An Ottawa company that helps some of the world’s biggest brands identify, investigate and prevent fraud, workplace harassment and other types of corporate malfeasance is banking on a major investment from a U.S. private equity firm to extend its reach into new global markets.
Case management software provider i-Sight announced last week that Resurgens Technology Partners, an Atlanta-based private equity firm that specializes in scaling up software enterprises, is adding the Ottawa company to its portfolio.
Terms of the deal were not disclosed. Under the agreement, i-Sight co-founder and chief executive Joe Gerard is leaving the company and will be replaced by David McNeill, a 30-year tech veteran who most recently served as chief operating officer of another Resurgens portfolio company, Connecticut-based analytics firm Investment Metrics.
Jason Victor, another longtime partner in i-Sight who designed its original software platform two decades ago, will remain in his current role as chief technology officer.
“The timing was right,” Gerard told Techopia, explaining his decision to hand over the keys to the business he launched with his father Ray and other partners more than two decades ago.
“The competitor in me has trouble walking away, but at the same time, I feel like we’ve kind of won the game in terms of our expectations of what was possible. I have no doubt in my mind i-Sight is going to continue to thrive. I certainly have no regrets. It’s been a fun ride, and I feel this is probably what’s best for the company at this point.”
"The competitor in me has trouble walking away, but at the same time, I feel like we’ve kind of won the game in terms of our expectations of what was possible."
Founded in 1999, i-Sight has carved out a lucrative niche in the corporate case management space, producing custom software that compiles, stores and analyzes data on all kinds of misbehaviour from violations of federal privacy laws to bullying and harassment.
By creating a “central warehouse” for case file information, i-Sight’s software aims to allow clients to more effectively investigate human resources complaints and spot potential breaches of government regulations.
Among the more than 450 mid-sized and enterprise-level companies that employ its platform are household names like insurance giant Aflac, Costco, video game manufacturer EA, meal-kit provider HelloFresh, Red Bull and Twitter.
The local firm, which made Canadian Business’s Growth 500 list of Canada’s fastest-growing companies in 2018 and 2019, added more than 100 new customers to its roster last year alone. Gerard said preventing and quickly identifying workplace harassment and related issues have become a top priority for corporations worldwide in an age in which incidents that might have been swept under the rug in previous eras can now be publicized to a global audience in an instant on social media – with potentially crippling financial consequences for employers.
“The difference now is everybody has a megaphone,” Gerard said. “Every single slip-up is potential for a huge liability. I think companies recognize that now. They want to make sure that they do something to prevent this stuff.
“This kind of thing is getting attention at a much higher level in the organization. Instead of it being some director of HR in a cubicle in the corner with three investigators, this is coming straight from the boardroom now.”
As i-Sight’s software has grown in popularity, it’s also become easier to mass-produce, Gerard added.
While the firm’s software engineers used to spend countless hours tailoring the platform to each customer’s needs, i-Sight has now gathered enough intelligence on how to spot, probe and curtail nefarious corporate activities that it’s developed a template that can be widely implemented and tweaked as necessary.
“Now we can come to you and say, ‘Look, the best-practice way of doing this is step one, two, three, four, five, six,” said Gerard, who succeeded his father as CEO in 2016. “We’re not showing up with a blank sheet of paper – we’re showing up with an opinion. I think that's what customers want.”
The Gerards, Victor and fellow founder Geoff English financed i-Sight out of their own pockets from the get-go, fuelling the firm’s growth from a startup with 10 customers and a handful of employees in its first year to a global operation with clients on every continent and a workforce of 190 today.
But i-Sight’s management team believes the company is still just scratching the surface. About 90 per cent of the firm’s revenues come from North America, and Gerard and his fellow founders felt i-Sight needed more financial muscle behind it to make significant inroads in other markets.
'We've got the demand'
An unsolicited investment offer last year opened the team’s eyes to the firm’s true potential, Gerard explained. The company then hired Kanata-based M&A consultants Sampford Advisors to lead a search for investors, triggering a wave of interest that led to half a dozen offers.
“We know we have a strong market,” he said. “We’ve got the demand, and I think what we started thinking about is, how do we accelerate the growth of the business to capture this window of opportunity?”
At the same time, Gerard said, he realized the heavy lifting of building a multinational company requires a leader with a different skillset and, perhaps, a bit more disciplined approach than he could provide. He’s confident i-Sight has found that person in McNeill.
“He’s been there, done that a few times now,” Gerard said. “He knows the private equity space. He knows M&A. He’s a very disciplined operator. He’s got a history of growing businesses, and doing it with some humanity.”
As for his future, the 45-year-old tech lifer is looking forward to hanging out with his teenaged kids for the summer and taking it from there. But once Gerard’s self-described “sabbatical” is over, he said there’s no doubt he’ll be back in the software game in some capacity.
“It’s hard to walk away from this stuff,” Gerard said. “I’m young enough, I still have energy. I’m going to have to find something to keep myself occupied.”