Docugami, a startup aiming to reinvent the way businesses create and extract information from documents, has raised an extraordinary $10 million in seed funding led by Silicon Valley venture fund SignalFire, with NextWorld Capital and a large number of veteran tech executives and angel investors.
The company, based in Kirkland, Wash., also announced Bob Muglia, the former Snowflake CEO and longtime Microsoft exec, as a “major investor” and board member.
Docugami is led by co-founder and CEO Jean Paoli, a co-creator of the industry-wide XML 1.0 standard, Microsoft InfoPath and modern Microsoft Office file formats. The startup’s technology uses artificial intelligence to help users create documents such as contracts and reports that can then be analyzed in the aggregate as if the contents were stored in a structured database. Docugami says it’s creating new AI techniques using machine learning, computer vision, natural language processing and unique XML approaches.
“We believe we are fundamentally changing how information is created and used in businesses,” said Paoli in an interview this week, estimating that 85 percent of information inside companies is stored in unstructured documents. A few dozen customers are currently piloting a beta version of company’s technology, he said.
Even with an overall increase in early stage funding sizes in recent years, the Docugami financing represents an unusually large seed round, about 10 times the median deal size for seed and angel financing in the U.S. in 2019, according to PitchBook data. Paoli said the size of the round was driven by investors’ interest in Docugami’s technology and belief in its potential to give companies new insights into their businesses. The resulting valuation of Docugami wasn’t disclosed.
Muglia, who worked closely with Paoli at Microsoft and has mentored him for many years, said in an email that the Docugami “deeply understands how to leverage AI/ML technology to extract context and information from business documents.” He said the technology “can save time, improve consistency and accuracy, improve business and regulatory compliance, and provide previously unavailable insight into the content of the business documents.”
For example, Docugami’s technology can leverage AI to help users create documents such as lease agreements or other contracts based on past practices, and then generate dashboards that pull together information from a set of documents to provide insights to business leaders.
Paoli calls it a “small data” approach.
Ilya Kirnos, SignalFire’s managing director and CTO, said in a statement that the firm’s interest was driven by confidence in the technical expertise of the Docugami team. Kirnos worked previously as a software engineer at Google, serving as a technical lead on products including AdWords and Gmail Ads. He has joined the Docugami board along with Muglia.
Several other investors have extensive experience in document technology, including Greg Badros, former head of Google Apps; Shishir Mehrotra, CEO of Coda; Kevin Reigelsberger, former president of Avalara; Alan Smith a partner at Fenwick & West; and Barry Abbott, a partner at Lane Powell & Associates.
Other investors named by the company are Thomas Reardon, co-founder of CTRL-Labs; Ellen Levy, former head of corporate and business development at LinkedIn; Sarah Imbach, former senior executive at PayPal, LinkedIn, and 23andMe; Hank Vigil, former senior vice president for strategy and partnerships at Microsoft; Marc Jalabert, former executive at Microsoft Western Europe; and Sunil Chhaya, a Silicon Valley angel investor.
With the new financing round, the company has raised a total of $11.7 million, including pre-seed funding from its founders. Founded in March 2018, the company emerged from stealth mode in May 2019 and later announced its team of executives and technical leaders:
- Andrew Begun, co-founder and chief technology officer, a former engineering manager at Microsoft who helped create InfoPath,
- Martin Sawicki, co-founder, was an engineering manager at Microsoft, where he worked on Microsoft Office.
- Mike Palmer, co-founder, was also an engineering manager at Microsoft and worked on InfoPath.
- Taqi Jaffri, co-founder, was a principal product manager at Microsoft on the Windows team.
- Luis Martí, chief science officer, an artificial intelligence researcher with academic experience at Carlos II de Madrid, Federal Fluminense and Inria.
- Steve DeRose, head of natural language processing, was formerly a Brown University researcher.
- Alan Yates, chief business officer, a former Microsoft executive who has worked with a number of tech startups over the past decade in business development roles.
Docugami currently has about a dozen employees, and Paoli said he expects the team to “grow tremendously” as a result of the funding. The company lists current job openings in areas including software engineering, product management and sales.
Source: Geek Wire