A family-owned Ottawa tech enterprise that’s one of North America’s most dominant players in the niche field of police record management has been sold to a California-based private equity firm.
San Francisco’s Banneker Partners said this week it’s acquired a controlling stake in Versaterm, a 115-employee company that specializes in systems that store and analyze data for police and fire departments in Canada and the U.S.
Ottawa's Sampford Advisors acted as financial adviser to Versaterm. Financial terms of the deal were not disclosed.
Versaterm was founded in 1977 by a group of former RCMP employees who helped build the Canadian Police Information Centre, the national police database. Original owner Michael Goudge died in 1998, and ownership of the firm transferred to his widow Bernice and her children.
While the Goudge family was represented on the company’s board of directors, it was not involved in Versaterm’s day-to-day operations. The family had no succession plan and eventually decided to put the company on the market and exit the business, CEO Warren Loomis said.
After discussions with a handful of potential suitors, Versaterm began serious negotiations with Banneker early this year, Loomis said.
“We played the Bachelor for a little bit,” he said with a smile.
Under the deal, the Versaterm executive team will retain an ownership stake in the company, which will be rebranded as Versaterm Public Safety. The company will continue to be based at its Carling Avenue headquarters.
Banneker targets software firms with annual revenues of between US$1 million and $25 million, and its past investments include Ancestry.com. Versaterm becomes the fifth company in its active portfolio.
“They’re not like some of the bigger houses that just throw money out there and say, ‘Well, we might lose 20 per cent, but the other 80 per cent will really pay off.’ They’re extremely selective,” Loomis explained.
Versaterm might not be a household name in Ottawa, but it’s become the go-to supplier of dispatch software and records management services to about 100 police and fire departments in Canada and the U.S.
Versaterm’s platform feeds information to officers in the field in real time – for example, informing them if a suspect has a criminal record or whether a particular address has been the subject of previous complaints. Police forces in Minneapolis, Phoenix, Seattle, Toronto and Vancouver are among its customers, and it serves more than 130 RCMP detachments in British Columbia alone.
'We always flew under the radar'
Loomis, who’s been with Versaterm since 1987 and has spent 18 years as chief executive, said the company has flourished despite maintaining a low profile.
“We always flew under the radar,” he said. “Not very many people know about us in the Ottawa or high-tech community. We don’t even have a sign on our building. Our customers do all the selling for us.”
The veteran CEO said Banneker managing partner Stephen Davis wants to continue aggressively pushing the company into new markets and expanding its product base.
Versaterm made an acquisition of its own earlier this year, buying San Diego-based communications software maker TechVoice, and Loomis sees more potential M&A opportunities on the horizon.
“There’s lots of marketplace for us to grow,” he said. “We have the market, we have the product, we have the team. This will accelerate (our growth).”