Soft pedal software
ansarada leads the feature story in the December edition of Australian Private Equity & Venture Capital Journal. Here’s Managing Editor Adrian Herbert’s piece on us.
US investment has helped several Australian software companies write international success stories but others are quietly writing their own, some, without any venture capital.
As online data-rooms have become standard M&A tools, ansarada has maintained a position as one of − if not the − leading products globally.
Now used around the world, ansarada was developed in Australia and the company still has its global headquarters in Sydney.
Online data-room products were already available when development of the ansarada platform began in 2004. Products then available mainly focused on security with less regard to user-experience. Negotiating deals through online data-rooms was a slow and frustrating process.
The ansarada team sought to develop a more user-friendly product. Launched in 2006, the software has been progressively updated but retains the initial concept of “sophisticated simplicity”. Earlier this year, a development team in Ho Chi Min City was hired to accelerate the rate of updates and widen the scope of the product beyond M&A.
Global head of sales Clive Cooper stresses the Vietnam team was selected on talent not cost with the objective of keeping ansarada ahead of competitors.
The ansarada platform has long been used for fundraising, private placements, tenders and IPOs despite not being marketed for these uses. Future versions will expand capabilities in these areas, Cooper says.
He is now trying to convince private equity clients to keep online data rooms live after acquiring companies. Using ansarada to share files between a private equity firm and an investee company will keep the company “deal ready”. This will help private equity firms act quickly on further acquisitions, or exits, he says.
There is good value in this, Cooper argues; a virtual data-room used to negotiate a deal usually passes to the buyer as part of the company’s assets on completion.
Many ansarada features − such as setting permissions for access to financial information – can be used to improve the efficiency of day-to-day business operations and reduce the risk of information passing into the wrong hands, Cooper says.
Permissions can be set to appropriate levels for board member access. The technology can also be set up to automatically generate specific financial reports − a useful facility for private equity owners who require quarterly information in standard formats for reporting to limited partner (LP) investors.
Used in the M&A process, ansarada virtual data-rooms provide vendors with high levels of control and enable them to monitor the actions of bidders even outside the data-room. If bidders download documents in bulk, embedded security will still track and report what PDFs they view and print and even identify specific areas of interest down to search terms used.
This facility easily sorts out “tyre-kickers” from those with genuine interest. Faking interest would simply require too much effort.
Vendors are also able to set time limits on access to documents by setting self-destruct times. These security policies are verified in real time every time a document is activated, irrespective of device type.
Development of the ansarada technology began with a single M&A deal, the sale of online tourist accommodation site HotelClub.com in 2004. Two accountants involved in the sale, Rachel Riley and Daphane Chang, wanted to set up online due diligence. They found the options available frustrating to use and turned to lead software developer for HotelClub, Andrew Slavin, to develop their own virtual data-room.
When Rachel’s brother, entrepreneur Sam Riley, learned about the project, he wondered whether there might be a market for the technology. He sought the opinions of M&A bankers and lawyers on the products available. From their responses, he put together a wish-list of what a new product should offer. The result was ansarada, which launched in 2006.
One of the first deals conducted using the new product was the partial exit of the Packer family’s interests in Publishing and Broadcasting that year. The deal set up a $5.5 billion enterprise, PBL Media, a 50/50 joint venture between the Packer family and private equity entities CVC Capital Partners and CVC Asia Pacific Ltd. The sell-down of the Packer family stake was transacted swiftly and confidentially.
After that, ansarada data-rooms were used in a series of state government asset sales with the result that the technology came to the attention of the international market.
More than 10,000 deals have now been conducted using ansarada virtual data-rooms. The company has expanded to offices in London, New York, Chicago, Singapore, Amsterdam, Frankfurt, Hong Kong, San Francisco, Johannesburg and Shanghai.
The spread of offices across time zones has helped ansarada maintain an early commitment that customers would always have telephone access to human help 24 hours a day.
The company remains privately owned with the founders holding most of the shares alongside a few private investors.
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