GoContract is like Google Docs for Contracts by Startuprad.io
This is a special publication on January 6th 2020, a public holiday in some states of Germany, to commemorate the Three Kings. Learn more about the day below. (at the bottom you will find the Link to the video interview)
In this interview we are talking to Lucas Weiper (https://www.linkedin.com/in/lucas-weiper-0828a6167/), CEO and Co-Founder of the “almost legaltech” GoContract (https://go-contract.com/). GoContract is headquartered in the beautiful city of Koblenz (https://en.wikipedia.org/wiki/Koblenz), which is located between Frankfurt and Cologne. They offer end to end contract management.
“Lower Salary for startups is not an issue, if you can work with vision” Lucas Weiper, CEO and Co-Founder GoContract
A very brief startup history
In the past, Lucas worked for a digital agency and the (also) Koblenz-based startup Sdui (https://www.sdui.de/). He learned a lot about startups, digital marketing and even recruiting there. Actually, he even encountered the problem, GoContract is now trying to solve. The startup helps startups and corporates with the tracking and management of their contracts. They offer end to end contract management.
“I can not advise to outsource software development. You will need the IP in later VC funding rounds” Lucas Weiper, CEO and Co-Founder GoContract
Recommended Holiday Readings (Affiliated Links)
|The Fire Starter Sessions by Danielle LaPorte||https://amzn.to/38Ug3rU|
|The 7 Habits of Highly Effective People
by Stephen R. Covey
|The 8th Habit: From Effectiveness to Greatness
by Stephen R. Covey
|The $100 Startup by Chris Guillebeau||https://amzn.to/2PEoFet|
|Outliers by Malcolm Gladwell||https://amzn.to/36U41g6|
|Grit – The Power of Passion and Perseverance by Angela Duckworth||https://amzn.to/2SbuEcj
Learn more about our Affiliated Marketing here: https://www.startuprad.io/blog/affiliate-marketing-at-startuprad-io/
Note on German customs: Normally Christmas is considered over after January 6th, which is a public holiday in Bayern, Baden-Württemberg, and Sachsen-Anhalt, where the Three Kings (https://en.wikipedia.org/wiki/Biblical_Magi) are commemorated.
They started their company at Startup Weekend Koblenz (http://communities.techstars.com/germany/koblenz/startup-weekend) and found there their remaining co-founders. They set up the company with 6 people, where only three founders actually hold equity. The other three hold sub-shares.
Venture Capital Round
GoContract is currently raising its seed round in Q2 2020. If you are interested in investing, reach out to us, we will get you connected.
Vocational training in Germany: https://www.make-it-in-germany.com/en/study-training/training/vocational/system/
Techboost Telekom: https://telekomhilft.telekom.de/t5/TechBoost-EN/ct-p/TechBoost_en
Netflix Series Skyline, to which Lucas referred (taking place and recorded in Frankfurt)
- Official Trailer in German with English subtitles:
- One of the songs (in German) Skylines Kalifa – Rose im Beton ( Official Full Music)
Agile Method (affiliated links):
- Agile Methodology: A Beginner’s Guide to Agile Method and Principles https://amzn.to/36olKwI
- Kanban: The Ultimate Guide to Kanban Methodology for Agile Software Development https://amzn.to/35jvfLY
Keep up to date with GoContract
As Lucas said in the last minutes of our interview, you can follow them here:
Intro: Welcome to Startuprad.io, your podcast and YouTube blog covering the German startup scene with news, interviews and live events.
Joe: Welcome, everybody. This is Joe from Startuprad.io, your startup podcast and YouTube blog from Germany. As always, I can welcome another guest here in a remote interview from my study in Frankfurt (unclear) [00:33]. I do have Lucas here with me. Hey, Lucas, how you doing?
Lucas: Hey, I’m doing great. How are you?
Joe: I’m doing awesome. By the way, thank you for making time on a Saturday afternoon. But I know as an entrepreneur, you’re always working. Speaking of that, I’ve been stalking you a little bit on LinkedIn. And everybody who would like to reach out to you directly can go down here in the show notes and they will find your LinkedIn profile. Can you tell us a little bit about what you did before we get to your almost little tech startup?
Lucas: Of course. So, what I was doing, I think after my high school years, basically I started studying here in Copeland, which is right between Cologne and Frankfurt. And I studied English and management for 2 semesters, and then I switched to Information Management. I studied that for I think it’s now already 4 years. And then in the middle of the studies, I started working in a digital agency, and there I met my mentor, Albert. And he basically teach me everything from project management to sales over a little bit of programming and web design. And I got attached to the job pretty fast. I started working 20 hours and then pretty much shifted from 20 to 60 or 80 hours a week in a matter of months. And I started to get my own projects with Audi from over SEW-EURODRIVE. And over the 2 years I was with that, I learned pretty much everything I needed to know for my own startup, which I then started out of problem that we found or faced in the agency every day, which was creating contracts and collaborating on them.
Joe: Before we get into that, you’ve actually been staying with a few startups before operation and management. I see here business development. What did you learn there? Was it important for you to like get a feel, get a grasp on what a startup is actually all about? Did it teach you tools you needed, you can maybe even recommend to our audience here?
Lucas: Yeah, I started after… so, after my 2 years in with Albert and with the agency, I switched. And I did still some projects with Albert, but I also worked, I would say 40 hours a week for a company that’s still here on the… on the floor that we are working on. It’s called Stewey and they are doing a software for schools. So, communication, schools is their big model. And what I did there, I think that followed them or worked with them for about 5 months. And what I did was I was… I took care of as it’s in my profile, business development, which was talking to some customers in the… in the project management business as well. And but my main focus was on hiring strategies. And I think in that at that time, they just raised a new funding round and I was responsible for getting new sales and… and sales developers and sales guys on the team. And I did that starting… so, I had no experience in that at all, and I started going for… so, I was thinking about going with headhunting, but headhunting in Germany’s really expensive. So, you would pay around 20% of the yearly income of the person just for the headhunter. So, I just thought, “Well, let’s… let’s do it ourselves, because 20% for a startup is a lot of money, especially if you have a salary around 50 to 100K.” And I hired, I think 7 people for them. And the 1 tip I can give for… for hiring sales guys is, in today’s work environment, it’s really hard to convince someone by salary, especially because the big players on the market can pay a lot more obviously as a startup. So, what you have to do is you have to convince them by the idea and the vision of the product. And I think the 7 sales guys I hired, they all have kids around the age of they just getting into high school. So, this Stewey actually brings value to their kids, which is pretty cool, because in the hiring process, you can tell them, “Hey, you’re not just working for a corporation and doing sales for them, but you’re actually bettering the world.” And I think that caught a lot of the guys, that was pretty cool. So, I can always recommend going for vision instead of just going for salary, especially for startups.
Joe: When you’ve been talking, I realized you talked about head hunting, which is of course very expensive. But did you also learn about other opportunities, other options like Non VC funded startups would have to get already good employees?
Lucas: It’s… so, obviously you have to pay the salary. You can get around that. For startups, like I said, lower salaries is not a big problem if you can argue with… with vision. So, for example, with Stewey, it was the… that their kids can actually use the product that they are selling, which is quite… quite rare in B2B or in general sales. Maybe also hiring developers is also a big pain of a lot of startups. And I would never recommend… and that’s also learning from my time at the agency, I would never recommend outsourcing it to India or Ukraine. Because as a startup, what you’re building is you’re building a team first, but you’re also building IP and your product. And if you start developing from the outside or outsource everything, then you don’t have the IP of the software in your team, and you need that in the future funding rounds. So, I can recommend doing that as well. So, hiring sales guys, hiring developers, try to argue with vision because you will need them later on and funding rounds and generally in your team.
Joe: What I’ve heard from startups here in and around Frankfurt, which is a very, very tough market, for example, if you’re a good graduate in computer science, in business studies, you can earn 50,000 Euros or more just entering a big corporation. So, they… they are In a very tight spot here, the startups, and they usually start getting in touch with the people very, very early, like during their undergraduate studies as working student. That’s the only way it works for them to keep and retain good people, just keeping in touch with them. By the way, many people as you said, say won’t know Copeland, which is between Cologne and Frankfurt. And the only question for me there is, do you feel more like Frankfurt, do you feel more like Cologne, or nothing at all?
Lucas: Since I have some friends in Frankfurt, I think it’s more Frankfurt. And I also watched the series on Netflix, it’s called Skylines, I think; very good series. And since I watched this one, Frankfurt is still my… my favorite above Cologne.
Joe: Oh, yeah, I’ll quote you on that. Let’s get talking to about your almost startup. How did you bump into the problem? And can you tell a little bit about what current approaches are on the market and what you guys are doing? And we should tell the people that your startup is actually not even 1 year old.
Lucas: That’s true, yeah. So, we started in April this year. So, I think we’re like 3/4 of a year old. It… like I said, before in the agency at my now co-founder, Alessandro, I hired him as a working student. And this also goes back to the question that we have before about hiring. My co-founder didn’t study, so he’s currently 20 years old and he… I recruited him for the agency work right after his high school degree. So, he was 19 at that time, but he’s one of the best programmers I know. So, if you’re hiring, also keep looking for people who didn’t study because, especially in IT, a lot of the guys who really know what they’re doing and who are really good at what they’re doing, they didn’t go to college. So, also keep looking for that. But going to the founding story. So, in the agency, especially when I hired my now co-founder, Alessandro, we had the problem that contracts start usually in the internet, especially if you’re a startup, you have to search for a template and then you go for Word, editing it, and then you go to email. So, you sent the Word file by email back and forth, back and forth. And I think in our case, it took around 5 or 6 revisions for the working contract. And then usually, what you do is some people accept the digital signature when you just use your PDF viewer, for example, and some companies want it even on paper. Especially in Germany, there are some companies who still want it on the postal way. So, you have to print the contract, sign it, and then send it via post and in 2 contracts so that you can get 1 back. And the process of that is so long and it took us much time just to make a single or a very simple working contract. And we faced that also with service level agreements and other contracts that we thought, “How can we put this whole process that’s broken up in so many systems, Word, email, and some companies you have to track all the changes in Excel, and then you go for printing, how can we bring all that in 1 system?”
And we searched Google, of course, and we didn’t find anything, so the problem stayed. And in September last year it was, there was a startup weekend… or there’s a startup weekend every year here in Koblenz. And we pitched the idea at the startup weekend and we found some more co-founders there. And then, over the next 5 months, we were still working on the idea, thinking about it, pivoting a little bit, talking to other people. And in April, we made the decision of, “Yes, let’s found a company.” We founded, it was 6 people back in the days and then we started programming. And I think because of my network from the agency and because of the progress that we’re making so fast, and that we found that actually the company, we got the first VC on board and the first business angel in June already this year. So, we did our first finance around in June. And ever since then, we are programming the software that solves our problem and hopefully, the problem of so, so many other companies. And we unloaded our first 5 customers, actually last month.
Joe: Oh, so many questions, so many questions. Let me… let me first structure them. First, 1 escaped my mind. But first, can you tell me, are you open for investments? Are you looking for investment?
Lucas: Mm-hmm, yeah. So, we are currently funding our seed round. So, the one that we did in June was our pre-seed with 150,000. And we’re currently looking for half a million. And I’m thinking about doing it in end of q1, maybe quarter 2 of next year.
Joe: And what also popped into my mind when you’ve been talking about 6 co-founders, I thought, “Oh, that’s a lot.” I know VCs like to invest in teams of 2 to 3 people. Why are you 6 people? And would you do that again?
Lucas: So, we’re not really 6 people, we are 3 people on paper that founded the company. So, with the VC, it’s quite fine. And but we also had 3 people on the team or 3 developers who supported us since day 1. We also met at the startup weekend. So, they have sub… sub shares with me, and which makes it quite easy to manage it also with the VCs. I will do it again, definitely, because it’s very important, like I said in the beginning, to have a good team with a lot of knowledge. And in our case, the developers all have their certain backgrounds. So, for example, 1 is mobile development, 1 is back end development, and the other 1 is front end development. So, we had basically 1 guy or 1 girl who has a very specific knowledge in 1 field. And we could leverage it throughout the months because we… you have to… you have to set it in a frame that since April ‘til October, that was the timeframe that it took us to go live with a software that’s quite big. Also, from my understanding, from the agency world, that’s a very short time to release the software that has so many features. You can check them out on the website as well, if you want. And so, yeah, I would found with 6 founders again, because it’s… it was very time critical and it helped us to leverage the knowledge of the developers very well and of all the other team members. And for the VCs, I don’t think it’s a problem because the more people are vested in the company, the better it is for them because the people will be vested as well over the contracts that you make with the VC. So, the VC has a lot more security that there’s going to be in bad times more people who will still stay with the company.
Joe: I see. Do you think it’s critical for startups to pay people also partly in shares so they can participate in the upside potential?
Lucas: Hmm. So, I’ve seen it in several startups. And they all do it differently. For us, it’s the sub share model, which works, especially the beginning when you can’t pay any salary and you still want to leverage knowledge. I’ve seen it in other startups who were only 2 founders and the shares were only with them. But as they grew to 25 people, I think they’re now, they’re also giving some gold shares or sub shares or whatever you want to call them, to the employees who’ve been there since day 1 and who are still working 60, 80 hours a week for the startup. Because I don’t think that you can hold potential in any other way, especially if they’re working so much. Because I’ve seen it, and they will get offers from other companies with way, way more salary.
Joe: Mm-hmm. Talking about your very fast start before we get into what you guys are actually doing, how did you structure all that approach? Because I do believe, if you put just 6 people in the room and say, “Okay, here’s the screenshot, that should be the software. Now, start working,” it would just end up in a big chaos. You need to structure it, you need… you need to think through it. How did you approach that?
Lucas: Mm-hmm. So, I think some of my experience in project management came in handy when we did that. But basically, you have to get people on board who are really good in a very specific field. So, for example, we have Amir who is a back end developer. So, what we did was in sprints, I think it was weekly sprints in the beginning, we said what we want, we got this the front end design as well. And then, Amir was… was working on backend only and no one else was interfering in it. So, basically he has built the whole back end that we have today himself. And because of that, he can say on Monday when we have the sprint meeting, he can say, “Okay, I will need 3 days to bring in this feature.” And then when he’s done with it on Thursday, then Alessandro can start working on the front end and implement the feature that Amir just implemented. So, basically, of course, Amir had needed a little bit of free time to get… get a head start. But after that, it was basically weekly sprint, and then every developer had its own responsibilities, so he didn’t have to micromanage between them. I think that’s a very good approach for… for having such speed in a project.
Joe: You’re talking about agile methodology with weekly sprints. Do you also have like a long term planning with milestones, especially from your VCs?
Lucas: So, yeah. For our pre-seed round, the milestones on the software side weren’t very heavy. It was basically 1 milestone that we had to be finished with… with the MVP, so to say, in October. But I think long term goals, it depends. So, it depends on which phase you are. So, when you are very early and just starting, of course, you need some milestones in it. But right now, for us, it’s basically just implementing customer feedback. And the milestones… to define the milestones there, it’s almost impossible because they change on a weekly basis. So, software-wise, there is no milestones right now. Maybe weekly or monthly milestones, but not anything further than that.
Joe: Talking about milestones, where did they bring you? Where are you guys right now and what can your software do?
Lucas: So, basically, I can give you a little pitch about GoContract basically what the software is doing in general. So, what we’re doing is we are bringing a platform that digitalizes the whole process of a contract. So, you start in our software with creating a template, and then you can reuse that template to create the actual contract. And that’s where it all starts, you create a contract. And then you go into the heart of the software, which is collaborative editing or collaborative editor. And that editor, you can invite all the parties that you want in your contract, they will just get a link and a password and then they can immediately start doing what they want to do. You can also give the parties the rights to sign or the rights to edit the contract. And then we give some tools, for example, version tracking, you can have both or more than one version of a contract side by side and compare them. You can have annexes to a contract, and that’s all the stuff that makes the whole thing usable, really tailor-made for contracts. And then after you finished your contract with all the parties that you want in there, you can sign them the contract, and then you can archive it in the software as well. So, basically, you have end to end contract management.
Joe: When you’ve been talking about that, I took notes. That’s why it took me so long. First thing that came to mind is confidentiality and data storage. How can you make sure for example, if that you give out the data to the right person? And where do you host the data?
Lucas: Of course hosting, that’s always the first question that we… that we also get from a customer here in Germany. Of course, we hosted in Germany. We are currently in the tech post program from Dutch telecom, which is pretty cool for… for startups in the beginning, especially when you need some infrastructure to be set up in Germany. We were thinking about Amazon Web Services in the… in the… in the very beginning, because that’s I think the cheapest trying to go for startups in terms of data storage. For some industries, especially in the German Mittelstand, if they see some AWS popping up, they’re still a little bit scared of it because Amazon of course, it’s not a German company. So, we’re using telecom and leveraging basically their infrastructure for our needs. Yeah, what was your initial question again?
Joe: How do you make sure the right person gets the access to it? Because you have email and password?
Lucas: Yeah, that’s the normal login, yeah. And for the parties that you invite that don’t use your GoContract, you just send out a link and a password basically, and they can set their own password. The way we do the distribution of… of the contract or the content of a contract is that we… in general, we… we encrypt everything on the user side, on the client side. So, in any case, or even if we wanted to, we couldn’t read the contract or the content of a contract that someone makes on our platform. And what we basically are is just a middleman that distributes all the… the keys so you can decrypt the contracts again, and redistribute the encrypted content of a contract to all the parties. And then of course, we keep track of the versions. So, if you’re editing a contract between us 2, I wouldn’t be able to edit it. And this way, we can have a revision proof locked file of the contract basically.
Joe: Sounds good. What I also had in mind, do you have like other ways you can jump off from other software, maybe internally in big corporate or tools like data room, hosting services where you can go directly from the data into negotiations or something like that?
Lucas: Yeah, that’s… that’s what I was talking about when I was talking about the customer feedback that we’re currently implementing. So, for now, we are starting to implement DocuSign because we saw that a lot of big corporations already use it for their signing process. And of course, GoContract also offers the signature, which is quite trivial to implement. But since DocuSign is already implemented in a lot of companies, we’re implementing the API for DocuSign so that you can immediately jump out of the negotiation process from GoContract into your designated signing tool. And I think next year on the goal as… as more customers will come to the platform, we will implement a lot more of these API’s to third party services as well.
Joe: Last moment of pitch. I was wondering, do you… you’re very young as we said, you’re not even 1 year old. You got a handful of customers yet, but I do believe that will be much more. But have you at least some guesses how much, let’s say, time the companies are actually saving by using your tool instead of sending around what documents not to talk about the litigations that may follow from the wrong word document being used?
Lucas: Mm-hmm. I can give you a use case on that one. So, we have a patent attorney currently on the software. And the way he’s using it, he’s using it for his NDA contracts, which is pretty standardized, but you still have to make some… some changes to instruction and for each customer, obviously. And he makes about… it’s a very small firm. I think he has 6 employees, and he makes around 70 NDAs per month. And you can imagine if you send an NDA to a customer, it takes… you have to write 1 email. In the best case, if there’s no changes, in the worst case, I think he had one NDA where there was like 5 revisions of the NDA contract because the legal department of the customer was pretty noxious about the terms that were in there. So, in the normal case, you have 1 email and you always have to write, “Dear Sir/Madam, I’m very pleased to invite you as a customer. Here is the NDA contract.” And he says that alone takes them 5 minutes per contract per NDA, also to edited, which is not a long time. But if you go up to 70 contracts, you have a couple hours that go waste basically for NDAs, and he can’t make any money from that because this time, he can’t invoice. So, the way he does it with GoContract is he can immediately create the NDA contract from a template that he already created. He can edit the contract in no time. And then he only has to put in the email address and we take care of the rest. So, he saves about maybe 2 or 3 minutes per contract, which in total saves him about 3 hours of time every month. And an attorney has a pretty high salary per hour, so it probably saves around 1000 euros just by automating the NDAs every month, which is a lot of money for a small company. And then of course, if you scale this up to bigger corporations where you actually have more revisions of a contract that go around via email, and a lot more stakeholders in this process, these 3 minutes add up a lot during the block process, only by eliminating the email part. And then of course, we all know that Word files can a little… can get a little messy over time. So, that also saves you a lot of time. But we don’t have any statistics on that yet.
Joe: Word files getting messy never happened to me, especially formatting. I was… I was… actually, I had a question in mind, but then you kept talking and you actually solved it. Well, for everybody who’s watching this on YouTube or listening to it on Spotify, Deezer, TuneIn, Google Podcast, iTunes, whatever, just want to say thank you very much. It was just a pleasure having you here. And it’s actually our second recording, because the first 1 was with you a recording where the first time in my life without Google Hangout, which ended up pretty low quality, and we decided we got to do it again. So, thank you very much for that. Any famous last words you want to say?
Lucas: Of course, thank you for having me a second time. And in general, if anyone is interested in what we’re doing, you can check us out on YouTube. We’re very active on LinkedIn if you want to get any updates. And of course, our website is a very good first start and then we can get in touch. And of course, send us an email email@example.com if you do believe, like I do, that those guys are actually a legal tech startup. It was just a pleasure having you. Thank you very much. Bye.
Lucas: Thank you very much. Bye.
Outro: That’s all, folks. Find more news, streams, events and interviews at www.startuprad.io. Remember, sharing is caring.