The theme of Shaping Tomorrow provided partners with a roadmap for the future.
Above: More than 300 DocuWare partners traveled to Houston for DocuWorld 2024.
Try as they might, severe spring storms could not dampen the excitement and enthusiasm of 300 DocuWare attendees at the U.S. edition of the DocuWorld partner event, which was held in Houston on May 16 and 17. That Thursday evening, the metropolitan area of southeast Texas was rocked by 100-mph, hurricane-force winds (called derecho) that left almost one million homes and businesses without electrical power. Refusing to be left in the dark, some dealer reps played pool by iPhone light at the Stampede nightclub, a massive venue 12 miles from downtown, where the after-party took place.
DocuWare partners mixing and mingling during DocuWorld 2024.
Like sky spotlights, the subsequent 2,500 lightning strikes illuminated DocuWare’s core message for the channel. The key message was clear: The service is no longer just about document management. It’s about automated business processing (ABP), a term that resonates better in the market and is more appealing to potential clients.
Co-president Michael Berger presents a company status report.
Co-president Michael Berger, PhD, proudly announced that DocuWare’s annual sales, which have doubled over the past five years, approached nearly $120 million (USD) in 2023. This significant milestone was further highlighted by the achievement of the invoice quota milestone of 1 million € [euro] in a single day. Berger also noted the company’s successful growth migration, which is up 20% in the cloud, an area where DocuWare has been a pioneer since 2012.
DocuWare has amassed 500,000 users and 1 billion documents over the past dozen years. More than half of the software company’s 19,000 customers worldwide now pay monthly fees to access its cloud solution at a 95% renewal rate, according to Berger, whose central focus is technology. “Seventy-five percent of our business is now based on recurring revenues,” he said.
The company added more than 2,500 new cloud customers last year. Since 2021, cloud extensions are up nine percent to 27%, “which indicates that people are using our product and they like it,” Berger declared. From a global perspective, DocuWare has 100 cloud customers in Japan; 500 in England; and 1,000 in Spain. It acquired German-based DocuScan in mid-2023. Incidentally, Texas ranked first domestically in overall billings last year.
Berger outlined a four-pronged strategy for shaping a more flexible, powerful, and simpler future in the near term:
- Develop intelligent document processing.
- Make content management more fully functional.
- Transition to data-driven workflows for business process automation (as opposed to document-driven).
- Provide decision support so that something can actually be done with the data.
Toward that end, over the past three years, DocuWare has invested some 15 million euros in its cloud-computing and cybersecurity infrastructures, user-experience enhancements, workflow advances, and artificial intelligence.
“Through automation and integration, we are leveraging the functionality of documents…and bringing more clarity to digital processes,” noted Christian Guntsche, senior director of product management at DocuWare. In its quest for more dynamic data, the firm will soon launch Power Automate Connector for business-relevant processes. Enabling companies to gain insights from their data is the next step to helping businesses move forward, and “this product allows for faster customer decision-making,” according to Guntsche. Enhanced integration with Microsoft Teams also is coming.
DocuWare’s 4 Key Vertical Markets
DocuWare’s Jim Roberts discusses vertical markets.
The manufacturing sector represents a large vertical market for DocuWare’s solutions, and Jim Roberts, president of DocuWare here in the U.S., shared three other verticals that are attracting dealer attention throughout the United States. After all, why reinvent the proverbial wheel? “Do more of what already works,” Roberts encouraged his DocuWorld partners in Texas. In addition to manufacturing, here are the Big 3 he identified as proven vertical markets:
- Car dealer networks: There are more than 500 large, U.S. automotive dealers, and DocuWare partners already have 55 active contracts in this sector—20% of which are in the $30,000 range, reported Roberts. From the service, sales, and finance/insurance sides of the car-sales/leasing business, “this segment has doubled for us in the past four years,” he noted.
- School districts: This is another accelerating segment. DocuWare holds 338 K-12 contracts, with the top states being Texas, Pennsylvania, New York, and California. Staffers primarily use the software for records management, storage/retrieval, applications, and related processing. According to Roberts, there are 11,500 public school districts in the United States and another 50,000 private ones. Over the past eight years (excluding the COVID-19 pandemic era), DocuWare has acquired an average of five school-district contracts per month.
- Municipalities and Government Agencies: These markets are signing about seven new DocuWare contracts every month to meet their document storage needs. “Digital transformation often is driven by compliance and regulations,” Roberts explained. That is a big reason why this segment accounts for the fastest and most explosive growth among DW partners, one of which enjoys more than 30 such contracts. The company has 488 contracts with municipalities/government, including 45 in New York alone. The largest is over $130,000 per year, recurring.
DocuWare and AI
On the AI front, DocuWare strives to go beyond the basics of artificial intelligence and increase marketplace competitiveness with semantic search and self-help chatbots. “AI is not just hype,” said Michael Bochmann, senior director of business development and innovation. “AI is a solution looking for a problem; our challenge is to harness and shape it. We need to learn to think like AI; to reimagine work when we think about AI and its influence.” He then cited an IDC consulting statistic revealing that some 90% of all data—from contracts, invoices, and other forms to emails—is unstructured.
Bochmann pointed out that building an OpenAI ChatGPT engine into your own products merely scratches the surface. “We want to own the technology,” he explained. Hence, this past April, DocuWare acquired natif.ai, a firm situated on the campus of Saarland University, a public research university in Saarbrücken, Germany. Added to the DocuWare price list for dealers on May 1, its AI Document Automation Platform fits in with the parent company’s strategy of intelligent document processing.
The natif.ai technology is a large-document model that does not require rule-based layers, unlike large-language models such as ChatGPT. Berger stated: “We aim to enhance business insights and decision-making for our customers via natif.ai’s document-based process automation and cloud AI tools.” Founded in 2019, the natif.ai motto is “We Educate Machines.” The company employs more than 50 AI experts who presently process approximately 5 million documents monthly for some 70 clients, according to co-founder Johannes Korves.
“Customized data extraction is the key for us,” he told the DocuWorld attendees gathered in Houston, adding that using barcodes is “so ’90s.” Based on huge Transformer technology, the general document AI has been trained to have general document understanding, explained Korves. “So, it understands documents like a human, but you don’t have to be an engineer or AI expert to train the system.”
Communicating with text and visual information, natif.ai can accurately process PDF and JPG files in A4-sized formats. “It reads precisely and understands index fields and data points,” Korves illustrated. Robust optical-character-recognition (OCR) technology also employs graphics processing units (GPUs) for handwritten text recognition (HTR) to decipher handwriting.
By September, the new interface should be ready for testing, and then, by March 2025, a combo version will incorporate DocuWare’s intelligent indexing features. One important distinction from the ChatGPT large-language model is that the natif.ai large-document model has the ability to remove sensitive, personal information. “We believe this AI will change things forever,” concluded Bochmann. “Using it to generate code, for example, is a huge time-saver.” Guntsche offered an additional big-picture perspective: “Our vision is to achieve full automation via seamless capture powered by AI.”
DocuWare at a Glance
- Parent Company: Ricoh Corp. (acquired in 2019)
- Global Headquarters: Germering, Germany
- U.S. HQ: Beacon, NY
- Employees (worldwide): 600 in 18 countries (and 50 nationalities)
- Customers: 19,000 (approx. 10,000 are using the cloud solution)
- Annual Sales: 110 million € (euro) in 2023
