This article originally appeared in the January 2011 issue of INTERNET TELEPHONY Magazine.
Interactive Intelligence (News - Alert) sells unified business communications solutions for contact center automation, enterprise IP telephony, and business process automation. This fall it purchased Global Software Services Inc., which does business under the name of Latitude Software, for approximately $14 million. Latitude sells software and services that aid in debt collection. INTERNET TELEPHONY recently spoke with Bill Gildea, vice president of business development at Interactive Intelligence, about this deal and how it fits into the larger strategy.
Customer Interaction Center is your key product. Tell us about it.
Gildea: CIC is our underlying platform and has PBX (News - Alert), multichannel ACD, and modules including call recording, screen recording, workforce management, analytics tools, post-call surveys and a dialer platform. The dialer does outbound dialing – predictive, progressive, power dialing; it’s a very powerful dialer.
What are you doing to leverage and expand on all of this?
Gildea: I do M&A for the company, and one of our strategic initiatives is to think about ways to layer value-add applications on top of our core CIC platform.
We did a small deal in insurance last year, a company called AcroSoft. They do document management and workflow just for insurers, PNC (News - Alert) and life companies. So that brought to us an application that, again, sits on top of CIC and integrates the CIC and also brings us domain expertise in better positioning our core platform for the insurance market, where we have over 100 customers.
More recently you purchased Latitude. What does Latitude bring to the table?
Gildea: Latitude had a .Net platform, which was compatible with ours; they did not own a dialer, so it’s incremental – a lot of the competitors own a dialer.
They had two core components of their software. The first one is basically a collector’s desktop application. Think about it as CRM specifically for the collection agency. That core desktop application will pop the account so the debt collector in an agency or in a first-party recovery operation will have the entire history of that client – everything from their outstanding balance, to the credit score, to their current employers, or if they’re unemployed. So they’ll have all that information pop that a collector basically needs to talk off the account and try to get a promise to pay.
Latitude’s other product is called AIM, which is their agency management platform. That’s software that allows first-party creditors … to take those portfolios of written-off accounts to … for agencies to work and then send them back reports on the resolutions of those accounts.
What’s the strategy around the integrated CIC/Latitude offer?
Gildea: We have 3,500 customers. We have hundreds of finance-related customers that have some form of in-house recovery, whether they’re finance organizations, mortgage companies, credit unions, auto loan companies, leasing companies, things like that where we’re in the customer service center but we’re not in for the most part their recovery operation. So it’s a good synergistic opportunity.
But why Latitude in particular, and why this deal now?
Gildea: Just because financial services is such a strong vertical for us. It’s like 35 percent of revenue, and again the collections market is good for us.
The second component that gets us excited about Latitude in particular - they grew 46 percent in the last twelve months. There are two key components to their growth. In the agency space there’s the trend toward hosted; Latitude is increasingly providing hosting offerings for collection agencies. Hosted really fits the bill for a lot of these agencies that are not only cost conscious, but their business has significant fluctuations as they win accounts, as they lose accounts over time. So it’s really a financial deliver model that fits them well.
And the second key driver for us that’s very exciting is all the first-party business that Latitude has gotten into in the last year. One of the trends here is that more of these first-party creditors are working these accounts, and they have all these mechanisms to score these accounts on propensity to pay. The bottom line is that more of these first-party organizations are looking for tools to try to recover more debt before they write it off and farm it out. That’s a trend that we’re trying to capture.
What are your plans for future acquisitions? What other verticals are of interest?
Gildea: We’re absolutely continuing to look at other verticals. We’re looking at a whole bunch of different opportunities. We have $85 million in cash roughly before this acquisition. And, absolutely, we’re looking to put that cash to use.
Edited by Stefania Viscusi