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WorldStream: improving
virtual conferencing
By Gestin
Suttle, LocalBusiness.com
Jan 24, 2001 10:52 AM ET
SEATTLE, Jan. 24 (LocalBusiness.com) -- It's not that Mir Hajmiragha has
anything against paper.
He just thinks that there has to be an alternative to sifting through legal
documents for mortgage loans, lawsuits and the like.
With that in mind, Hajmiragha founded DocuTouch, a company that lets people
sign, send, store and access legally binding documents online.
A better way
The idea for the company came to Hajmiragha, a
five-year veteran of Microsoft Corp., after experiencing two paper-intensive
legal events: the refinance of his home and a lawsuit he and his Bridal Trails
neighbors got involved in against another neighbor.
As anyone who's gone through a mortgage refinance can confirm, the paperwork
seems never-ending -- and confusing, Hajmiragha said. He hadn't seen most of the
documentation until just before closing.
"You have no clue after about the 10th one what you're signing," he said. "That
didn't go down well with me."
And, Hajmiragha realized there was room for improving the legal process after
witnessing the lawsuit, where about four attorneys took the first two hours of
court time rifling through boxes.
"The first two hours of this court time, these guys were exchanging documents
(and saying things like), 'You have this one? No?' 'I don't have this one,'
(and) 'I forgot to give it to you,'" Hajmiragha said.
All while their meter continued to churn at $300 an hour each, he added.
"I'm a problem-solver by nature," Hajmiragha said. "I said, 'You know, there's
got to be a better way.'"
Idea becomes reality
Hajmiragha launched his firm in November 1998, two years before the U.S. digital
signature law went into effect. The company therefore had to figure out how to
make its application legitimate on its own, Hajmiragha said.
"We had to actually put processes in place that were legally binding even back
then," he said. The firm "looked at current social norms, such as notary
publics" and made them part of the process, Hajmiragha added.
DocuTouch is an application service provider that offers its service via the
Internet. Customers can gain access with their PCs or Web-enabled Palm device.
The software allows users to work with clients on documents and edit documents
with others in real time. In order to use the electronic signature, users fill
out and submit a digital certificate application and get it notarized. Clients
may use DocuTouch's Notary On Call service when submitting the application
online. After submitting the application, a notary telephones the user within
two hours, then comes to their location to notarize the application.
Once notarized, users get an e-mail message explaining how to install their
digital certificate, which is good for as many documents as they want to sign.
After that, the digital certificate that is attached to a user's document acts
as his electronic signature.
It's free to register with DocuTouch, but each document accessed, uploaded or
signed costs $1.
E-signature law will boost business
Hajmiragha said the passage of the digital signature law that went into effect
in October will help spur business. The law basically says a signature cannot be
turned down simply because it's in electronic form.
"It's taking longer than I thought" for companies to sign up, Hajmiragha said.
"The law got signed in July, but people didn't start noticing it until October
(when it took effect)," he said.
The firm has 1,200-1,500 users right now, which comprise 40 to 50 small- to
medium-sized firms, with about 800 of those users active, he said. But DocuTouch
is targeting larger corporations, mostly Fortune 500 firms in the mortgage,
banking and insurance fields.
Hajmiragha said he had hoped that DocuTouch would by now have contracts signed
with 10 Fortune 500 firms. "We currently have five signed contracts" that are in
various stages of development, he said. Another five are in other stages of
discussions, Hajmiragha added.
Hoping for the bandwagon
Those deals are not ready for public release, Hajmiragha said. But once the
company announces a major player, Hajmiragha trusts it will have a bandwagon
effect and business will soar.
"Let's say tomorrow we pick up a very huge bank.... You can bet people will
start talking about it to us," Hajmiragha said.
The interest would come not just from other banks, but also from big players in
other industries, plus any companies that contract with the major bank,
Hajmiragha predicted. DocuTouch already has a couple of major deals; it's just
waiting to finalize them before releasing the companies' names, Hajmiragha said.
He believes the big flurry of activity is three to six months out. The company
is already gaining traction in Japan because of its partnership with Mitsui &
Co. Ltd., which is a household name there, Hajmiragha said.
Meanwhile, minding the cash
Until the registers start ringing, Hajmiragha is watching his dollars and cents.
He is also in hot pursuit of another $10 million in funding, which he hopes will
close in about three months. The company is operating on an initial $9 million
in financing.
"We are a start-up, (and) like any other start-up, you are always managing cash
and dealing with market constraints," he said.
"We did not start in a good market that actually funds companies very easily,"
he added. Therefore, "We're being very frugal about our cash management."
So far the company has not had to lay off any employees, Hajmiragha said.
As for now, the future looks bright, with deals in the wings about to be
announced, Hajmiragha said. He estimates the worldwide market for digital
documentation is in the $1 trillion range.
"You can see, anywhere you are going to have an electronic transaction (that is
legally binding), we play a role," he said. "So it's a huge market."
COMPANY: DocuTouch Corp.
INDUSTRY: Internet
PRODUCT/SERVICE: An application service provider whose technology allows users
to securely sign, audit, send and store legally binding documents online.
YEAR FOUNDED: 1998
MANAGEMENT: Mir Hajmiragha, president, CEO and founder. Hajmiragha's prior work
including positions at Microsoft Corp. and PriceWaterhouseCoopers. As the
infrastructure engineering group manager at Microsoft, he was responsible for
the organizational development and launch of the software giant's Internet
presence and its core download sites around the world. At
PriceWaterhouseCoopers, Hajmiragha was responsible for developing an Internet
consulting organization, as well as managing client projects.
Jim Doyle, chief information officer. Before joining DocuTouch, Doyle ran an
information management services consulting company. He has also held MIS
management positions with United Gas Pipe Line Company and Production Operators
Inc.
Jim Horton, financial and administrative director. Past positions include work
as the general manager of United Western Supply, a Fairmount Minerals Company.
Louis Hazim, director of sales. He recently was president and founder of
Kirkland-based Technologix, an IT resources firm.
Mark Sanders, corporate legal counsel. He oversees the company's contract
negotiations and issues relating to statutory compliance, liability,
intellectual property, financing, and corporate management. Sanders was most
recently a partner with Coe and Sanders, PLLC, where he maintained a practice
that focused on providing legal counsel to start-up and emerging technology
companies.
Amber O'Brien, director of Human Resources. Prior to joining DocuTouch, O'Brien
was the director of human resources for e-software inc., based in Bellevue.
EMPLOYEES: 52
INVESTORS: DocuTouch has raised $9 million to date from venture investors,
including Timberline, the Northwest affiliate of Draper Fisher Jurvetson; Irwin
Ventures, an affiliate of Irwin Financial Corp.; Mitsui & Co. Ltd., a world
trading and investment company in Japan. DocuTouch is now seeking $10 million in
private placements to maintain its market position and momentum, as well as
accelerate expansion into Asia Pacific and European markets.
STRATEGIC PARTNERS: Technical partners include: Exodus Communications, PC
DOCS/Fulcrum, RSA Data Security Inc., VeriSign and KMC Signing Services Inc.
Marketing partners include JurisDictionUSA, Legal Club of America, LoanStreet,
NowDocs, Palm Inc., Phone.com, Prairielaw.com and UPS. Its global partner is
Mitsui & Co. Ltd.
COMPETITORS: Hajmiragha considers eOriginal Inc. of Baltimore the main
competitor, although most of the other firms in the online documentation space
offer only part of what DocuTouch offers -- such as document archiving, he said.
CUSTOMERS:Primarily, Fortune 500 financial services, mortgage lending,
insurance, and leasing companies. The company's secondary markets include the
healthcare and governmental sectors. Additionally, the company has made
strategic inroads in Asia Pacific markets through its business partnership with
Mitsui & Co.
FISCAL YEAR REVENUE: About $20,000 in 2000. Anticipates profitability in 2002.
WHAT KEEPS YOU UP AT NIGHT? "Nothing, really. I sleep pretty well," Hajmiragha
said. Otherwise, he echoes the concerns of other startup CEOs. "Dealing with the
product coming online, establishing brand, (etc.).... This is no different from
any other (emerging) business."
CONTACT: DocuTouch, 999 Third Ave., Suite 3930, Seattle, WA 98104. Phone:
206-224-3789. Fax: 206-224-4982. E-mail:
support@docutouch.com.
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