Exterro has acquired eDiscovery rival Zapproved, in a move that the fast-growing private-equity-backed company says will further its vision to provide customers with everything they need to manage their legal governance, risk and compliance obligations under one roof.
Exterro, which in August last year completed a recapitalisation valuing it at over $1bn, says that the convergence of areas such as privacy and digital forensics & incident response, including e-discovery, has created a need for a unified solution that can identify and manage data quickly and cost effectively.
“I have known Monica Enand, president & CEO of Zapproved, since the early days of both of our companies’ origins in Portland, Oregon,” said Bobby Balachandran, CEO & president of Exterro. “Since inception, we have shared a common vision for providing market-leading software and support for our clients and partners, and the combination of Exterro and Zapproved will continue that vision by delivering enhanced value to our constituents.”
Founded in 2008, Zapproved is often described as a pioneer of cloud-based software for corporate legal departments. According to Crunchbase, it has nine investors including Vista Equity Partners (which it sold a majority stake to in 2017) and K1 Investment Management.
Enand said: “Zapproved’s mission has always been to make our customers ridiculously successful. We are confident that combining Exterro’s innovation engine with Zapproved’s world-class customer experience brings the best of the industry together in one powerful and easy to use solution that comprehensively addresses the critical business challenges facing our customers today.”
Exterro, which is a portfolio company of Leeds Equity Partners, last year secured additional equity capital to continue the rapid growth that has already seen it acquire Jordan Lawrence and AccessData.
Since Leeds Equity’s initial investment in 2018, the company has more than quadrupled its revenue, and now serves more than 3,000 customers globally as it heads towards an IPO.
Speaking to Legal IT Insider in August last year, Balachandran said: “I started the business in 2008 and grew pretty much bootstrapped until three and half years ago. We were growing really fast and saw the opportunity to grow both organically and non-organically. We had the best private equity funds wanting to be part of our story.”
He added: “We are looking to go public next year to provide an opportunity for existing investors to provide liquidity. So we are going to double down on our roadmap; accelerate our innovation; and double down on our M&A.”
In a sign of what has now come to pass with today’s news, Balachandran said: “We see a significant amount of convergence between markets. When you drill deeper, it’s all a data problem: do you know where your information is? How do you get access and how do you manage the workflow? What is happening is that the GCs become the risk quarterback and he or she is in charge of dealing with not just litigation but cybersecurity and all the other work. The way we see it, is that it is all converging under the GC. There were days when we had cameras and music devices and they all worked separately but once they were all put together, you couldn’t imagine them being separate any more. The benefit that customers get from managing their data holistically is significant – both in terms of cost savings and being able to manage the whole thing much more easily and efficiently.
“We are in four big markets and have the opportunity to pick and choose some really deep tech companies who have done extremely well and add to our ability to provide more capability quickly.”
caroline@legaltechnology.com