Jason Boehmig is the cofounder and CEO of Ironclad which is one of the nation’s top makers of enterprise software for managing contracts. The company has raised $183 million from top tier investors including Accel, Sequoia, Greylock, and Bond to name a few.
In this episode, you will learn:
- The future of business contracts
- His top advice for founders and CEOs
- Rooftop Law School
For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
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About Jason Boehmig:
Jason Boehmig is CEO at Ironclad Inc., a contract management software company. Jason Boehmig is a California licensed attorney and previously worked at Fenwick & West LLP, where he helped the firm roll out new technology initiatives and managed the deployment of the Series Seed set of open-source financing documents to GitHub.
Ironclad is the preferred contracts management platform for hundreds of in-house legal departments who use Ironclad to provide self-service contracts to business units, track progress and secure approvals, manage tasks across team members, and automatically capture key contract data in a searchable database.
Connect with Jason Boehmig:
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FULL TRANSCRIPTION OF THE INTERVIEW:
Alejandro: Alrighty. Hello everyone, and welcome to the DealMakers show. Today, we definitely have an exciting guest, a guest that is a recovering lawyer, just like myself, and I think we’re going to be learning quite a bit on his journey. It’s definitely not the journey that he thought he would embark on because no one in the family was an entrepreneur, but we’re going to get into that. It is remarkable what he has been able to accomplish. I don’t want to make you wait any longer, so without further ado, let’s welcome our guest today. Jason Boehmig, welcome to the show.
Jason Boehmig: Thanks for having me here. It’s an honor.
Alejandro: So, originally born in Pittsburgh. How was life growing up there?
Jason Boehmig: Life in Pittsburgh was actually really interesting from a historical perspective actually. One of the things I talk about is growing up in the shadow of some of these industrial titans that existed in Pittsburgh: the Carnegie Museum and the Frick Conservatory. But actually, it was like a depressed economic environment to grow up in the ‘80s in Pittsburgh, and the population was going through a lot of decline and economic hardship. It was interesting to have lived in a place that was once the center of industry but was going through a tough economic environment when I was growing up.
Alejandro: Afterward, you went to University in North Carolina. Then you decided to go into investment banking, Lehman Brothers. At that point, investment banking was the time where dollars were flashing, everyone making it rain, but you had to face the not-so-fun part of it. Tell us about this.
Jason Boehmig: Yeah. It was a great way to start the career, actually. I learned a ton, and the reason I decided to do it coming out of school was this was a chance to learn a lot about finance. I studied economics in school, but it’s one thing to study a topic and the other to actually learn it as a profession. I looked at it as I’m going to come in. I’m going to do a two-year stint at one of the great investment banks. I loved working at Lehman and learned a lot, and then figured out what I wanted to do with my career. As the next step, I had always thought about law school but wasn’t sure. I looked at it as this two-year stint to learn a lot, and from that perspective, I was really successful and ended up sticking around for four years and doing an internal transfer over from the IB side to the Sales and Training side of things.
Alejandro: So, once everything crashed, everything was imploding, you decided on law school, and maybe that was the thing that pushed you to go for the next chapter in your career, which you felt law was the way to go. You were in New York City. Here, we’re talking about the city where you have most of the big law firms. I actually used to work in Midtown, too, at a law firm called King and Spalding. Why did you decide to go to San Francisco to practice law when you have some of the biggest firms in the city where you were living for so long?
Jason Boehmig: Yeah. Part of the journey was this understanding that I wanted technology to be a big part of my career. At Lehman Brothers, I had the fortune of sitting next to some quant traders. It was the first time I realized there is a revolution in the way that we work happening right underneath our noses. These quant traders were able to tell you things about bonds or securitized products that no one, even if they sat on a trading desk for 30 years, was capable of processing in their mind. You had to process it through computer code. Sitting on the desk there and seeing that planted the seed of technology seems like one of the great historical transitions of our lifetimes, and it’s exciting to play a small role in that. The center of that universe, particularly back in 2008 when I was leaving Lehman Brothers and in 2012 when I was graduating from law school, was definitely San Francisco and to some extent remained that. That was really why I definitely had the snobbish New York viewpoint of San Francisco of its backwater, and no city is as great as New York. So it was begrudgingly that I moved to San Francisco to practice law after cutting my teeth in New York.
Alejandro: It’s interesting here what you got in terms of experience because, on one end, you had access to the investment side of it, so you were able to see how deals were done, what maybe made good companies versus bad companies. And now, you were going into law where you were able to get a good understanding as to how contracts are written, how to prevent making mistakes when it comes to putting pen to paper, and you did that for a few years. What were some of the things that you learned, maybe some no-noes that you saw with your own eyes that you knew that if you ever were to start a business, you would never have to?
Jason Boehmig: Yeah. I think one of the things that I was able to internalize working on Wall Street and making the transition to law is it really is important to have a motivational connection to the work. I enjoyed finance, but it wasn’t the job that I felt I could be happy with for the next 20 years, just in terms of natural interest in the subject. It did influence how I thought about my career in the legal profession and being willing to take that pretty big step back in my career. Working on the street for four years, it’s not a ton of time, but it’s enough to get pretty senior, and a lot of my colleagues were doing interesting things. All of a sudden, I had just taken three years off of my career to go back to law school, and I was a first-year associate. Eight years deep, almost nine years deep into my career, was like starting over again. But the perspective that I gained was it’s okay to start over if you’re closer to the center of that passion and place that you feel you can get curious about for the next 20 to 30 years. I do think that one single lesson is attributable to a lot of the success of Ironclad. We have just gotten more curious in our space than anyone else. There have been 30+ companies doing what we’re doing, but the level of questions and the depth of curiosity is much higher at Ironclad than our competitors and historical competitors, as well.
Alejandro: Let’s talk about that transition from Fenwick and West, where you were an attorney, all the way to bringing Ironclad to life. At Fenwick and West, you were exploring with technology like building your own site things or your weekend projects, so to speak. What kind of lawyer – I mean, a lawyer of coding is kind of strange, or perhaps building stuff in that nature. Tell us what triggered you building stuff or what kind of stuff were you building that pushed you over the edge to think, “Maybe there’s something I can do here more as a business.”
Jason Boehmig: Yeah. I would say my inspiration for doing this was the quant trader, and that’s how I wanted my practice to work. If you think about what the quant traders are doing, they’re using computers in a new and computer language in a way that helps them do their core job, which is trading. They’re still functionally trading. They’re not just pure coders. The objective is to trade better and gather new insights that help you make better trades. That was how I conceptualized my technology involvement at the law firm. I’m still going to be a lawyer; I’m just going to be a tack-enabled lawyer. It turns out that I’m going to have to build a lot of that tooling myself because it’s just not in the market. My intent was never to build the technology. My intent was to go find it in the market. It was only when I couldn’t find it in the market that I realized I’m going to have to make this if I want it to exist. So, I went out and hired a coding tutor. I taught myself to code over a multi-year time span and started making very simple applications, as simple as writing a Visual Basic script that would automatically compare a set of documents in one folder with the set of documents in another folder and generate a bunch of PDF redlines. You, as a lawyer, know the amount of time you spent clicking buttons to make a red line for a deal packet is actually insane. What I was really trying to do is not the really high-end work, but just the low-level administrative work. That just proved to be a lot more fruitful than I would say I thought it would be going in. I thought I would discover ways to do this that existed in the market, and I thought that I wouldn’t be able to get as far as I did just hacking together on my own time nights and weekends. Once I started to go down that rabbit hole, I realized there’s really a market opportunity here, especially around this common problem that every business has, which is making and keeping track of its business contracts.
Alejandro: Yeah. So then tell us about the moment where all of a sudden, you said, “This is something that I have to do.” Obviously, for you, it was not a good time. You had $300,000 in student loans, which is outrageous. It’s just broken – the whole education system. But, anyway, that’s a different conversation. But here you are, not in the best situation to start a business. Probably, people thought you were nuts because you also, as a lawyer, were making a decent living to be able to repay that amount back. Tell us about that process because I’m sure it was full of uncertainties and probably not a good position to be in to start a business.
Jason Boehmig: Yeah, it was frightening. I’ll be honest. It was frightening, but it also felt right at the core of it because I did feel like I could see something in the market that I was comfortable making a huge bet would be more of a thing than it was when I started. It really did feel like I had this insight that I kind of recognized from the trading floor, which is this is going to happen. It’s definitely going to happen. Can I be a part of it happening? Like, that’s the bet, and that’s what I’m willing to take the risk on. But I’m willing to bet anything that this will be more of a thing five years from now than it is right now. I feel like I’ve got a pretty good fighting chance at actually being part of that creation of it. That thing, of course, was a system for business contracts, like a more automated and streamlined and internet-enabled and connected way of creating a business contract and an automatic way of keeping track of the terms in business contracts. It really was like quitting was this moment of this is going to happen. I’m comfortable betting my career on it. Fortunately, we live in a place in Silicon Valley, where, “Even if it doesn’t happen, what’s the worse thing that could happen? I could go bankrupt. Yeah, my student loans don’t get discharged, but I’ve already started over with the legal career anyway, so let’s do it.” I was in a position where I wasn’t in a relationship or didn’t have kids, where I felt like I was only impacting myself and only making foolish decisions for myself. It was enough to put me over the edge to take the leap.
Alejandro: So what ended up being the business model of Ironclad for the people that are listening to really get it?
Jason Boehmig: Ironclad has uniquely always been focused on the same thing, which is helping companies create and manage business contracts. We have this belief as a company, which is what led me to quit my job and start up with my co-founder. That belief is that there needs to be a digitally native way to make and keep track of business contracts. It’s really nuts that something that every business in the world does, which is make contracts, there’s no standardized or singular way to do that. If you and I were to make an NDA and we’re not using Ironclad, we’re going to maybe download a template from somewhere, where I’m going to put it into Google Docs or email you a Microsoft Word file. When you send it back, I’m probably going to redline, or we’re going to do some track changes stuff. If I have to get it approved on my side, I’m going to randomly send that around my organization. If we’re going to get it signed, let’s open up another browser tab, or we need to save that as PDF first. Then, maybe we’re going to load into an eSignature platform. Then, if we want to keep track of the information in that, we’re probably going to do some manual data entry in a spreadsheet, maybe, or in a customized CMS or something. It’s like, why are we opening 17 browser tabs to make a business contract? That doesn’t make any sense. So, my life’s work is to streamline that into an easier process and capture the digital information in that. There are some pretty good terms in that NDA that we might want to know if that information is applicable in some other deal intelligently. If there are payment terms in a contract that we made, we probably want to send that to our financial systems so those payment terms can actually happen. From that perspective, connecting it to a comment you made earlier, I think lawyers do code. I don’t think that lawyers code in programming languages that computers can understand.
Alejandro: You guys basically created a new category here. Why do you think there hasn’t been that much innovation around the legal type of segment or around what you guys are doing? Why is that the case?
Jason Boehmig: So, a couple of reasons, and I think a lot of folks, even in our market, missed this. It’s hard for buyers to even understand. The real art to what we’re doing is building a customizable, configurable, and robust system for all business contracts that you can create and manage them on. You and I could probably hack together in the time of this call a cool AI demo that would scan a contract and pull out a clause or two. That’s great, but the reality is, you’re not going to use that in business because it’s wrong 10% of the time, and it’s impossible to figure out what 10% of the time it’s wrong on. So, you might as well do the manual data entry.
Jason Boehmig: What’s cool about Ironclad is it’s got all of the enterprise-type things that a customer would need to “If this contract has this language in it when it comes back, you can automatically trigger this fallback provision, and it’s going to go to Joe in finance if it’s above $10,000 per your company policy. We’re also going to send the payment information to NetSuite when it’s done, and we’re going to send the customer information to Salesforce.” No one action in that is complicated – sending data to Salesforce, like triggering an automated approval. But if you look at the landscape pre-Ironclad and the landscape post-Ironclad, it’s like 17 different systems that are handling that contract roundtrip. What we’ve done is build the layer, like the beautiful interface layer, over all of those other systems. Where we found true light space, we’ve actually built it. You, as a lawyer, I used to use a separate redlining software. I used to use a separate document management software. I used to use a separate word processing software. In the digital world, that stuff needs to be combined together, and there are a lot of technology decisions that need to be made to do that in a way that’s usable and configurable.
Alejandro: Absolutely. In this case, for you, for Ironclad, how much capital have you guys raised to date?
Jason Boehmig: It’s 180-something. I believe it’s 187. It might be 183. Let’s say over $180 million. That’s 100% accurate.
Alejandro: Okay. For you guys, it probably has been an incredible journey when it comes to raising money, especially when we’re thinking about a new category here that you were developing. Now, maybe it gets easier to convince and to talk to people because you have all the historicals and all that stuff. At the beginning, I’m sure that it was quite a beast to be able to get people comfortable with and enrolled in what could be possible with this. So how has the journey been and the progression from one financing cycle to another one, all the way up to your Series D that you recently closed?
Jason Boehmig: It’s funny. You bring up an interesting point, which is, everyone loves to say, “Oh, fundraising seems easy. You must have it so easy.” I’m not complaining here. We certainly have incredible partners, but fundraising is never easy. It’s always convincing folks and building a business that folks are investing hundreds of millions of dollars in. That doesn’t happen lightly, and it is a heavily diligence process. I once applied for government work earlier in my career, and I went through an intensive background check for that. Fortunately, I didn’t pursue that career path. But the Sequoia background check is much more intensive. There are people from all walks of life getting interviewed about me, and there are really deep dives on diligence that the best investors do – not just on the fundamentals of business, but two or three layers down within your org. Like, who are the people working there? It’s been interesting and fun to watch how the best investors make decisions. We have Accel, Sequoia, Bond Capital, and Y Combinator, of course. We have a nice spectrum into that world.
Alejandro: Talking about diligence because, especially with a legal background, you had an idea of what diligence was about, especially being on the other side, pushing paper, pushing the contract. For you, what was the most surprising thing? Being the one that was receiving the diligence, what was the most surprising thing that you discovered. Obviously, we don’t have to mention names, but some of those investors did to really get down and understand who was behind this business and what was this business about?
Jason Boehmig: Yeah, it’s interesting. I think a commonality among all investors is they care about fundamentals. I think that’s investors of all levels. I would say, having observed probably hundreds of investors, at this point and their process, the best investors in the world are more focused on people than other investors. They will spend more time relative to other investors investigating people, like, giving you reads on people and doing background reference channel checks on people that are more detailed and more layers removed from the network than other investors. I don’t know if this is a data point of one, but if I’ve drawn any conclusions from being on the other side of hundreds of investors, it’s that the folks that have the best reputations, it’s deserved, and it’s because they’ll go a couple of layers deeper on the personal side of things, not only on the business diligence side of things.
Alejandro: Got it. One of the questions that comes to mind is, here we’re talking about business contracts. But one of the things that is super interesting to me is that definitely for Ironclad, one of the things that has been remarkable is the community and how you guys have been thinking about community to push this thing forward. Talk to us about why community has been a big driver for Ironclad.
Jason Boehmig: Yeah. I love this topic, and I think there are some lessons that are applicable to other segments as well. If I had to draw one piece of advice or learning, it would be that if you are doing category creation, which I think we are, you have to do community because category creation requires a little bit of predicting where the market is going to go regardless of your existence of the company, and then orienting your company toward that. It’s the Gretzky-like stat to where the puck is going to be a type of thing. If you’re going to create a category, you can’t just will that category into existence. Category prediction might be a better term than category creation. You just have to skate to where that category is going to be. I don’t think you can actually do a lot to will it into existence, like a company that just thinks up a category and then tries to create that, I don’t think will be successful. But a company that tries to identify a category that’s going to exist, and the market hasn’t figured it out yet. I think that’s where I’m going to make my bets on category creation. Community allows you to be a better predictor of where a category is headed or where a need is headed that a category will form around than other means available to you as a software company. I’m a lawyer, like you, and what we did was we got curious about the lawyers in the early days and the in-house legal departments, and from there, the legal operation folks who are often nonworkers working in legal departments. We just got to know them as people, not just like what they would want in a piece of software, but like, “Where do you live? What’s your family like? What do you read on the way to work?” Just curiosity about their lives. We found forms to do that, which we still have today. They’re often nerdy forms. For example, we have an event coming up tomorrow called Rooftop Law School that we’ve done since we were a four-person company. It’s people reading a legal case together and discussing it. All sorts of folks come to this. Potential prospects come to it. Random people come to it. But like creating a form for people to be nerds about their profession, lets you learn how I found it in a way that bigger companies are not holding Rooftop Law Schools and trying to get to know their customers at that level.
Alejandro: That’s really cool. In this sense, for the people that are listening and watching, to get an idea on the scope of the operation or perhaps even the size of Ironclad, anything that you can share in terms of numbers – maybe numbers of employees or anything?
Jason Boehmig: Yeah. We’re exactly 250 people and not even a rounded number there. We’ve got four hubs: New York, San Francisco, Indianapolis, and a remote hub. We just announced our first big acquisition. It’s a company called PactSafe. That’s the basis for our Indiana hub. They are a really interesting addition to our kind of product arsenal in that they do clickwrap in terms of service agreements. Think about how many of those exist on the web. PactSafe is powering hundreds of millions of those. They are the #1 provider in the world in terms of quality of product and pervasiveness in the enterprise around clickwrap. It gets into our vision of creating the digital business contract. Yeah, 250 people, $180+ million raised, Series D stage, based in those four hubs including remote, and we’re moving.
Alejandro: Very cool. Imagine if you go to sleep tonight, Jason, and you wake up in a world where the vision of Ironclad is fully realized. What does that world look like?
Jason Boehmig: That’s an amazing world. That world looks like Ironclad is the platform for business contracts. A lot of what folks are excited about with AI or Blockchain is possible on Ironclad. When you sign a contract, the information automatically flows over to your payroll system and lights up a big green check when that payment has been received. Your sales folks always know the latest customer information, and diligence happens in a snap because all of the contracts at every company are automatically organized and tagged and searchable, and existing in one place. It’s a world of very seamless and sophisticated business contracting.
Alejandro: Very cool. Now, imagine that I put you in a time machine, and you’re able to go back in time, to go back in time, perhaps to that time where you were still a practicing lawyer at Fenwick and West, and you were thinking about a world where you would launch your own thing, your own business, and put all those problems that you were seeing and solving them with a solution. If you were to have a chat with your younger self, that younger Jason that was still a lawyer, and give yourself one piece of advice before launching a business, what would that be and why given what you know now?
Jason Boehmig: Great question. I think it’s something like: know thyself. That’s been one of the highest leveraged things for me. As a CEO, in a lot of roles, there’s a prescriptive way to grow. I think the job of a CEO is to keep up with the pace of the organization and lead the pace of the organization. As a founder, there’s no training for this job. There’s no training for being a founder and CEO, and you have to do a great job. The only tool you really have for aligning those two things is self-knowledge and personal growth. It’s deeper than just professional growth. So, investing in that and getting serious about committing to that is something I’ve learned to do, but I probably could have learned to do earlier. I think that would pay the highest dividends if I was able to get there faster.
Alejandro: Wow. I love that. Jason, for the people that are listening and watching, what is the best way for them to reach out and say hi?
Jason Boehmig: We have chat on our website. I love this feature. The best way to reach out to Ironclad is ironcladapp.com. There are a number of ways to get in touch on there, but give a try on the chat and give us a shout there.
Alejandro: Amazing. Well, Jason, thank you so much for being on the DealMakers show today.
Jason Boehmig: Thanks for having me. It’s been a pleasure.
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