The number of transactions using electronic signatures is growing, even though the number of companies offering the service is shrinking.
That’s the key takeaway from a new report out that is forecasting growth for the electronic signature market. The estimates are particularly interesting in light of DocuSign’s announcement last week that it raised a whopping $233 million in venture capital.
Forrester Research estimates that the electronic signature market is seeing an average annual growth rate of 53 percent, with transactions estimated to grow from 210 million in 2014 to 700 million in 2017.
In an interview Forrester VP and Principle Analyst Craig Le Clair he said DocuSign, which has offices in San Francisco and Seattle, is the market leader followed by Adobe, but that the number of players is quickly decreasing. “There’s been a lot of consolidation in the market, and every pure play has been bought by someone,” he said.
The list of acquisitions over the past couple of years is extensive: DocuSign purchased both Algorithmic Research, or ARX, and Cartavi; Adobe bought EchoSign; Lexmark purchased Kofax and Citrix acquired RightSignature.
“If you look at the 12 to 14 vendors in my research, more than half of them have been gobbled up,” Le Clair added.
Despite the level of activity, and the growth in transactions, Le Clair said there’s one problem: Electronic signatures is not a very big market. He guesses it’s close to $500 million annually. “If you do the math there’s no way the amount of money put into DocuSign could be justified doing the signature part of the process,” he said.
That’s why DocuSign and other companies are trying to expand their offerings from just signature gathering, which is a complex and legally challenging task, to overall document management. Last week, DocuSign said it raised the money, in part, to pay for future acquisitions and to fuel future growth, which will come from document management.