Interactive Intelligence Collects Latitude Software for $14 Million
When information technology titans such as Cisco Systems and Avaya are your direct competition, the ability to adapt and improve your product offerings are essentially your only hope for survival. For Interactive Intelligence, "adapting" has turned out to be just another word for "growing," which is why the provider of unified Internet Protocol (IP) business communications solutions — in an effort to expand its position in the collections vertical — recently acquired Latitude Software, a provider of debt-collection software and services, for $14 million in cash.
The move, according to executives, will allow the company not only to integrate Latitude's technology with Interactive Intelligence's Interactive Dialer application, but also to capitalize on Latitude's customer base of collection agencies, first-party creditors, debt buyers, and law firms.
"Latitude's offering — backed by 13 years of industry experience — will augment our growing presence in the debt-collection vertical," said Donald E. Brown, Interactive Intelligence's founder and chief executive officer, via company press release. "[In debt collection] we continue to see increased demand for our all-in-one IP communications software suite and sophisticated outbound-dialing functionality."
Interactive Intelligence executives say that, in addition to the integration with Interaction Dialer and third-party dialer products, Latitude Software's suite will continue to be available as a standalone solution. Latitude itself will operate as a subsidiary of Interactive Intelligence, maintaining its current headquarters and its roster of approximately 40 employees.
The collections industry has become increasingly competitive, according to Joe Outlaw, principal analyst at business research and consulting firm Frost & Sullivan. At the same time, government restrictions such as the Do-Not-Call legislation have made the collections business more complex.
"As companies are trying to do their collections, they want to be more efficient and more effective and comply with these increased regulations," Outlaw says. "Interactive Intelligence recognized that you're either going to have to get a lot stronger and more focused or you're just going to fall by the wayside. Only the most competitive companies offering collections solutions and outbound-dialing solutions are going to win the day. Those companies that don't commit to becoming stronger and more focused are not going to be able to hang onto their business."
And Interactive Intelligence executives insist the company has no intention of taking a breather just because it has expanded its collections expertise. The ongoing goal, according to Bill Gildea, the company's vice president of business development, is to examine other technology that may prove synergistic to Interactive Intelligence's current offering.
"We're absolutely in the market for other vertical applications that augment our all-in-one solution," Gildea says. "We're not looking for something that fills a ‘product gap.' We're not market consolidators like some of our competitors [are]."
Most observers immediately characterized the purchase of Latitude, which has no outstanding debt, as a relatively safe acquisition for Interactive Intelligence. In the 12 months prior to Sept. 30, Latitude recorded revenue of roughly $7.8 million, a 46 percent increase compared to the previous 12-month period.
"By joining Interactive Intelligence we believe that we can accelerate this growth," said Carl Harkleroad, Latitude's founder and president, via press release.
"We did a lot of work over almost a two-year period to define the right application fit in the collection space," Gildea says. "[We wanted] everything from a .Net platform that maps a Microsoft-based platform, to the [right] people, to the [right] fit."
Latitude, Gildea says, met each and every one of Interactive Intelligence's criteria.
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