Article by: Ian Lopez, Legaltech News
Its first move following major investment, Ipro looks to a new technology area in an increasingly consolidating e-discovery marketplace.
When it comes to vendor choices, the e-discovery market is increasingly becoming a smaller place. And judging by the activity of recent years, acquisitions and strategic partnerships seem to be the favored method for scaling. Arizona-based e-discovery provider Ipro Tech first ventured down this path after being bought by investment firm ParkerGale. And as Ipro CEO Kim Taylor told Legaltech News, Ipro “sold with the upfront intention to make a few acquisitions.”
On August 1, Ipro made its first of those acquisitions, purchasing inData Corporation, a fellow Arizona company best known for its trial presentation software TrialDirector. The moves allows for the integration of Ipro’s Automated Digital Discovery (ADD) platform with inData’s trial and deposition management offerings.
The intent for users is to be able to shift between e-discovery and trial programs without having to leave a single platform. Speaking about inData’s users, CEO and president Derek Miller told LTN, “Ideally, they’ll be able to add on a subscription piece. … And those that want to just go to trial will still be able to just go to trial.”
When it comes to pricing and subscriptions, Taylor noted that “all that has to be figured out.” He added that Miller and inData CFO/COO Scott Palmer will “move over into different roles” with Ipro, and that over the next three months, all of InData’s employees will “be integrated into Ipro.” The terms of the acquisition have not been disclosed.
For Ipro, the benefits of the acquisition are twofold. For one, it allows the company to make its way into trial technology, a market often overlooked in e-discovery M&A. Further, it is also the company’s first attempt since being purchased to make a play in the increasingly consolidating e-discovery market, which is currently witnessing major companies like kCura, DTI Technology, Lighthouse, and LDiscovery take significant market shares.
“One of the reasons we did the [ParkerGale] deal back in April was to make sure that we have the resources to compete,” Taylor said. “If you look, the other companies out there, whether its kCura or the cloud companies or whatever, they’re out trying to steal my lunch money every day. And they’re only getting bigger and better, so we have to keep up. We do believe if you look at TrialDirector, it’s a household name on the law firm side. … It gives us access to those folks and really helps us kind of get a stronger footing.”
The market is indeed rapidly shifting. In July 2016, Epiq Systems was purchased by DTI for $1 billion, while OpenText acquired Recommind for $163 million. This past June, contract data discovery company Adsensa was acquired by Exari.
And while the e-discovery space becomes the domain of fewer and fewer companies, it remains to be seen whether companies like Ipro can engage in their own acquisition strategies to compete. Mark Yacano, global practice leader of managed legal services at Major, Lindsey & Africa, told LTN that the acquisition is “endemic of the challenges that businesses are facing to stay relevant.” Discussing major players, he described how Relativity, despite moving to the cloud and having partners “wondering how that will impact them, kCura still has an enormous market share.”
“Folks like Ipro have to find a hook, have to find a differentiator,” he said. “I’m surprised it’s taken this long for a provider to integrate with the trial presentation and trial preparation function, because logically they do make sense to pair. But whether or not that’s a significant enough differentiator for Ipro to build market share, I think that’s going to be very, very interesting.”