This article did not shock me at all but somehow looking up the numbers on Docusign made me wonder, seriously, and with all due respect: how would you get to 7,400 employees at Docusign? I literally can't do back-of-the-napkin calculations that make it plausible.
For SAAS companies that do B2B it's important to remember two arms of the company:
1. Sales -> You can hire a lot of sales people if they're generating enough business to cover their own salaries
2. Customer Support -> Big enterprise contracts generally have support written into them. Thus, for every enterprise customer Docusign may need anywhere from 0.1 -> 3 (or more) FTEs. If you price this right it's always worth it to keep growing the org this way.
Docusign has a lot of opportunities to upsell customers on legal services they provide.
You should also consider the scaling cost of internal support. For every 10 FTEs, add a manager. Also add on HR, accounting, janitorial, etc. Easilly 20% of the company might be these sorts of internal support roles.
Don’t forget that signing is primarily a legal activity. Every jurisdiction handle it differently, and it’s important to be able to articulate what your product can and can’t do.
This was particularly relevant during the dark days of COVID lockdowns and quarantined, where those laws and practices were tested to their limits.
They likely outsource a lot of that regional work, and do so on an ad hoc basis, but they still need knowledgeable people to coordinate it.
"As of January 31, 2022, we had 7,461 employees, of which approximately 67% were in sales, marketing and customer success, 20% in engineering, product development and customer operations and 13% in general and administrative. We had approximately 69% of our employees based in the U.S. and the remainder in international locations."
> 67% were in sales, marketing and customer success, 20% in engineering, product development and customer operations and 13% in general and administrative
Ratios like this are fairly common.
I think the confusion comes from engineers who look at a SaaS and assume it's mostly engineers like themselves. Engineering is a small portion of the headcount.
A lot of customer-related needs scale with the number of customers. Any company with a huge number of customers is going to have a lot of headcount related to dealing with customers.
One common driver of headcount is enterprise sales and support. Once you charge at least $75,000/year, you need to put salespeople on planes, you need to provide actual tech support, and (unless you're disciplined and lucky) you end up with hundreds of features that are only used by one or two big customers each.
Enterprise software is fundamentally a whole different beast. Customers will write big checks, but they expect a lot of different things in return for that money.
You've described my company to a T. We aren't even that big and our customer service, sales, and marketing department make up about 80% of our workforce (even though we are SAAS).
It's quite easy to figure out if you look at their annual report, for example. [1]
Literally the first two pages of content explain, emphasis mine:
> To address this opportunity, our sales and marketing strategy focuses on businesses at all scales, from global enterprise to local very small businesses (“VSBs”). We rely on our direct sales force and partnerships to sell to enterprises and commercial businesses, and our web-based self-service channel to sell to VSBs, which is the most cost-effective way to
reach our smallest customers.
> Hundreds of integrations with other mainstream systems where work gets done, such as applications offered by Google, Microsoft, Oracle, Salesforce, SAP, and Workday.
> Globally adopted. Our expertise in electronic signature and other agreement technologies is truly global. This is key, given that different regions have different laws, standards and cultural norms. We assist multiple parties in different jurisdictions to complete agreements and other documents in a legally valid manner
> Vertical offerings. We offer enhanced solutions tailored to particular industries, such as financial services, real estate, life sciences, and government. In some cases, these may be variants of a product like DocuSign eSignature —for example, our additional DocuSign eSignature options for assisting with compliance with U.S. Food and Drug Administration regulations. In other cases, it may be a distinct product for an industry, such as Rooms for Real
Estate, which includes task management, templates, and workflow for real estate transactions.
You can see from their expenses that they spend two and a half times as much on sales and marketing than they do on research and development.
It's very easy to imagine how you could need 2,000 engineers to build and support e.g. 500 different integrations and 50 industry-specific solutions, all of which need to be actively maintained for compatibility. And then an even larger salesforce that is selling to companies literally across the globe. Not to mention the lawyers and legal analysts attached to all of those.
Docusign isn't a mere PDF viewer computer program, it's a business that provides ironclad legal services that are vetted by lawyers and guaranteed for your industry's specific legal needs in the countries where you operate.
I have no horse in this race other than being a Docusign enterprise HIPAA plan customer for my org of ~150 people, but: IME Docusign is absolutely at the tiptop of product quality, documentation, and service for any SAAS company I've ever used in the last 16 years. Whether that requires 0.74, 7.4, or 7.4 million employees is up to them.
Knowing a few people there work there... They have teams that work with specific customers to customize their product. I'm guessing a large client like Google could have a team of 100+ folks alone working on that client (across sales, tech, support).
The other thing is that they do stuff outside of just signing documents. They are a software company. They work in the enterprise space too. That ends up pulling in a ton of people to support those large clients.
Could they cut a lot of folks? Sure. But just about every large company could.
They're mostly sales, marketing, and customer service. Engineering is mostly supporting integrations with every arbitrary platform and CRM they can possible handle.
There is no limit to how high headcount can go, for virtually any business, unless something stops it. That doesn't mean anyone is intentionally padding the rolls, either. There is a certain momentum, as more people requires more supervisors and more support and more support for the support. 7400 people have a lot of company computers/IT, human resources requirements, payroll and accounting, etc. More people "requires" more people, in an ever-increasing spiral of hiring...until suddenly there is a hard stop that requires it to not increase, or even decrease.
I have witnessed this in corporate, startup, university, and governmental organizations, so it's not much to do with the task to be done. More people requires more people, until and unless something else requires that there be less people instead.
For Docusign, we have apparently just encountered that "something else".
I am always amazed when I hear company x laid off 600 workers and I"m like, "how did they have that many people working there?" I know it is probably sales and stuff but it it still seems unreal.
I've never had an office job and so it is like some kind of urban legend for me (Like I grew up in the country so I never knew anyone that actually went to summer camp, so I thought it was a fake thing made up for movies and tv.) Even though I'm nearly 50 I still relate to that tiktok of the woman asking what people do in an office all day https://www.tiktok.com/@mads.ringswaldegan/video/70920553756...
For reference, I've worked in companies of 500-1000 total employees where the companies designed, manufactured, sold and dealt with regulators all for things like artificial hearts (lvads), surgical robotics systems, etc. How is docusign 10x mor complicated?
In my experience if the "what the company does" headline seems too trivial then you have to dig deeper to understand what they're really doing. Business at scale tends to have fractal-like complexity and a lot of the work goes into fighting entropy rather than building the really obvious customer-visible stuff. See also why Uber's app is almost 400MB or why Twitter has 7k employees. On the other hand Weyerhaeuser manages millions of acres of land on only around 2k employees. Always in the details.
I feel the same way about most big corporations. Tech companies are not immune. I had a FB recruiter once brag to me about their Messenger team occupying a couple floors in Seattle and a couple floors in Menlo Park. Holy hell, what do you do on a project like Messenger with that many devs??
What to recalibrate on,
is that this is what a well funded $580 million revenue per quarter org looks like. You could certainly build a leaner org, with just 50 engineers, and way fewer features, but it's not going to be the industry stronghold that DocuSign is, not without some sort of competitive advantage (like when the Internet was new and you're competing as against companies that haven't digitized yet, but even then).
Products get complicated when you're trying to be #1 in the world.
It might take you a few months to slap together your MPV with a couple of devs, but several years later you need a 10 person team to work full time on the location autocomplete function because having your location autocomplete be 10% better than a competitor makes you millions of dollars.
[+] [-] Hermitian909|3 years ago|reply
1. Sales -> You can hire a lot of sales people if they're generating enough business to cover their own salaries
2. Customer Support -> Big enterprise contracts generally have support written into them. Thus, for every enterprise customer Docusign may need anywhere from 0.1 -> 3 (or more) FTEs. If you price this right it's always worth it to keep growing the org this way.
Docusign has a lot of opportunities to upsell customers on legal services they provide.
You should also consider the scaling cost of internal support. For every 10 FTEs, add a manager. Also add on HR, accounting, janitorial, etc. Easilly 20% of the company might be these sorts of internal support roles.
[+] [-] greggsy|3 years ago|reply
[+] [-] thedougd|3 years ago|reply
[+] [-] MattGaiser|3 years ago|reply
[+] [-] giantg2|3 years ago|reply
[+] [-] chrisseaton|3 years ago|reply
[+] [-] babyshake|3 years ago|reply
It won't be long before GPT-3 or its successors will be putting many people out of a sales or support job.
[+] [-] razwall|3 years ago|reply
"As of January 31, 2022, we had 7,461 employees, of which approximately 67% were in sales, marketing and customer success, 20% in engineering, product development and customer operations and 13% in general and administrative. We had approximately 69% of our employees based in the U.S. and the remainder in international locations."
[+] [-] PragmaticPulp|3 years ago|reply
Ratios like this are fairly common.
I think the confusion comes from engineers who look at a SaaS and assume it's mostly engineers like themselves. Engineering is a small portion of the headcount.
A lot of customer-related needs scale with the number of customers. Any company with a huge number of customers is going to have a lot of headcount related to dealing with customers.
[+] [-] petesergeant|3 years ago|reply
[+] [-] mikequinlan|3 years ago|reply
[+] [-] simonw|3 years ago|reply
[+] [-] tomcam|3 years ago|reply
[+] [-] ekidd|3 years ago|reply
Enterprise software is fundamentally a whole different beast. Customers will write big checks, but they expect a lot of different things in return for that money.
I don't know whether this applies to DocuSign.
[+] [-] cogman10|3 years ago|reply
[+] [-] crazygringo|3 years ago|reply
Literally the first two pages of content explain, emphasis mine:
> To address this opportunity, our sales and marketing strategy focuses on businesses at all scales, from global enterprise to local very small businesses (“VSBs”). We rely on our direct sales force and partnerships to sell to enterprises and commercial businesses, and our web-based self-service channel to sell to VSBs, which is the most cost-effective way to reach our smallest customers.
> Hundreds of integrations with other mainstream systems where work gets done, such as applications offered by Google, Microsoft, Oracle, Salesforce, SAP, and Workday.
> Globally adopted. Our expertise in electronic signature and other agreement technologies is truly global. This is key, given that different regions have different laws, standards and cultural norms. We assist multiple parties in different jurisdictions to complete agreements and other documents in a legally valid manner
> Vertical offerings. We offer enhanced solutions tailored to particular industries, such as financial services, real estate, life sciences, and government. In some cases, these may be variants of a product like DocuSign eSignature —for example, our additional DocuSign eSignature options for assisting with compliance with U.S. Food and Drug Administration regulations. In other cases, it may be a distinct product for an industry, such as Rooms for Real Estate, which includes task management, templates, and workflow for real estate transactions.
You can see from their expenses that they spend two and a half times as much on sales and marketing than they do on research and development.
It's very easy to imagine how you could need 2,000 engineers to build and support e.g. 500 different integrations and 50 industry-specific solutions, all of which need to be actively maintained for compatibility. And then an even larger salesforce that is selling to companies literally across the globe. Not to mention the lawyers and legal analysts attached to all of those.
Docusign isn't a mere PDF viewer computer program, it's a business that provides ironclad legal services that are vetted by lawyers and guaranteed for your industry's specific legal needs in the countries where you operate.
[1] https://s22.q4cdn.com/408980645/files/doc_financials/2022/ar...
[+] [-] Optimal_Persona|3 years ago|reply
[+] [-] unknown|3 years ago|reply
[deleted]
[+] [-] jdoliner|3 years ago|reply
Those poor workers, I hope they'll be able to find something new and provide for their families.
Hacker news:
Good, that company had too many employees anyway.
\s in case it's not obvious
[+] [-] MattGaiser|3 years ago|reply
[+] [-] AlwaysRock|3 years ago|reply
The other thing is that they do stuff outside of just signing documents. They are a software company. They work in the enterprise space too. That ends up pulling in a ton of people to support those large clients.
Could they cut a lot of folks? Sure. But just about every large company could.
[+] [-] austenallred|3 years ago|reply
[+] [-] rossdavidh|3 years ago|reply
I have witnessed this in corporate, startup, university, and governmental organizations, so it's not much to do with the task to be done. More people requires more people, until and unless something else requires that there be less people instead.
For Docusign, we have apparently just encountered that "something else".
[+] [-] jccalhoun|3 years ago|reply
I've never had an office job and so it is like some kind of urban legend for me (Like I grew up in the country so I never knew anyone that actually went to summer camp, so I thought it was a fake thing made up for movies and tv.) Even though I'm nearly 50 I still relate to that tiktok of the woman asking what people do in an office all day https://www.tiktok.com/@mads.ringswaldegan/video/70920553756...
[+] [-] iancmceachern|3 years ago|reply
[+] [-] hedgehog|3 years ago|reply
[+] [-] wenbin|3 years ago|reply
So each employee generates ~$320k annual revenue ($2.4B / 7,400), which sounds about right.
SaaS companies typically do low $100,000s per employee per year.
[1] https://www.docusign.com/press-releases/docusign-announces-f...
[+] [-] rootusrootus|3 years ago|reply
[+] [-] jcims|3 years ago|reply
https://www.linkedin.com/search/results/people/?currentCompa...
'DocuSign' is a company and a product. The scope of the company is much greater than the product. I wouldn't guess less than 3000 for sure.
[+] [-] aendruk|3 years ago|reply
[+] [-] fragmede|3 years ago|reply
[+] [-] globular-toast|3 years ago|reply
[+] [-] nine_zeros|3 years ago|reply
[+] [-] dschiavu|3 years ago|reply
[+] [-] leros|3 years ago|reply
It might take you a few months to slap together your MPV with a couple of devs, but several years later you need a 10 person team to work full time on the location autocomplete function because having your location autocomplete be 10% better than a competitor makes you millions of dollars.