Software isn’t eating the world — bureaucracy is

Agreements today: 3 problems with 3 causes

There are three fundamental problems with contracting today:

1. They cost a lot of money (lawyers, fulfillment, compliance).
2. They take a lot of time (3–6 months to sign).
3. They carry huge risks (litigation = ∞ time & money).

There are three main causes that underpin each of these problems equally:

1. Limited trust in the market: The world is complex; there are many companies, and it is difficult to trust that people will do what they say. As a result, your lawyer adds more clauses to protect your rights, which takes more time, costs more, etc.
2. A large back-office is needed to fulfil signed contracts: Some of the agreements Delos currently automates contain over 48 interconnected terms, fees, and conditions. Multiply that by 100 clients, then by 4–6 jobs per month, and you’re looking at exponential back-office growth.
3. Lack of visibility: Most people don’t really know what’s in the contracts they’ve signed.

Overall, if your company’s sales doubled, you’d likely see your back-office grow by 1.7 to 2 times.

The Unacceptable Status Quo

This is what happens with contracts today at every company:

STEP 1: Negotiate and sign agreements (some software speeds this up, but too much time is still spent on the process).

STEP 2: Upload the same contract into various SaaS solutions to manage its fulfillment (on average, companies put one contract into nine different programs).

STEP 3: Still end up doing tons of manual work. Here’s a scary truth: despite the countless Legal Tech tools available, the number one software for contract management today is… Excel.

Why It’s Not Enough

The fundamental problem is that current approaches improve different parts of the contractual workflow but don’t replace it. They offer patches to individual issues but not a cure for the underlying problem.

And the underlying problem is the contract process itself.

And the disease is the contract process itself.

Building contracts as software

Delos’ approach and goal with Autonomous Contracts can be summarized as follows: don’t build software to manage contracts — build contracts as software to manage themselves.

Our starting point is the agreements themselves and how they’re written. Instead of drafting them in natural (or as natural as legalese can be) language, we write them as software. For existing contracts our clients have, we convert or translate them into a software representation.

Benefit #1: Visibility. A contract written as software and stored in a database provides clear and easy-to-access insights into its terms and their consequences. By “software,” we mean structuring the agreement’s words and data as a AI+logic encoding that can answer questions about consequences: “If I’m late on delivery, how much should I pay?” Such a format can be easily queried by the user, providing visibility into the consequences parties may face.

Benefit #2: Back-office automation. Because contracts are written as software, they can be seamlessly integrated with other tools, especially AI Agents, to automate their fulfilment. A Delos Autonomous Contract can receive a Bill of Lading from a shipping software, calculate the correct price while accounting for all conditions (e.g. late deliveries, after hours, delays), and send the inputs to an ERP or accounting system to generate an invoice.

Benefit #3: Trust. Finally, an Autonomous Contract gives both parties a clear understanding of their respective rights and obligations. And because its fulfilment can be automatic — fully in accordance with the terms — it offers a fair mechanism that holds the parties accountable to what they agreed.