since mid-March, when shelter-in-place orders began taking effect.
Dan Springer, DocuSign’s CEO, said the company hasn’t implemented any layoffs during the pandemic and is instead on a hiring spree, specifically for salespeople.
In a month, DocuSign plans a trial reopening of its offices in Tel Aviv and Sydney, where lockdowns have eased considerably. If those reopenings go smoothly, then the company will consider turning the lights on in its bigger offices in cities like San Francisco and Seattle.
But echoing recent comments made by Salesforce CEO Marc Benioff, Springer acknowledged that the routine for workers in reopened offices will be vastly different than it had been before the pandemic. Employees may be separated by three desks, for example, and they’ll likely have to wear masks. He also plans to monitor any challenges employees face in returning to work, such as commuting by public transportation, which many workers may be reluctant to use.
Already, Springer said DocuSign has held some in-person gatherings as a test. For instance, he and a few other executives got together last week in a large conference room—with appropriate spacing—for the company’s quarterly earnings call with investors. Physical meetings still hold an important place, he explained, even in a world in which video calls have quickly become the norm.
“We see a lot of people talking about Zoom burnout,” Springer said about the overdose of videoconferencing. While Zoom “has worked pretty well” during the pandemic, there are a few things he finds lacking in virtual meetings. It’s difficult to see everyone during large gatherings and nearly impossible to read their body language, which can be a subtle form of communication.
As for industries that are spending more on business technology during the pandemic, Springer said that “financial services have grown substantially.” DocuSign has also benefited from customers that manage the federal loan programs created during the pandemic needing digital signature technology. “New York State, at one point, was making 21,000 connections” to DocuSign’s electronic signature service every minute to help with processing unemployment claims, Springer said.
Business from banks, on the other hand, has taken a hit, Springer explained. “If you’re Bank of America, and you’re opening new loans and doing it at the branch on an iPad, that’s not there anymore,” he said.
A similar phenomenon has also affected T-Mobile, which has closed its retail outlets, which in turn impacted DocuSign’s business. Until then, T-Mobile stores created customer accounts using tablets and DocuSign.
“So that volume, when they closed all their stores, obviously went to zero,” Springer said.
He also noticed that while companies are using electronic signature services more frequently, they are pausing some of their more ambitious digital transformations or tech upgrade projects involving DocuSign. These longer-term initiatives, which involve the complicated process of organizing and managing digital documents, typically generate no immediate income or savings, so corporate customers feel they can delay them until the pandemic ends.
Springer also acknowledged the mental challenge to his employees of the pandemic and the police killing of black Minneapolis resident George Floyd. “It’s hard,” Springer said about communicating with his workers about the upheaval. The company recently had an all-hands meeting at which, he said, executives “tried to be as straightforward as possible.” Although the company is doing fine, Springer said, “it’s incredibly stressful, and we’re pushing people to get mental health support.”
