By: Nate Bek
In Seattle startup lore, few names carry as much weight as Court Lorenzini. As the founding CEO of DocuSign, he changed the ways we sign documents, creating a digital signature platform that has become ubiquitous in business transactions worldwide. But Court’s journey didn’t start or end with the e-signature giant.
“I’ve had every outcome possible for a founder,” says Court, who started multiple companies after leaving DocuSign, “so I can empathize with every condition.”
In an exclusive chat with Ascend portfolio founders, Court shared lessons from his decades as a founder, exec, and active investor. The session offered a rare glimpse into the mind of a serial entrepreneur.
Court’s journey began in California, where he grew up in an entrepreneurial family. His father, one of the eight people credited with founding Silicon Valley, instilled in him a passion for innovation and risk-taking. After studying engineering at Duke University, Court cut his teeth at Cisco during its hyper-growth years in the 1990s. “I learned a hell of a lot from that,” he says.
But the entrepreneurial bug bit hard, and in 1996, Court left Cisco to start his first company in Seattle. Since then, he's founded four companies, including DocuSign, and has become a prolific angel investor and advisor. Today, he’s focused on helping the next generation of founders navigate startup life.
Court was a recent guest at Ascend's AMA, a monthly session for portfolio founders where experts share insights on relevant topics. He offered perspectives on team building, company culture, business models, fundraising, and the art of knowing when to step aside. Here are the main takeaways from that conversation.
Team Building: Understanding Superpowers
Team composition is a critical factor in determining a startup’s success. Court introduces the concept of “superpowers” — unique strengths that individuals bring to a team, which go beyond skills to capture innate talents that make people exceptionally effective in specific roles.
Reflecting on his early entrepreneurial lessons, Court says, “The most important takeaway was about team development — who to hire, who to partner with, and who the right co-founders were.”
Key points about superpowers:
They are innate strengths, not just acquired skills.
Most individuals struggle to accurately identify their own superpower.
Understanding superpowers is essential for forming complementary teams and assigning optimal roles.
Court says he developed a specialized questionnaire for hiring, designed to help individuals discover and articulate their superpowers. This tool serves multiple purposes:
Identifying the most suitable role for an individual within a company;
forming teams with complementary strengths;
And guiding founders in understanding their own strengths and limitations.
“The dominant reason for failure often traces back to the founding team — who they were, what roles they assigned each other, what skills and strengths they brought to the table, where they were complementary, and where they were in conflict or duplicative.”
Culture as a Core Product
Another key insight Court shared is the importance of intentionally developing company culture.
“I now openly describe culture as a core product of the company,” he says. “If you’re spending a ton of time building your product or service, you should be spending at least as much time thinking about and strategically implementing your culture.”
Court's approach to culture includes:
Elevating culture to equal importance with the company's primary product or service.
Proactively shaping culture rather than allowing it to evolve haphazardly.
Recognizing that a strong culture is crucial for retaining valuable employees.
While Court believes culture should be rooted in trust and respect, he acknowledges that successful cultures can vary based on founders' personalities and company needs.
Key elements of building a strong culture include:
Defining how people should treat each other within the organization.
Establishing guidelines for customer interactions.
Shaping the company's brand image in the marketplace.
Determining which values and causes the company supports or opposes.
Additional resources for culture development:
FounderNexus: A community launched by Court to help entrepreneurs build teams, get advice on current challenges, and learn from successful peers.
“The Culture Code,” by Daniel Coyle and “The Speed of Trust,” by Stephen Covey.
Patrick Thompson’s framework: Designed to maintain a healthy office culture in remote-friendly environments. “We designed our rituals to create a shared understanding, promote psychological safety, foster personal & collective growth, and have fun!”
The Freemium Debate: Why Court Says No
Court took a bold stance against freemium models. This is unusual, especially at the time he was building DocuSign, as many startups were giving away services for free.
“I never gave anything away for free, ever,” Court says.
His arguments against freemium:
Pricing validates product value.
Unwillingness to pay may signal an ineffective solution.
Free users rarely convert, leading to high burn rates without revenue to show for it.
Court uses the example of EchoSign (later acq. by Adobe) to illustrate his point. While EchoSign initially gained more users through its freemium model, it struggled to monetize effectively. Meanwhile, DocuSign's paid-only approach led to sustainable growth and a multi-billion dollar valuation.
“Pricing in the model is one of your most important tools,” Court says. “It's also one of the most important ways you can vocalize and validate how you are valued in this problem stack you're trying to solve. If someone is unwilling to pay you, it might not be worth doing in the first place.”
Fundraising: A Means, Not an End
Court challenges the common startup mindset about fundraising. His perspective shifts focus from raising capital to achieving business objectives.
Key insights on fundraising:
Raise the minimum necessary to hit specific milestones.
Prioritize execution over the amount raised.
Remember: company success is the goal, not securing funds.
“The goal isn’t to raise money,” he adds. “The goal is to take as little as possible to get where you're going — you still need to get to where you're going.”
This approach encourages startups to:
Be strategic about when and how much to raise.
Focus on effective use of funds rather than impressive funding rounds.
Maintain a clear vision of business objectives beyond fundraising.
By reframing fundraising as a tool rather than a goal, Court promotes a more sustainable and focused approach to startup growth. This perspective can help founders maintain control, reduce dilution, and stay aligned with their core business objectives.
The Art of Letting Go: Knowing When to Step Aside
Perhaps one of Court’s most bold yet insightful pieces of advice is knowing when to step aside as a founder. He argues that many entrepreneurs become too emotionally attached to their companies, potentially stunting personal growth.
“I see that all the time,” Court says. “The founder gets far too emotionally connected and cannot remove themselves from the situation. It causes problems for them. It potentially causes problems for the company, depending on their style of leadership and the stage of the venture.”
Court’s philosophy on founder transitions includes:
Understanding that different company stages require different leadership skills.
Recognizing one's own strengths and limitations as a leader.
Being willing to bring in new leadership when the company's needs outgrow the founder's skillset.
He divides a company's lifecycle into three stages:
Stage I: Napkin to product-market fit.
Stage II: Product-market fit through high growth.
Stage III: Growth through profitability.
Court says he’s most suited for the first stage, where he believes aligns most with his personal superpower. He suggests that the best leaders know not just how to lead, but when to change or relinquish leadership for the company's benefit. Court left DocuSign 16 years ago, just five years after the company launched. He decided the mission to scale the company at that point would be better left to another leader.
“If there’s a person that could do that job better, let them do it,” he says. “Your job is to make sure that the company reaches its highest potential.”
Court also offers a compelling data reason for founders to consider leaving their startups: “By the time you have reached your fifth year, you have achieved between 75 and 80% of your terminal value.”
He continues, “After year five, you could stay another 20 years at that company. And you might only accrue another 20 to 25% value.”
Court's advice is to diversify your risk. Start a new company after reaching this equity milestone. This strategy maximizes potential returns while spreading risk across multiple ventures.