LexisNexis Acquires Interface Software
Interface Software, a CRM specialist for professional services companies, has been acquired by LexisNexis U.S., best known for the extensive reference databases it provides to law firms and other research institutions. Financial terms of the acquisition were not disclosed. "LexisNexis is such a well-known, high-reputation company...it's an opportunity to have a stronger brand and a larger sales and marketing reach, which will help us sell more product," says Nathan Fineberg, CEO of Interface Software.
Founded in 1991 by IBM veteran Terrance Holt, Interface has become a high-profile player in its chosen niche. The company boasts that more than 70 of the nation's top law firms use the core InterAction product. That deep penetration and the implications of a slowdown in growth may have contributed to the sale, according to Denis Pombriant, principal analyst at Beagle Research. "There are a lot of smaller law firms that need [Interface's] technology, and I think to get to the right price points, they had to team up with somebody like LexisNexis."
Interface is not the only company recently pulled into the LexisNexis orbit. In addition to a campaign to acquire other major providers of research and publishing for the legal market, the company has also purchased leading time and billing management programs serving the industry. "I don't think LexisNexis is getting into the CRM market, but it has [more] of high value to offer that customer base of attorneys," Pombriant says.
That view is consistent with LexisNexis' official message. "This acquisition is all about growth. We are driven to reposition LexisNexis as a company that goes beyond research, which we're known best for, and offering professional firms a full package of resources and marketing systems," says Paul Gazzolo, COO of LexisNexis Martindale Hubbell.
Fineberg says that Interface will operate "business as usual," and the company has indicated that its corporate headquarters and key management staff will not change over the short term. One of the strong, immediate advantages of the acquisition should be to expose Interface to non-English speaking countries. Interface has traditionally done well in Australia, the U.K., and the United States, but lacks the global sales force reach of LexisNexis.
Although software vendors often look to add content through portal strategies or aggregator acquisitions, this purchase bucks the trend. "It's a brilliant inversion. Usually [service and software] vendors go out to the market to look for content they can sell to their customers," Pombriant says. "The fly in the ointment here is that it strikes me that Interface works best in large organizations where there are a lot of people and therefore a lot of potential contacts. If this is
a play for the smaller law firm market, it might be tough sledding."
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