Local software firm receives venture capital investmentWritten by Duane Ramsey | | firstname.lastname@example.org
Image Integration Systems (IIS) of Perrysburg is entering a growth phase in its business and recently received a significant investment in capital from Plymouth Venture Partners to finance that planned growth.
IIS specializes in the automation of accounts payable processes and document management software solutions. It offers a suite of content and workflow software, DocuSphere, an accounts payable system with all associated consultation, installation, implementation, training and support, according to IIS President Brad White.
The firm’s primary business is automating accounts payable for JD Edwards software package users, generally large corporations with $500 million in sales and up, White said.
It serves customers around the world, including Border’s Books, Macy’s, Marathon Oil, Royal Dutch Shell Oil, the Shaw Group and Turner Industries.
“We have one of the best solutions for JD Edwards,” with about 6 to 8 percent of Enterprise Resource Planning (ERP) software but wanted to move into Oracle and SAP that represent 60 to 70 percent of the ERP marketplace, White said.
DocuSphere can reduce the manual system for processing invoices in 14 to 15 days to three days and the cost to process invoices from $15 to $3 per invoice, he said.
IIS needed capital to help it expand and “serve a tenfold increase in the size of the playground we work in,” White said.
“There’s a real need for capital in this region and we’re right for this size market,” said Mark Horne, CEO and managing partner of Plymouth Management Company with investor Bob Savage of Toledo, Jeff Barry and Ann Arbor’s Ian Bund, chairman and founder.
Plymouth Venture Partners is actively looking to make about 18 investments of $1 million to $3 million in growth stage companies primarily in Ohio and Michigan with established revenues between $3 million and $7 million, according to Horne.
IIS generated revenues of about $3 million last year, providing accounts payable solutions for 70 percent of its customers that receive a return-on-investment as fast as six months with its application. The firm expects to double that revenue in the next year, White said.
“It’s really great having these guys in our backyard. There is a considerable amount of value they bring to the table. I don’t have experience in building a plan or growing a company while they have a super track record,” White said.
After making 29 investments with Fund I, the venture capital firm has raised nearly $30 million in capital for Fund II, the only new fund in Michigan, according to Horne.
“The benefit of a strong record with Fund I has allowed us to raise additional capital for Fund II,” said Horne, who works out of offices in Ann Arbor and Toledo.
Savage was involved in seven of the 29 investments with Fund I and joined the firm last year. He continues to manage investments by his firm, Savage Consulting, and Rocket Ventures of the Regional Growth Partnership.
As part of the investment in IIS, Savage has a seat on its board of directors and Horne serves as an observing member of the board.
“We always take a board seat with our investments and try to have two partners actively involved with the companies we invest in,” Horne said.
“A month into the investment, the company is already ahead of plan by hiring five new people this year,” Savage said.
IIS hired two sales executives, a business analyst, development manager, and lead quality assurance person. It could be adding several more new hires in the near future, White said.
Two objectives of the plan were adding sales resources and expanding product into the Oracle and SAP markets, Horne said.
Image Integration Systems is a privately owned C-corporation with four shareholders, including Plymouth Venture Partners as one shareholder. It has operated in the Toledo area since 1993 and from its current location in Perrysburg since 1999.
The original founders of IIS worked for Software Alternatives, which went out of business in 1993. IIS rose out of the ashes of that company upon recommendation by JD Edwards, which used the original system developed by Software Alternatives.
IIS started with six people and has experienced slow controlled growth, moving from a reseller of software to a developer of it, White said.
The company has 18 employees with 10 directly involved in the software process. One programmer telecommutes from Colorado while a project leader living in Maryland travels around the world, working with clients Monday through Friday.
“Our transactional processing is different than others. It’s not an accounts payable program that drives the system. We let the business process drive what happens,” White said.
Tags: Border’s Books, DocuSphere, Image Integration Systems, Macy’s, Marathon Oil, Rocket Ventures of the Regional Growth Partnership, Royal Dutch Shell Oil, Savage Consulting, the Shaw Group, Turner Industries