Jay Parkhill September 26th, 2007
Dave McClure posted a rant the other day about how VCs and technology lawyers spend a lot of time around startups, but rely on antiquated communication systems (fax!) to do deals.
He’s right, but what’s interesting to me is *why* “[we] guys are still in the 80’s”. Digital signatures are perfectly legal, but no one uses them.
I think the reason is that everyone spends so much time thinking about the deal itself, that no one puts much effort into the mechanics of completing it. Fax mostly works because most people have fax machines.
On the flip side of the coin, in just about every deal I’ve ever done I have ended up chasing someone for a signature. Someone is inevitably travelling or not near a fax machine. Internet access is so ubiquitous- I would love to have a “virtual closing room” on my website where people could log in and digitally sign documents. This would save a huge amount of time and energy on my part and presumably everyone else’s.
It takes two sides to close a deal, though, which is probably the other big reason things like this haven’t taken off. To do it right, I would have to (a) provide each party to the deal with login information and a way to authenticate individual identities, or (b) somehow coordinate my digital signatures with the other side’s, or some combination thereof.
It’s worth a try, though. Can anyone tell me how to build such a facility?